Niederegger Marzipan

Sweet on Change

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Keeping up with tradition. Source: Niederegger

It used to be an emperor’s dessert. Marzipan, a smooth almond and sugar confection popular around Europe, was a staple of noble sweet tooths a few hundreds years ago. Just ask Niederegger, a family-owned confectionery in the northern German city of Lübeck, that once fielded orders from the likes of the last Russian czar and Kaiser Wilhelm II.

Cravings for marzipan have changed a lot since Niederegger was founded in 1806. In Germany, the candies are sold year-round next to gum and chocolate in supermarkets, but they really only fly off the shelves just once a year: Christmas. Niederegger’s marzipan, wrapped in festive-colored foils and shaped into whimsical figures from horses to starfish and pigs (the most popular shapes), are celebrated gifts during the Yuletide holidays.

The company wants to change that and make it a sugary snack for 365 days of the year. Niederegger, once bound for decades to its secret recipe for an unchanging product selection, is trying a lot of new stuff lately. Think a “men’s line” with nougat espresso shots, apple bourbon and whisky cola marzipan bars, and an assortment shaped like a toolkit. Or a new maple-syrup-and-pancakes flavor. They’re even launching marzipan ice cream.

Making over the packaging of old products and creating new ones has meant a “very large investment,” said Niederegger boss Antonie Strait. But she and her sister Theresa Mehrens-Strait, who took the reins of the business in early 2016, said it was necessary.

After 30 years in charge, their parents, Holger Strait and Angelika Strait-Binder, are slowly retreating from daily business. The eighth generation has now taken over and is eager to make changes.

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Out with the old. Antonie Strait and Theresa Mehrens-Strait. Source: Niederegger

Marzipan doesn’t turn the royal profits that it used to. Rising prices of raw products such as almonds and hazelnuts, along with cheaper competitors, have bitten into the company’s earnings. Niederegger refuses to cheapen its flavor and overall quality by adding extra sugar to cut costs, like some of its rivals do. In 2015, their father said in an interview with the newspaper Hamburger Abendblatt that Niederegger was doing “very badly” and that he had hoped to hand the company over to his daughters with “good numbers instead of problems.”

The sisters would tell Handelsblatt little about revenues, other than that they were over €100 million ($118 million).

A number of family confectioneries have already given up. Wagner Pralinen from Brunsbüttel, near Hamburg, went insolvent for a while. Bavarian confectioner Schwermer, which makes marzipan and other sweets, has been sold to a Swiss company.

“Marzipan is a niche market, and it isn’t to everyone’s taste,” said Rainer Hornschild, an industry expert with Nuremberg consulting firm Parzer and Associates. “There is only limited freezer space in stores, and they are competing with Nestlé and other major players. But kudos to them if they succeed.”

Sweet Treat

Ever wondered how marzipan is made? Take a video tour around a factory.

It won’t be long before Niederegger’s factory kicks into high gear. Companies order marzipan as gifts for employees, shaped in custom molds with business logos and personal messages. The Santa heads, Christmas bells and reindeer will start to churn out for another season.

Ms. Mehrens-Strait hopes that new offerings such as the men’s line, available in department stores and Harley-Davidson motorcycle showrooms, will help buoy profits not just this Christmas, but all year long. “Why shouldn’t people eat marzipan while watching soccer?” she said.

That’s a far cry from her father’s philosophy. In an interview years ago, Holger Strait said the company “couldn’t change consumers’ eating habits.”

Ms. Mehrens-Strait and her sister are keen to take risks. After all, she left a job at home shopping channel QVC for Niederegger, but not because she had to. She wanted to.

“Our parents didn’t raise us to join the business,” she said. “We’ve always loved marzipan.”

 

Barbara Woolsey writes for Handelsblatt Global in Berlin. Alexander Demling is a reporter for Handelsblatt. To contact the authors: b.woolsey@extern.vhb.dedemling@handelsblatt.com.

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