HOT AND BRIGHT

Candles have become one of the hottest nonfood categories at supermarkets.According to retailers and suppliers polled by SN, few nonfood categories are registering the high profit and double-digit growth rates of candles right now.Last year consumer spending reached a record high, with Americans purchasing four billion candles at a retail value of almost $2 billion. This figure does not include sales

Candles have become one of the hottest nonfood categories at supermarkets.

According to retailers and suppliers polled by SN, few nonfood categories are registering the high profit and double-digit growth rates of candles right now.

Last year consumer spending reached a record high, with Americans purchasing four billion candles at a retail value of almost $2 billion. This figure does not include sales of candle accessories, which have become another driver within the category. Since the early 1990s, candle sales have grown 10% to 15% annually, according to industry sources.

Jan Winn, director of health and beauty care and general merchandise at Big Y Foods, Springfield, Mass., confirms that candles are a growing, profitable category. "We are currently selling the Candle-Lite brand and have expanded our candle display to an 8-foot department in the housewares aisle. In addition, 4 feet of more upscale candles are displayed in the greeting card aisle," she said.

Scott Lindsay, the Spa Store manager for Dorothy Lane Market and Spa Store in Dayton, Ohio, which specializes in upscale body care products and supplements, reported that one out of every three customers walked out of the store with a candle purchase during the Christmas selling season. According to the National Candle Association, based in Washington, which represents both candle manufacturers and the suppliers of raw materials, 35% of all candles are sold during the Christmas holiday season.

"Candles have been selling extremely well. Right now we are earning a 40% to 50% profit margin," Lindsay said.

At the Spa Store, candles are displayed in an aromatherapy section alongside such products as essential oils and incense. "Our best seller is a 'relax candle' that is scented with lavender and camomile and produced by Luna Inc., based in Buffalo, N.Y.," Lindsay said.

The introduction of a whole new generation of colors, shapes, sizes and fragrances along with candle-related accessories has helped build sales momentum.

A major candle manufacturer typically offers between 1,000 and 2,000 varieties of candles in its product line, including tapers, spirals, columns, votives, wax-filled containers and novelties, the National Candle Association said.

The image of the candle has gradually evolved from a functional, prosaic product into a chic, "must have" item found in millions of households nationwide. The influence of decorating gurus such as Martha Stewart is often cited as a major factor in the high demand for candles today.

Demographic studies show that approximately 95% of all candle purchases are by women, making it an ideal product category for supermarkets to merchandise.

As in most nonfood categories, supermarkets are not alone when it comes to selling candles. Nowadays there are candle displays virtually everywhere from drug store chains to department stores as well as mass merchandisers and specialty shops. Retails range from 25 cents for a small votive up to $75 for a large pillar or specialty candle.

"The candle category today ranks as the fastest growing of the top 100 mass retail categories," notes Peter Fahrenkopf, executive director of sales for American Greetings, Cleveland.

American Greetings launched a new candle company, GuildHouse, this past September to capitalize on this growing segment.

"We work with each retailer individually to recommend appropriate locations, including the air freshener and social expressions aisles and/or a seasonal or novelty offering in the bakery or floral department of a supermarket," said Fahrenkopf.

Another candle supplier, Gibson Greetings, Cincinnati, provides innovative merchandising methods as it aims to capture both impulse and repeat candle sales.

Among the variety of Gibson display options found in supermarket chains such as Winn-Dixie Stores and Vons Cos. stores are 4-foot in-line, pinwheel and countertop displays. Gibson also has created all new display signing to showcase its new brand name, Glowing Moments.

"Our customers tell us that they are using aromatherapy candles both as an air freshener and a mood setter," said Dianne Woellner-Krupp, Gibson general manager. "Candles are now seen as fun as well as functional, and retailers just can't get enough of our scented products. Sales have doubled within the past year and wax-filled containers have been especially popular."

Bill Roach, buyer at Raley's Supermarkets, West Sacramento, Calif., said Carolina Candles, North Charleston, S.C., has been its main supplier over the past year. "We sell an array of products including votives, tapered, decorative and aromatherapy candles along with candle holders, which are displayed in a 3- to 4-foot in-line section made up of slanted shelving with dividers."

A total of 115 Raley's Supermarkets are located in northern California and north-central Nevada. "Each store has the flexibility in its gift department to expand footage and bring in whatever candle products it chooses," Roach said. He also noted that aromatherapy candles are especially hot sellers right now and profit margins are substantial.

"Our consumer surveys tell us that three major selling points are [in order] color, scent and price," Fahrenkopf noted.

"Price is not always the main determining factor -- you can put any price on it but if the candle is not the right color or scent, she will not buy it."