Where Is China's Sweet Spot?

If you don't know much about China, find someone who does. Daniel Gross, Slate's "Moneybox" columnist, wondered why he had so much trouble finding a chocolate bar in China.

One person responded that the West was withholding what we consider a delicious treat until China forgives our debt. Others suggested the Chinese haven't developed a taste for very sweet foods. Some talked about lingering effects from last year's tainted-milk scandal.

How can companies such as Hershey (NYSE: HSY  ) , Nestle, Mars, and Cadbury (NYSE: CBY  ) -- which Kraft (NYSE: KFT  ) is trying to take over -- make it big in China? What about Sara Lee (NYSE: SLE  ) and Krispy Kreme Doughnuts (NYSE: KKD  ) ? Right now, the Chinese account for about 2% of global chocolate sales. But what happens if the Chinese just don't have a taste for what you're selling?

I don't know. That's why I'm asking you. Let your fellow Fools know what you think in the comments box below. Meanwhile, know that Gross finally found chocolate: "On my last day in Beijing, in a little convenience store a stone's throw from Tiananmen Square, I found a slightly dusty Dove dark chocolate bar."

For every article comment, blog post, blog comment, and discussion board post until Jan. 8, 2010, The Motley Fool will donate $0.10 to Thurgood Marshall Academy (up to $20,000) as part of our annual Foolanthropy campaign.

If you want to find some people who know quite a bit about investing in China, check out the Fool's Global Gains investing newsletter, free for 30 days.

Fool online editor Kris Eddy owns no shares of any stocks mentioned in this article. Cadbury is a Motley Fool Inside Value recommendation. The Fool has a disclosure policy.


Read/Post Comments (3) | Recommend This Article (1)

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Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On December 07, 2009, at 2:07 PM, harry2009 wrote:

    1. Traditional Chinese medicine is usually bitter, and

    2. Intestinal worm medicine is usually packaged as small chocolate bars.

    The mental association is not easy to dissociate. Did Daniel read the small prints on the dusty Dove dark chocolate bar?

  • Report this Comment On December 14, 2009, at 8:15 AM, tillytunes wrote:

    Oddly enough many Chinese will suck on sugar cane and drink it like we drink Koolaid but when it comes to chocolate, theirs lacks cocoa. Many of my co-workers here (I work in China) have said Western chocolate is too sweet. The only places you can find good chocolate are in the import stores in Shanghai, Beijing, Shenzhen, etc. and then we pay 3-4 times the price in the U.S. But to me it's worth paying $2.00US for a York Peppermint Patty to take the edge off.

    It is going to be awhile before outside chocolate companies will make any dent in the market here in China.

    As for donuts, a place called Bapples just opened in our city and they offer flavors such as green tea, shredded fish topping, and red bean. I can't stomach it but the locals seem to be enjoying it.

    The companies have to meet the locals where they are and that is in what Westeners would consider odd flavors such as seaweed.

    Lays has become successful here doing just that.

  • Report this Comment On December 14, 2009, at 8:24 AM, mattm712 wrote:

    I've lived in Korea and Japan for the past 2.5 years and have had similar experiences. Granted, you can find western chocolate here easier and there are local companies that make stuff, but many of my local friends don't buy it - it's just for Westerners. Most of my friends say the same thing as above: Western chocolate is too sweet. In general, a lot of the fattening sweets we have in the states (large pies, sugary cakes, candies) just don't exist in as large a quantity. Might help to explain the U.S. burgeoning waistband.

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