Mars, Inc., the closely held company best known for treats like M&M’s and Snickers bars, looks to double the size of the business over the next 10 years as it expands deeper into pet care and non-confectionery nutrition.
Chief Executive Officer Grant Reid announced the goal in an interview with Bloomberg Businessweek, offering a rare peek into the ambitions of a family-owned company that isn’t required to disclose its financial data. Such an increase could push sales at the 107-year-old company beyond $70 billion, up from about $35 billion now, and it plans to do so without going public. That would make its sales about as big as Target Corp. or Procter & Gamble Co. are today.
“Our vision is to keep our privately held company forever,” Reid said in the interview at Bloomberg’s New York headquarters.
Reid said he sees new sales coming through a combination of acquisitions, including its $9.1 billion purchase of animal-hospital chain VCA Inc. in 2017, and growth of home-grown brands, some of which are being incubated through a new division called Mars Edge that focuses on health and wellness.
One example is CocoaVia, a cocoa-extract based dietary supplement that’s a “small but fast-growing brand,” Reid said. Through a partnership with India’s Tata Group, Edge is also developing a protein-rich pea and lentil-based snack called GoMo Dal Crunchies aimed at remedying malnutrition.
“We see massive opportunities in both mass and personalized nutrition,” Reid said.
But it’s not just human snacks driving growth. Pet care accounts for about half of Mars’s business and employs more than 60 percent of its workforce of 115,000, according to Reid. The company is one of the biggest players in the $86 billion U.S. pet industry through brands like VCA, Pedigree and Whiskas pet food. It also sells a GPS Pet Tracker, called Whistle, and a pet DNA test.
The seemingly incongruous pairing of pet products and candy makes more business sense than initially meets the eye, Reid said. Both have similar points of retail, mainly supermarkets, and both have strong emotional resonance with consumers. People have nostalgic affection for age-old treats like Mars bars and also have come to view pets as members of the family.
Candy as Treats
Pets could also serve as a smart hedge against increasing scrutiny of the candy industry as the public grows more wary of excess sugar consumption. Mars avoids marketing to children and was the first to place nutrition labels on the front of packaging, Reid said.
“It’s the right thing to do and we want to be transparent,” he said, noting that his favorite Mars candy is Galaxy chocolate. “We absolutely know that our sugar products should be enjoyed as treats.”
McLean, Virginia-based Mars is still owned by members of the Mars family, now entering its sixth-generation of involvement. Six of the family members are ranked among the world’s richest people on the Bloomberg Billionaires Index with a combined net worth of more than $100 billion.
“The Mars family is very knowledgeable about the business and very interested in the business,” Reid said. “A lot of people think that because we’re privately held, we don’t have to perform well, but actually we do, because they have an alternative to put the funds elsewhere.”
|Reid was interviewed by Bloomberg Businessweek Editor Joel Weber on Jan. 10 as part of the recurring Debrief interview series, where the world’s most prominent business leaders, entrepreneurs and political figures sit down to talk about their experience and share their insights on the state of business and the global economy.|
Read the full story at Bloomberg