Berkshire Hathaway traders who wanted a sugar rush at Saturday’s annual assembly have been in luck. Berkshire-owned See’s Candies and Dairy Queen each had fashionable cubicles on the exhibit flooring.
“Individuals want their sweet,” stated See’s Candies president and CEO Pat Egan. However inflation is a priority.
Egan famous that See’s has raised costs for some merchandise as a result of greater prices for components and packaging. However he added that a variety of what the corporate wants to provide its sweet is sourced from America, which signifies that there are fewer worries about greater abroad transport prices.
Egan stated final 12 months was the corporate’s greatest 12 months for gross sales ever, with income up 26% from pre-Covid ranges of 2019. He added that e-commerce gross sales have been particularly sturdy.
Dairy Queen CEO Troy Bader stated the ice cream chain can also be doing properly, particularly because it has added hen strips, burgers and different lunch gadgets to the menu.
Nonetheless, inflation is a giant situation for its shoppers.
“Inflation is sizzling. Customers are spending extra on housing, gas for our autos, utilities. heath care, on and on and on. The discretionary earnings we’ve got is smaller,” Bader stated.
He added that greater labor and gear prices are a problem for Dairy Queen franchisees too. That is why many have chosen to lift costs for some menu gadgets.
However Bader stated Dairy Queen franchise operators must “thread the needle” as a result of the chain does not need to lose clients. Value hikes are needed to guard revenue margins. The chance although is that customers could get turned off, which might harm gross sales.