http://www.washingtonpost.com/wp-srv/aponline/19991029/aponline103938_000.htm

Computer Woes Hurt Hershey Delivery

The Associated Press

Friday, Oct. 29, 1999; 10:39 a.m. EDT

HERSHEY, Pa.  Problems involving a new computer system have disrupted distribution of Hershey's chocolates, so some little ghosts and goblins will be disappointed  or snacking on rival Mars bars  come Halloween.

And Santa might be next in line to be affected.

Hershey Foods Corp., the nation's largest candymaker, announced a 16 percent drop in third-quarter earnings per share earlier this week. Hershey Chairman and Chief Executive Officer Kenneth L. Wolfe acknowledged that the company's distribution woes have led to lost sales and increased costs.

He said the company had hoped to get customer service back to normal by the end of the month but that the goal would not be met. He said the company still expects to improve through the end of the year.

He gave few details, but The Wall Street Journal reported today that spot shortages of Hershey's products have prompted many stores to replace their usual supplies of the company's candies with other brands.

Sales have increased for rivals like Mars Inc. and Nestle USA without any special promotions to boost sales, the newspaper said. And some customers and industry analysts said they believe the problems could persist at least through Christmas.

Hershey said it lost about one-tenth of a percentage point of its still-dominant market share in the four weeks ended Sept. 12, and retailers forecast a sharper drop for October, the Journal reported.

Hershey spokesman John Long had no comment on the article, other than to refer to the earnings announcement, issued Monday.

The company planned to bring its new, $112 million computer system online during a slow period in April but was forced to delay until July when development and testing were not completed, the newspaper reported. That's the month that retailers begin ordering for Halloween.

In discussing the problem last month, the company said earnings for the entire fiscal year could be 8 percent to 10 percent below previous projections.

"For a candy company to miss part of Halloween is not as bad as a toy company missing part of Christmas, but it's close," John M. McMillin, who follows the food industry for Prudential Securities, said at the time.

) Copyright 1999 The Associated Press

-- Uncle Bob (UNCLB0B@Y2KOK.ORG), November 01, 1999

Answers

Discussion by Cory on this topic on csy2k

-- Linda (lwmb@psln.com), November 01, 1999.

If I'm not mistaken, their computer problems wre due to trying to change too much at one time, not a y2k issue per se. Not every problem is y2k related. It does show how computer problems related to y2k can cause problems. This, however, is not a y2k issue.

-- jb smith (joebobsmith@yahoo.com), November 01, 1999.

If it weren't for y2k, they wouldn't have switched to SAP. It doesn't matter if you view it as a y2k problem or not.

-- snooze button (alarmclock_2000@yahoo.com), November 01, 1999.

JB

Note that they brought their system up in July and it looks like they will still be "honked" until December. There are a helluva of a lot more companies that will be bringing up systems in November and December in order to try to be in place before year-end.

IT IS ALL BECAUSE OF Y2K.

No BITR or three-day snowstorm.

Don't move to Buenos Aires.

-- Dana (A_Non_O_Moose@xxx.com), November 01, 1999.

jb -

For most IT folks, "The Y2K Problem" is the challenge of having to evaluate all computer-dependent systems for date issues, then repair/replace any you want to keep using, then place them into production and have them be stable by 01/01/2000. It's a massive undertaking (with a rock-hard deadline) for an organization, and any problems generated by it have to be classified as "Y2K-related".

My current employer deployed SAP back in 1997. Partly Y2K-driven - this place starting working on Y2K in 1994. We lost track of all costs and revenues for over six months (resulting in some layoffs and re-orgs) and we're STILL sorting out some important functions. Anyone who thinks they're going to slam in SAP (or any other ERP system) at this point and not get hurt (perhaps seriously) is living in a dream world.

-- Mac (sneak@lurk.hid), November 01, 1999.

The company I work for brought a brand new SAP implementation at the end of July and IT WAS soley because of Y2K.....

-- BH (silentvoice@pobox.com), November 01, 1999.