Breaking News

Higher Feedstock Prices Burn the Candle Industry

May 2, 2007

Despite major expansion during the 1990s, the U.S. candle market’s growth has dimmed slightly since 2003. The market, estimated at $2.3 billion in 2006, has experienced success across all consumer groups, but lower-cost alternatives and lack of brand distinction continue to plague the category.

Even though sales have declined by more than 7% from 2005 to 2006, consumer usage has continued to soar. According to a new study by Mintel, 77% of consumers said they purchased a candle in 2006; that’s up from 64% in 2002. In addition, nearly 33% of consumers said that they purchase candles once a month or more often. With the accessibility of low-cost offerings in the candle category, consumers are saving money but manufacturers are not enjoying higher profit margins.

“Candle manufacturers have to contend with cheaper alternatives and increased production costs,” said Chris Haack, analyst for Mintel. “Petroleum is a key resource in the candle manufacturing process, and it has continued to soar in price during the past few years. This, coupled with the fact that major category competition prevents candle companies from passing along the added costs, is contributing to the downturn in sales.”

Companies are creating new scents and more decorative offerings in order to continue building loyalty. In addition, new consumer groups are discovering the candle category. Among male survey respondents, 65% said that they purchase candles. In addition, 64% of male candle purchasers agreed that there should be more male-targeted candle products.

As the low- and mid-cost candles continue to erode under the pressure of strong competition, the high-end segment continues to tap into the home decorating angle for increased sales. From 2004 through 2006, this segment rose more than $130 million to reach $772 million last year.

More info: www.mintel.com.
blog comments powered by Disqus
  • Pushin’ the Cushion

    Pushin’ the Cushion

    Christine Esposito, Associate Editor||July 26, 2016
    AmorePacific, the creator of the cushion compact, continues to improve its unique product.

  • Cozy Makes a Splash

    Cozy Makes a Splash

    Melissa Meisel, Associate Editor||July 25, 2016
    Expands reach in CVS and introduces new collection.

  • Senior Skin Care

    Senior Skin Care

    Christine Esposito, Associate Editor||July 19, 2016
    McCord Research and Product Quest Manufacturing roll out new hospital-grade skin care kits for seniors to use at home.

  • Sustainability is Omnipresent

    Sustainability is Omnipresent

    Christine Esposito , Associate Editor||July 1, 2016
    Industry stakeholders convene in New York City for Organic Monitor’s annual event

  • Perceived Perfection

    Perceived Perfection

    Christine Esposito, Associate Editor||July 1, 2016
    From primers to pressed powders, facial cosmetics help create the illusion of a flawless complexion.

  • Preserve & Serve

    Preserve & Serve

    Melissa Meisel , Associate Editor||July 1, 2016
    Suppliers with innovative preservatives provide staying power for formulations.