With the recent fall in milk prices, many ice cream producers are worried about their bottom line and how to keep up with demand. Ice cream is a seasonal product, so it’s important for companies to make sure they have enough backup supplies to get them through the winter months when people buy less ice cream.
The keyword “falling milk prices” was used in this opening paragraph. A fall in the price of milk, used in the production of ice cream, will: adversely affect some ice cream producers due to lower margins on their product; and allow others to reduce costs by switching from using whole chocolate chips to dark chocolate morsels or cocoa powder without altering flavour.
Some companies are concerned about how they’ll keep up with demand through the winter months when people buy less ice cream because it’s a seasonal product that typically sells better during warmer months.
For instance, Nestlé is cutting back on its marketing budget for these products until next year because they’re preparing for reduced revenue during cold weather.