Hershey is set to boost productivity and cut inventory after deploying technology across its supply chain, executives said at its 2026 Investor Day.
The confectionery and salty snack maker invested in decision-intelligence software that gathers and analyzes supply chain data and creates alerts for operations managers, Chief Supply Chain Officer Jason Reiman said during the March 31 presentation.
On the factory floor, for example, decision intelligence notifies workers when more packaging is needed if production gets ahead of plan, Reiman said.
"Now there are thousands of decisions that happen every day across complex supply chains," Reiman said. "And we see decision intelligence as an opportunity to increase productivity by $50 million and reduce our inventory by $100 million over the next 2 years."
In 2024, Hershey undertook a $250 million supply chain and manufacturing project to boost agility and efficiency. The investment focused on digitizing processes, improving visibility, streamlining operations and optimizing procurement and manufacturing.
Today, Hershey is using technology across sourcing, manufacturing, delivery and planning, Reiman said.
“In supply chain, nothing really moves ahead without technology,” Reiman said.
On the sourcing front, Hershey's technology investment helps it detect supply-and-demand changes related to commodities such as cocoa. The company combines hedging tools with market intelligence and governance to manage its cocoa sourcing, Reiman said.
"It allows us to ensure that we're going to deliver against our plans. We're able to reduce volatility, and that we have prices that are competitive versus our peer set," Reiman said.
Hershey is also investing in spend visibility to understand where the company stands relative to the competition, Reiman said. Cost modeling gives sharper category strategies to the sourcing team.
In manufacturing, the company's connected worker initiative, part of Hershey's Digital Lean strategy, equips operators with digital tools, real-time data and guided workflows to quickly solve problems and collaborate, replacing slower, paper-based processes.
"This allows every worker or every operator on our factory floor to understand the efficiency of how our line is running," Reiman said. "And if there is a problem, what are the root causes, and what are the corrective actions you take to make sure that we get it fixed immediately."
To improve delivery, the company implemented store-specific assortments that match each location's brands and counts to geo-demographic data and input from sales teams, Reiman said. The company automated delivery-unit assembly, cutting lead time from conception to delivery by 50%.
Because of Hershey's technology investments, Reiman said he feels good about productivity in 2026 and even better about the projected gains in 2027 and beyond.
"The more productivity that we can generate, the more we can reinvest back in our business; the more we can invest back in our business, the more we can grow," Reiman said. "And the more we can grow, the more opportunities we have to find productivity.”
