For the Smarties candy factory in Union Township, New Jersey, Easter is big. Valentine's Day, too, means a load of orders. But nothing compares with Halloween. "Oh, it's by far the most important holiday for us," says Liz Dee, co-president of Smarties.

If the name Smarties doesn't ring a bell, its slender rolls of biconcave candy disks--15 to a pack, in multiple flavors, all wrapped in old-timey cellophane packaging--should. One of the oldest family-run candy companies in the U.S., it's been in the Dee family for three generations, and now produces a staggering two billion rolls of Smarties every year. This year, the business is celebrating its 70th anniversary.

Interestingly, the company's monumental, nearly year-round preparations for Halloween result in a lull around the actual holiday. Orders from retailers planning on selling trick-or-treating candy come in up to 11 months in advance, the prior November. Those orders are produced through spring, and shipped out through summer. Which means as little ghouls pick out their costumes, and candy makers' Super Bowl approaches, it's oddly quiet at the Smarties factory.

Inventory is at its lowest point, and for employees, that means taking an extra day off is a fine idea. The private company's fiscal year ends on Halloween. (The company declined to disclose its annual revenue, or how much of it is derived from Halloween sales.) In the lead-up to the holiday, each member of the team is gifted 30 pounds of candy for their friends, family, and trick-or-treaters. Then on or about October 31, Smarties celebrates its year with a massive company luncheon.

Perhaps even more fun is the following week, though, when employees and executives regroup and reminisce about each being the house on their block with 30 pounds of candy to distribute. "The little kids in costume don't always realize that we adults can hear them when they say, 'Oh, this is the Smarties house!' or 'Let's come back and hit this house twice!'" Dee says.

A long family tradition

Liz Dee's family home has been the "Smarties house" since long before she was born.

In 1949, her grandfather Edward Dee immigrated to the United States from London, where his family had made candy for two generations before him. It's become family legend that when Edward purchased a tablet press machine and started producing the little sugar disks that would become Smarties, it was out of necessity. He tells his family members, time and again: "It was the only thing I knew how to do!"

Edward called the company Ce De Candy, and ran a small operation selling Smarties out of a garage in Bloomfield, New Jersey. He opened another plant in Toronto in 1963, and moved the Bloomfield operation to a larger facility in Union Township in 1967. (The company changed its official name to Smarties in 2011.)

Once grown, Edward's sons, Jonathan and Michael, joined the family business, eventually settling on titles of president and executive vice president, respectively. They launched new product lines, including sour-flavored Smarties, oversize Smarties, and candy necklaces. During a sugar-price spike in the '70s, they switched to dextrose, a simple sugar derived from corn, to make all of their products down to the tiny tablets that have always remained the company's biggest seller.

But, by the 2010s, Jonathan's and Michael's kids, too, were grown--and had grown up in New Jersey, surrounded by Smarties. Liz Dee, her sister Jessica, and cousin Sarah Rollerbladed around the factory floor as kids in the '80s, and caught the little sugar tablets hot off the presses.

The three like to joke that they always thought they had a lot of friends growing up--and now realize that unlimited candy at their house may have been a draw. The candy, their fathers' and grandfather's business, permeates every memory of childhood.

"Everything our dad did was infused with the smell of candy. Hugging him, riding in the car, his briefcase--everything," Liz Dee says. "And when you are in a family in business, Thanksgiving conversation can sound a lot like a board meeting."

Still, it wasn't a sure thing that Edward's granddaughters would join the family business. They each went to college, and chose majors that interested them. The two sisters went to work at other companies. But they didn't stay away for long. By the 2010s, Liz Dee, Sarah Dee, and Jessica Dee Sawyer all shared the title of executive president, overseeing different parts of the business. (A simplified picture is that Liz managed communications, Sarah oversaw operations, and Jessica ran sales.) And, in 2017, the three took over as co-presidents.

Just 15 percent of family businesses in the U.S. make it to the third generation, according to a study from Northwestern University's Kellogg School of Management. Considering that Edward's parents and grandparents were also in the confectionery industry in the U.K., the co-presidents of Smarties actually consider themselves to be fifth-generation candy makers.

Remaining family-owned while growing steadily is a challenge, however. The $10 billion candy industry in the United States is dominated by major players such as Mars and the Hershey Company. The top four candy corporations make up nearly 65 percent of the U.S. market, according to market research firm IBISWorld. And new candy innovations don't come easily: For every 10 new products Smarties launches, only one is a real, lasting hit, Liz estimates.

But the Dees are dedicated to keeping Smarties in the family in the future. When it comes to their succession plan, they say only that blood comes first--marrying into the family won't get you far. "I suppose we have an unspoken 'no-spouse rule,'" Sarah says. "It keeps things uncomplicated."

They say that continuity is also important to their employees, who number roughly 100 in New Jersey and 100 in Canada. "We have had tremendous support from our team during the leadership change," Sarah says. "I think they were excited because it was showing them how dedicated we are to being and staying a family-owned and family-run business."

Perhaps the front office is getting a bit crowded, though. Edward, who just turned 95, is still a fixture at the company, making his way into the factory multiple days a week. Jonathan and Michael maintain offices, and titles of executive vice president.

A retro company goes modern

If the Dee family and their products seem a throwback to a different era, consider that part of Liz's publicity job is growing the company's more than 1.2 million followers across social media, including their candy-colored Instagram. Another modern touch is part of the marketing message to Millennial moms: This candy is not only gluten-free, but also peanut-free, fat-free, and dairy-free.

Meanwhile, over the past year Smarties made some huge bets to modernize the manufacturing process, for example adding solar panels to the New Jersey factory--a process that's offset half of the energy used by the facility, which runs 24 hours a day, five days a week. 

Some updates haven't been entirely planned. The offices in the New Jersey factory hadn't been redone in many years, and prompted a lot of jokes about the Mad Men era by the younger Dees. But when a car crashed into the front of the offices in 2017, the family was forced to redecorate--at least partially. "Well, some of the offices are still pretty retro," Jessica says.

For its 70th year in business, Smarties decided to revamp the candy's logo for the first time in decades. "It was terrifying to change an iconic logo," says Liz, who noted that much of candy purchasing is impulsive, and sometimes tied to nostalgia for childhood. Still, the company wanted to brighten the look while retaining its vintage charm. This Halloween will be the first where the majority of the Smarties distributed bear the redesigned logo.

With the co-presidents of Smarties all in their 30s, the company likely will continue to be run by the fifth-generation of candy-making Dees for a long time to come. But, already, members of the sixth generation can occasionally be found visiting the factory floor, getting tours from Great-Grandpa. (These days, Rollerblades aren't allowed, and hairnets are required.)

Sarah and Jessica each have two kids under the age of 5, and they all love the little dextrose disks. Says Jessica: "I just find it so sweet when I come home from work and my daughter hugs me and says, 'Mom, you smell like Smarties!'"

Published on: Oct 30, 2019