Author of Ed Engoron’s Choclatique, Running Press, 2011
Volatile stock market prices, political unrest and export bans are the very serious world issues we might like to take a break from with a couple of Choclatique truffles. But now some of those headlines are affecting our very escape and my business.
It started in the major growing areas of Africa and because of political issues and an export ban in the Ivory Coast, which produces nearly half of the world’s cocoa beans, there has been a domino effect of rising costs. Cocoa prices have hit their highest in more than 30 years. When Joan and I Joan first started Choclatique in 2003, cacao was priced at $1,800 a metric ton; recently, the price soared up to $3,800.
Now we are forced to ask ourselves: How much do we really love chocolate—enough to pay more? While Choclatique has experienced a gradual rise in its prices, we have resisted passing them along to our customers. But even with record Valentine’s Day sales, we are reluctant to increase our prices to keep up with the rising costs due to current gas prices and the continuing troubled economy.
You might think that increased prices really have no effect on what price we sell because people love our chocolate, but that’s just not the case. We realize that consumers, unlike the government that prints money whenever it needs it, have a finite amount of money they can spend for even affordable luxuries and people are reluctant to pay even a little bit more for them. However, we have been monitoring price spikes and future hikes coming, and if it gets more dramatic, it could be a problem.
The concern isn’t just for us little guys, either. The whole chocolate and confection industry is facing some pretty severe cost pressures this year. If prices stay at these levels, then you should expect that it will get passed on to the consumer, either with some price increase or package size reductions.
At this point, chocolate is not a prohibitively expensive luxury like caviar, although some experts say that day is coming. Right now, even the cost of artisan, handmade chocolates hasn’t gone up everywhere.
We haven’t raised prices because we are just trying to keep everybody happy with Choclatique. We’re making a little bit less, but we are keeping people in the habit of still purchasing Choclatique Chocolate. While it’s eating into our margins, we are hopeful that chocolate prices will come down over the next six to 12 months.
We have enough inventory of chocolate that it won’t be a big concern for Easter or Mother’s Day. We have all the chocolate we need through May. But down the road, it could be a serious issue as we approach the year-end holidays.
For now, whenever the woes of the world and the economy here at home start to get you down, just relax, take a Choclatique truffle and let your mind wonder for a few minutes. Trust me, I am the doctor, the ChocolateDoctor, you’ll feel better… take two truffles and call me in the morning.