(Yicai Global) Feb. 11 -- Much-loved US chocolate maker The Hershey Company has denied a report that it is quitting China, saying that the market is too important, according to financial media Caijing.

Hershey’s is not planning to leave the China market and business is continuing as normal, the chocolate maker’s China branch said today. Any product shortages are due to the soaring sales during the week-long Lunar New Year holiday that just ended, it added.

Hershey’s has been reducing its headcount and scaling back its business in China since 2020, Beijing Business Today reported on Feb. 9, citing a company insider said. It has been troubled by disputes with some distributors.

The Pennysylvania-based firm has closed its online store on e-commerce giant Alibaba Group Holding’s Tmall platform and most of its products are out of stock on e-marketplace JD.com, the report said.

Hershey’s is working with distributors to ensure a stronger presence in online channels and brick-and-mortar outlets and new distributors will come on board, the China branch said. The Tmall e-store is undergoing a revamp and will reopen by the end of the month.

Hershey’s sales in China have been sliding in recent years. In 2020, while global earnings climbed 2 percent from a year earlier to USD8.2 billion, China sales slumped 46 percent. Although China revenue for 2021 has not been disclosed, the company’s international sales amounted to under 8 percent of the firm’s total sales.

Hershey’s will start to put more of an emphasis on imports, rather than local production, the firm said. It will also diversify into snacks to tap into newly emerging dining channels.

Editor: Kim Taylor