Necco

Not to be confused with Northern Essex Community College.
New England Confectionery Company
Private company
Industry Confectionery
Predecessor Chase and Company, Ball and Fobes, Bird, Wright and Company
Founded 1901
Headquarters Revere, Massachusetts, USA
Products Necco Wafers, Sweethearts, Clark Bar and Haviland Thin Mints, among others
Owner American Capital
Number of employees
 483 (as of March 2011[1])
Website http://www.necco.com/

Necco (or NECCO), pronounced "neck-o", is the acronym for the New England Confectionery Company, a manufacturer of candy. It was created in 1901, by the merger of several small confectionery companies located in the Greater Boston area; since December 2007, Necco has been owned by American Capital.

The company, considered the "oldest continuously operating candy company in the United States,"[2] is best known for its namesake candy, Necco Wafers, its seasonal Sweethearts Conversation Hearts, and brands such as the Clark Bar and Haviland Thin Mints. In fall 2010, Necco produced its one trillionth Necco Wafer candy.[2]

History

The Necco complex in South Boston as seen from across Fort Point Channel, circa 1902-1907.

Necco dates its origins to Chase and Company, a company founded by brothers Oliver R. and Silas Edwin Chase in 1847.[3] Having previously invented and patented the first American candy machine,[2] the Chase brothers continued to design and create machinery that made assortments of candies, such as their popular sugar wafers.

Two other confectionery companies, Ball and Fobes, founded by confectioner Daniel Fobes in 1848, and Bird, Wright and Company, a confectionery company based in Boston and founded in 1856, joined forces with Chase and Company in 1901 to become the three members of the original Necco family.[3] The three confectionery firms then moved into a newly constructed manufacturing plant in the Fort Point/South Boston Waterfront area of Boston, Massachusetts one year later and became the largest establishment devoted entirely to confectionery production in the United States.[4][5]

The Boston Wharf Company developed the 1902 complex of four five-story buildings[6] at 253 Summer Street and 11-37 Melcher Street. BWC named the adjacent streets Necco Court, Necco Street, and Necco Place.[7][8] In 1907, 5 and 6 Necco Court were added behind the existing complex, connected by a four-story interior bridge.[8] With nearby rail and water transportation, BWC specialized in shipment and storage of sugar and molasses. The Domino Sugar factory was also located nearby.[8]

Success prompted the company, in 1906, to introduce a profit sharing plan.[2] Necco continued its production while the confectionery industry continued to boom through the turn of the century. Around the same time, businessman David L. Clark, began experimenting with his own candy creations in his home outside of Pittsburgh, Pennsylvania. He began selling the Clark candy bar for five cents and shipping his creation to soldiers fighting in World War I.[3] At the same time, Charles Miller started a business manufacturing and selling homemade candy in the Boston area. Clark's creation and Miller's Mary Jane quickly become two of the most popular candy creations in the country.[5]

Former Necco factory on Mass. Ave. in Cambridge, Massachusetts, featuring a water tower painted to look like a roll of Necco Wafers.

In 1927, Necco moved into a new factory on Massachusetts Avenue in Cambridge, which was then the largest factory in the world devoted entirely to candy.[2][3]

Necco continued its dominance of the candy-manufacturing business through much of the first half of the 20th century. In 1942, the U.S. Government requisitioned a "major portion of the production of the wafers during World War II since the candy doesn't melt and is 'practically indestructible' during transit,"[2] This continued until 1945.[5]

For several years, Necco was the first, and exclusive, licensed distributor of Rolo candy in the US.[9] After losing the license to Hershey, for a time Necco marketed an identical product called "Milk Chocolate Caramel Roll".

Necco, still a family-run business in 1963 but having financial problems, was acquired by United Industrial Syndicate of New York. In 1978, after several reorganizations and seven company presidents, Domenic Antonellis was named its CEO,[4] a role he would play for nearly 30 years.[10]

Necco's Sweethearts as of 2011.

From the end of the war through the 1990s, Necco continued to acquire small candy companies throughout the United States and Europe, and with those companies, the rights to manufacture their trademarked candy bars. Wisconsin's Stark Candy Company, which was founded in 1937, was acquired in 1988.[11] The acquisition of Stark's Sweethearts, combined with Necco's existing Sweet Talk line of candies, made Necco the leading manufacturer of candy "conversation" hearts. In 1999, Pittsburgh-based Clark Bar America, Inc. was purchased,[3] and by 2000 the company had 1200 employees.[2]

In 2003, Necco consolidated its facilities to share a 52-acre (210,000 m2), 810,000-square-foot (75,000 m2) Revere, Massachusetts, plant and warehouse, where its international headquarters resides to this day.[2][12] The site employed more than 700 workers.[1]

Since April 2004, the Necco building at 250 Massachusetts Ave in Cambridge has been occupied by the Novartis Institutes for Biomedical Research. The water tower was repainted with a double helix to represent the biomedical research being performed within.[13] In 2005 the structure, which is still referred to as the Necco candy factory, was added to the U.S. National Register of Historic Places.[14]

By 2005, the company's annual revenue was around $100 million, at which level it was to remain for several years.[10]

In December 2007,[15] a buyout of Necco was orchestrated by the private equity fund American Capital Strategies (in partnership with Clear Creek Capital and Domenic Antonellis, the company's CEO).[10][16] Necco announced the closure of its Pewaukee, Wisconsin plant in March 2008.[11] In August 2008, Necco replaced its CEO with Richard Krause, a former Procter & Gamble executive, who in February 2009 announced plans to "expand its brand now in the U.S. so it can expand globally later", aiming for a 30% growth in revenue by 2011.[10]

In November 2010, Necco was listed for sale with a New York broker, though by February 2011 American Capital announced the sale was off for the time being.[1]

In July 2013, United Service Organizations sued Necco in U.S. District Court for continuing to use their trademarks after their 2009 marketing deal had expired.[17] As of January 2014, the case (1:13-cv-11754) was still pending.

Company Tax Breaks

The 2011 news that the company was no longer for sale was accompanied by reports that the company had supplied the city of Revere with five-year's worth of overdue reports required as part of a tax increment financing (TIF) deal the company had received from the city; those reports "seemed to indicate that Necco has—for several years—not created the jobs they promised in the TIF agreement"; as of March 2011 Necco employed 483 people, including 30 Revere residents.[1] The company's failure to meet the terms of its TIF agreement led the Massachusetts' Economic Assistance Coordinating Council to decertify Necco's participation in the economic development program that administers the agreement.[18] With the support of Revere's mayor, the City Council voted to maintain the tax break, which saves the company $300,000, reducing their annual property taxes to $750,000.[18] At one city hearing, Miles Arnone, a managing director of American Capital,[19] had a heated exchange with city council member George Rotondo (who was running for Mayor).[20] Arnone was upset about being forced to talk about Necco's health "when you're down 30 percent"; the public exposure of the issue was raising concerns from large customers of Necco such as CVS Pharmacy and Target.[18]

Brands

Banana Split chews.

The Haviland division of Necco produces many candies such as Haviland Thin Mints, Bridge Mix, and others.

References

  1. 1 2 3 4 Seth Daniel (March 16, 2011). "Company Not for Sale … for Now at Least". Revere Journal. Retrieved 2012-02-13.
  2. 1 2 3 4 5 6 7 8 Capuano, Michael E. (Spring 2000). "New England Confectionery Company". Local Legacies. Library of Congress. Retrieved 2008-03-12.
  3. 1 2 3 4 5 "About Us: History". Necco. Retrieved 2008-03-13.
  4. 1 2 Jo Ann Augeri Silva (March 1, 2004). "Sweet setup: Relocation and expansion define Necco". American City Business Journals. Retrieved 2012-02-13.
  5. 1 2 3 Kimmerle, Beth (2001). Candy: The Sweet History. Collectors Press, Inc. Retrieved 2008-03-13.
  6. ↑ http://boston1905.blogspot.com/2009/08/new-england-confectionary-company-necco.html
  7. ↑ Necco Place is marked on Google Maps as Necco Court, but see: City of Boston Fort Point Channel District Map
  8. 1 2 3 http://boston1905.blogspot.com/2009/09/necco-part-2.html. Missing or empty |title= (help)
  9. ↑ http://www.collectingcandy.com/wordpress/?p=4300
  10. 1 2 3 4 "162-year-old Necco has change of heart". Associated Press. MSNBC. February 4, 2009. Retrieved 2012-02-13.
  11. 1 2 "Pewaukee heartbreaker". Journal Sentinel. March 7, 2008. Retrieved 2012-02-13.
  12. ↑ "New England Confectionery Co. — Company History". FundingUniverse. Retrieved 2010-06-09.
  13. ↑
  14. ↑ Aoki, Naomi (July 9, 2003). "Candy Coated Power-Cleaning Clears Way for Labs at Old Necco Factory". Boston Globe.
  15. ↑ American Capital Invests in the One Stop Buyout of NECCO , a December 28, 2007 press release from the American Capital website Archived December 28, 2008, at the Wayback Machine.
  16. ↑ "Necco to close Stark Candy plant in Pewaukee". American City Business Journals. March 6, 2007. Retrieved 2012-02-13.
  17. ↑ "USO not sweet on NECCO"
  18. 1 2 3 Seth Daniel (July 27, 2011). "Council Votes to Maintain Candy Company's Tax Break". Revere Journal. Retrieved 2012-02-13.
  19. ↑ "Miles Arnone". American Capital. Retrieved 2012-02-13.
  20. ↑ http://www.reverejournal.com/2011/11/16/george-rotondo-we-are-sure-to-hear-from-him-again/
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