
From closer:

Little people (most probably elves, but it's not been verified as of yet) are harvesting the ingredients
They take them to town, to Pepparkakeland
Here we are in the factory: important ingredients of pepparkakor are milk, Christmas peace, sugar, syrup - stored in the big containers
Decorating and packing the ready pepparkakor
Shipping
Pepparkakor to every corner of the world!

You will see even constructions sites decorated...
Christmas market in Gamla Stan (Old Town)
Cinnamon sticks for sale
Window display of the huge department store of Stockholm, NK