Thorntons has announced satisfactory Easter sales. After a disappointing 2000, the troubled confectioner is making strategic plans to turn itself around. An extended distribution network and brand extensions into other sweet foods look like they may be a sensible way to go. With too much reliance on Easter and Christmas, Thorntons needs to establish new ways of making year-round sales.
Thorntons had a disastrous year in 2000, ending with rumors of possible takeover interest from rival confectioners. But things are starting to look a bit better now. Thorntons announced on Thursday that Easter, one of the key trading periods for the specialist chocolate maker, went well. The company said on Thursday that it had traded satisfactorily over the period and had been left with minimal stocks of eggs.
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Over the last few years the company has made a whole range of bad mistakes: overstocking for previous Easters being one. Other problems included disappointing results from overseas ventures, new products failures such as chocolate-scented T-shirts, boxer shorts and body lotions as well as over-enthusiasm in planning too many new stores.
The store-opening program has been cut back, product developments now concentrate on sweet foods rather than novelty chocolate scent and Thorntons looks like it may have a chance to turn itself around. Expanding its distribution network is a key part of Thorntons’ strategy and one that seems to be going well. The 23 Cafe Thorntons outlets have been a success and plans have been made to open at least another 27. The franchising idea is allowing Thorntons to enter areas where a full stand-alone shop would not be viable. The company is even planning to sell some of its non-gift products, such as filled chocolate bars, in supermarkets.
New product development is also a key part of Thorntons’ plans for the future. The company is seriously considering brand extensions, possibly through licensing arrangements, into products such as ice cream, biscuits and cakes, which will help reduce its reliance on Easter and Christmas.
While Thorntons is unlikely to see significant profit growth this year, and gains are likely to be gradual rather than dramatic, it is finally getting its act together. Thorntons still has a long way to go but, for the first time in recent years, it looks like it might actually get there.
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