inspirational

The Millionaire and his Candy

by Paul A. Schons

Originally published by the Germanic-American Institute in February, 2003.

Hans Riegel is the 92nd richest man in Germany with a fortune estimated at 800 million dollars. The bulk of the fortune has been amassed since 1946. And from where can such an amount of money come? Would you believe, gummi bears?

The father of the millionaire of today, Hans Riegel senior, was born in a village near Bonn in 1893. He became a poorly paid worker in a candy company, Kleutgen & Meier in Bonn-Bad Godesberg. On December 13, 1920 he decided to try his hand at starting his own candy company. His only co-worker was his wife Gertrud. Their start-up capital was a bag of sugar, a marble slab, an oven, a kettle and a rolling pin. They made hard candies which Gertrud delivered to customers in Bonn each day in the basket of her bicycle. The name given the new company was Haribo, an acronym for HAns RIegel of BOnn.

The Riegels noticed the popularity of a gelatin fruit candy competitors were selling and thought that line might be worth a try, but realized the need for some sort of a competitive edge to enter the market. What might children like? One afternoon in 1922 the idea came to them. They could mold the fruit flavored gelatin into the form of a dancing bear (Tanzbär). With that simple little idea a product was launched which would eventually become a worldwide favorite and build a family fortune. The original dancing bear was taller and thinner than the chubby little bear of today, but became immediately popular among the children of Bonn. The conversion to the current shape of the Gummibär was made in the 50s.

Gertrud Riegel continued to deliver each day on her bicycle, but by 1923 the business was growing quickly enough that the Riegels took the risk of an investment in a car. During the next years they made variations of gummi shapes. In 1925 another breakthrough was made with the introduction of Lakritz-Schnecken (liquorish wheels). By 1930 the company employed 160 workers. By the start of World War II there were 400 workers producing over 10 tons of candy each day.

The war was a disaster for the company. As supplies became harder and harder to get, the production dwindled. The company had only a handful of workers by the end of the war and for a short time production stopped altogether. Hans Riegel died on March 31, 1945 and the family’s two sons were prisoners of war. Gertrud Riegel struggled alone to try to keep the enterprise alive.

In 1946 the two sons came home with a resolve to rebuild the company. Hans Jr. was the innovative businessman (Ph.D. in economics) and Paul was the operations wizard with an ingrained talent for the technology of candy making. By 1950 the company employed 1,000 workers. In 1957 they took over Kleutgen & Meier, the company where their father had worked in his youth. In the following years Haribo acquired additional candy companies, Maoam in Düsseldorf, Dulcia in Belgium, and the Lebkuchen (ginger bread) company Bären Schmidt in Nürnberg as well as the sugarless gum company, Vademecum. Haribo has production companies today in Germany, Finland, Sweden, Norway, Denmark, Holland, England, Ireland, Belgium, Austria, France, Spain, Italy, Poland and Turkey.

Until 1982 sales in the United States were made through a variety of U.S. distributors, but in 1982 Haribo set up its own sales and distribution organization in Baltimore, Maryland. The general manager of the Haribo of America is Christian Jegen. Building on the popularity of the little bears in America, a number of companies produce variations of the confection today. The exact ingredients and production technology of the Haribo bears remain, however, a closely guarded secret and cannot be duplicated exactly.

Haribo now produces 80 million gummi bears each day for worldwide distribution. The company is organized as a private partnership (Kommanditgesellschaft) with Hans and Paul Riegel listed as the directing partners, although Hans Riegel is clearly in control. He is a micro-manager attending to many details of company business personally. He claims that he has never used marketing studies or consultants, but rather develops products by his own sense of what might sell. “Ich liebe Kinder, ich beobachte sie gern. Sie sind meine Kunden. Ich muß darüber informiert sein, was sie naschen wollen, was sie denken, welche Sprache sie sprechen”(“I love children, I enjoy watching them. They are my customers. I must be informed as to what they would like to snack on, what they think, the language they speak.”) To keep close to the minds of children he reads comics, watches children’s TV programs and reads children’s magazines.

The third generation of Riegels is now at work within the company. Paul Riegel has three sons who are active. Hans-Guido Riegel works with his father in production management, Hans-Jürgen Riegel is the manager of Haribo’s operations in France and Hans-Arndt Riegel is an attorney at company headquarters in Bonn.

The company’s slogan, “Haribo macht Kinder froh!” (Haribo makes children happy!) was adopted in the 30’s by the original Hans Riegel. Hans Jr., not wanting to fix something that isn’t broken, has kept the slogan, but in the 60’s added the phrase, “und Ersachsene ebenso” (and adults likewise). (He is known to frequently take a handful of gummi bears off the production line for his own adult enjoyment.)

Haribo has 5,000 employees at the present time. Although a private company such as Haribo need not divulge financial details, it is estimated that the annual sales amount to a half billion dollars each year. The company now has 200 products on the market. 78-year-old Hans Riegel, who flies his helicopter himself on his frequent visits to Haribo sites in Europe, commented recently on the size and success of the company, simply, “Die Firma ist eben sehr groß geworden.” (The company has grown very large.)