Alpine Confections, Inc.

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Alpine Confections, Inc.

119 East 200 North
Alpine, Utah 84004
U.S.A.
Telephone: (801) 756-6916
Toll Free: (800) 377-4368
Fax: (801) 756-7791
Web site: http://www.fanniemay.com

Private Compan
Incorporated: 1999
Employees: 900
Sales: $125 million (2005 est.)
NAIC: 311320 Chocolate and Confectionery Manufacturing from Cacao Beans; 311330 Confectionery Manufacturing from Purchased Chocolate; 311340 Nonchocolate Confectionery Manufacturing

Alpine Confections, Inc. owns a number of candy companies, including Maxfield Candy Company, Kencraft, Inc., and Harry London Candies Inc. The Fanny Farmer and Fannie May brands were acquired from bankrupt Archibald Candy Corporation in 2004. Alpine also produces confections under license for Hallmark and Mrs. Fields'. Canadian brands include Dolce d'Or and Botticelli, produced at the Dynamic Chocolates plant in Delta, British Columbia.

Utah Origins

Robert B. Murray and his son, R. Taz Murray, acquired Salt Lake City's Maxfield Candy Co. in August 1993 for $1.8 million. Bob Murray had become a business professor at Brigham Young University after flying jets in the Korean War.

Maxfield was known for its boxed chocolates and chocolate-enrobed cream sticks. It had been formed in 1947 by A. Vard Maxfield. His son, Neal, was president of the company when it was sold to the Murrays.

Taz Murray then became business partners with a former classmate at Harvard Business School, David Taiclet. (After getting their MBAs, they had worked for a time at Cargill and Deloitte & Touche, respectively.) The expanded partnership acquired another Utah confectioner, Kencraft, Inc., in 1994.

Kencraft had been founded in 1969 by Ken and Marlene Matheson of Salt Lake City. Their first products were hollow sugar Easter eggs with figures inside. The Mathesons moved to Utah County in 1972.

Kencraft's big break came when a New York buyer noticed the novelty candies at a Chicago trade show. The operation moved into a 900-square-foot building at the Alpine Valley Lumber Co. in the town of Alpine. This became Kencraft's permanent home and the site of a 90,000-square-foot factory.

A pair of "Peppermint Place" retail outlets, one adjacent to the plant, opened in 1991. By 1993, the company was making 800 different products, including lollipops, chocolate truffles, candy canes, and confections designed to celebrate a number of holidays. Many of the items were adorned with hand-formed figures and branded with names such as Candy Climbers, Puppet Pals, and Bubble Gum Buddies. Kencraft employed 215 people, many of them "craftsy" Mormon women who decorated the candies.

Under new management, Taiclet told Candy Industry, employment became less seasonal for Kencraft's production workers as the company built up inventory. They also added incentives for productivity. The Utah Department of Workforce Services cited Kencraft as a "Top Family Friendly Company."

Late 1990s Licensing

In the late 1990s, Maxfield Candy updated its logo and packaging for its own brand, All American Chocolates. A new boxed chocolate line aimed at the Hispanic market called "¡Coleccion Festiva!" (Festive Collection) was tested, reported Professional Candy Buyer. The assortment included some tropical fruit centers such as mango and lime.

Maxfield had entered a deal to produce confections under license for Mrs. Fields' Original Cookies in 1997, and spent two years developing the concept before its Christmas 1999 launch. Some of the candies, dubbed "Decadent Chocolates," featured centers based on established Mrs. Fields' cookies flavors such as Chocolate Chip Cookie Dough and Debra's Special Oatmeal Raisin Caramel, noted Professional Candy Buyer. The Kencraft unit gained a license for Disney characters in 1998; licenses eventually followed for the Peanuts gang, Raggedy Ann and Andy, Curious George, and others.

Custom orders accounted for half of Kencraft's business in 2000, according to one executive. The unit was beginning to expand overseas, forming a Polish joint venture with the Dutch company Luijckx BV Chocolade. Exports accounted for 5 percent of sales at the time.

In 1998 Alpine acquired Vancouver's Dynamic Chocolates, Inc., maker of Dolce D'or Seashell Treasures chocolates and Botticelli "Hedgehogs." Dynamic had been established by Richard Foley in 1991. Six years later, it moved its operations to one of North America's largest and most advanced chocolate molding plants, a 55,000-square-foot factory. A majority of its revenues came from outside Canada.

Formation of a Holding Company in 1999

In the five years after the Maxfield purchase, four other candy companies had been acquired by the group: Kencraft Candy, Fernwood Candy, De La Mare Taffy, and Dynamic Chocolates—manufacturer of the Botticelli brand. (Maxfield also produced chocolates under the Mrs. Fields' brand.) A holding company, Alpine Confections Inc., was formed in 1999.

Candy Industry estimated the Kencraft unit's 2001 sales at $15 million. The company was producing ten million candy sticks and candy canes a year and employed 360 people.

Kencraft was the exclusive candy maker for the 2002 Winter Olympics in Salt Lake City. In a much larger licensing deal, Alpine began producing boxed chocolates for the Hallmark Chocolatier brand in 2002. These were distributed in the thousands of stores that carried Hallmark cards.

Sales were $80 million in 2003, when Alpine had 900 employees. The company had two manufacturing facilities in Utah and one in Vancouver, where its Dynamic Chocolates unit supplied the Canadian market with Dolce d'Or and Botticelli branded items.

Adding Big Brands in 2003

In 2003, Alpine acquired Harry London Candies Inc., a Canton, Ohio maker of premium chocolates, for a reported $13 million. Harry London had become insolvent after borrowing heavily to expand. It had been founded in 1922. Before its bankruptcy, Harry London had eight retail stores and 270 employees in addition to a 200,000-square-foot factory. Alpine kept this facility active. Harry London's sales were about $20 million a year.

In 2003, Alpine and North Development Company won a bid to acquire the Fannie May and Fanny Farmer brands from the insolvent Archibald Candy Corporation of Chicago. The price was $39 million, which included 31 Midwest area retail stores. These were reopened in the fall of 2004.

At its peak, Archibald had operated the largest candy chain in the nation, with hundreds of stores and 3,000 workers. It had been founded by H. Teller Archibald, who opened the first Fannie May candy shop in Chicago in 1919. Archibald bought another venerable boxed chocolates brand, Fanny Farmer, in 1995. Fanny Farmer dated back to 1919 and was said to be named after legendary cookbook author Fannie Farmer (though the names were spelled differently).

Fannie May's Mint Meltaways (mint chocolate centers in chocolate or pastel candy), Trinidads (chocolate center inside a coconut/pastel shell), Pixies (nuts and caramel enrobed in chocolate), and other candies inspired legendary devotion from consumers in the Midwest, who stockpiled them as Archibald went through its bankruptcy. Alpine had resumed production of these confections, however, even before it had completed the Fannie May acquisition, reported the Salt Lake Tribune.

"The brand stood to take a huge hit if it went away for a year," explained Taz Murray. The Chicago Tribune reported that Murray's partner, Dave Taiclet, had first become acquainted with Fannie May Pixies during his Indiana boyhood. "We love the brand," said Taiclet. "We want to do everything we can to protect and grow it."

According to the Chicago Tribune, Alpine had to begin running three shifts at its Utah plant to keep up with demand. Fannie May chocolates were popular as fundraising items; 1,500 charitable groups sold $2.6 million worth of the candy a year.

Principal Subsidiaries

Dynamic Chocolates, Inc. (Canada); Fannie May Confections Inc.; Harry London Candies Inc.; Kencraft, Inc.; Maxfield Candy Company.

Principal Competitors

Chocoladefabriken Lindt & Sprüngli AG; Godiva Chocolatier Inc.; Guylian USA Inc.; Nestlé Confections & Snack (Nestlé USA); Rocky Mountain Chocolate Factory, Inc.; Russell Stover; World's Finest Chocolate, Inc.