Neilson Cadbury eyes Mexico market

Neilson Cadbury, the confectionery division of William Neilson, is betting a newly signed distribution deal with PepsiCo will enable it to become a major player in Mexico’s emerging confectionery market.

Under the agreement, Sabritas, a Mexican subsidiary of PepsiCo, will distribute Neilson Cadbury products to Mexican stores at the same time that it drops off its current offering of salty snacks, hard candies and other products.

Historically, foreign chocolate manufacturers have faced prohibitively high tariffs when shipping product into Mexico.

But two years ago, the Mexican government reduced the tariff to 20%, with the promise of further reductions if the North American free trade agreement is introduced.

Since the drop in tariff, the world’s largest confectionery makers, among them Mars, Hershey Foods, and Nestle, have rushed to establish operations in the country.

Almost overnight the market, which is still in its infancy, has ballooned to $200 million in annual sales. PA