Theo Chocolate

Submitted By:- Payal Patel Sai Kiran Mimani

Case Synopsis

Theo only organic, Fair-Trade, Bean-To-Bar chocolate factory in the United States. The company was recognized because of its local identity and fair trade practices. The company ran in losses but in 2009 ran out of cash to further operate and now Joe is wandering what to do????

Case facts Theo Chocolate (named after the Greek name for the cacao tree, Theobroma Cacao or “food of the Gods”)

Theo Chocolate began producing its first Fair-Trade certified, single-origin, blended dark chocolate bars in March of 2006.

By the fall of 2009, had built a unique brand.

Its first few years were unprofitable as the company made investments in plant, people, and marketing.

He wanted to increase the perceived value.

Then in 2005, a group of investors with interests in some of those companies decided to partner with Joe.

Joe had little trouble finding smart people to come work.

Adult supervision was missing.

Case facts They spent the next 18 months building the factory in a historic building.

The former home of the Red Hook Brewery, in the quaint, eclectic and artsy Fremont district of Seattle.

In March 2006, the company began producing its first Fair Trade-certified, single-origin and blended dark chocolate bars at that factory.

FY2010 might be Theo’s first profitable year.

Case Facts

Sales percentage compared to the next quarters

Sales structure, Source of revenue

Case Inference Joe was proud of this value chain of making chocolate

Different products Theo chocolate had to offer and how much revenue that was generated by each one of them

Case Inference

Competitors that were present in the market were many and they were well established in the market. Most of these companies were able to sell in the market individually and still sustain.

Case Problem

Should the company stay true to its socially- responsible roots to make profits?

What are the alternatives to generate revenue

and stay in business?

Immediate Solutions •  To keeping social responsibility in mind, Theo can reduce

the weight of the chocolate and sell at the same price. •  Increase the cost of tour of the factory and also the

number of persons. • Ever person who comes to visit the factory then he/she has

to buy $X values of chocolate which would be of premium variety and exclusively available on the factory outlet only.

Long term Solutions • Apart from the niche segment they can target the main

stream • Expand their distribution to other states in US.

• Develop their own organic farms

Merci Beaucoup