TAZA Chapter 14
PHK BUSINESS (11e) VIDEO SERIES FINAL (10/11/10)
EDITOR: A. Grazioso
SEGMENT: Chap 14: TAZA Chocolate
(Marketing: Retail/Wholesale)
VERSION: Final (10/11/10)
Page 1 of 3
As of: 2/17/16
Interviewees
Alan Whitemore
Co-Founder/Co-Owner
Larry Slotnick
Co-Founder/Co-Owner
Stephanie Larason
Outreach Manager
Michael Shchechter
Director of Manufacturing
<start>
My name is Alex Whitmore. I’m a cofounder at Taza Chocolate. Taza is a bean to bar chocolate
manufacturer based in Somerville, Massachusetts. We make a very unique, stone ground,
organic chocolate in the Mexican chocolate-making tradition we actually make the chocolate
from scratch, from cocoa beans, we roast the cocoa beans, we winnow them, we grind them into
a really unique style of chocolate. We manufacture chocolate bars, Mexican style chocolate
discs, chocolate covered nuts. Our products are carried in specialty and natural food stores
around the country, and online at tazachocolate.com. But
My name is Larry, I’ve been our director of sales since we started the business back in two
thousand-six. My role has been trying to figure out how to get a brand like Taza’s spread out
throughout major, metropolitan areas around the country. This involves understanding who our
competitors are, understanding what the appropriate retail channels would be for our kind of
product and our brand.
Chocolate is an extremely competitive category. If you go into a Whole Foods store or any
grocery store really, you’ll see on the shelves a wall of different chocolate brands, flavors,
products of all different types from all over the world. And we manufacture a chocolate that’s
really different in that it has a very coarse texture, and a very intense flavor that you just won’t
find in most chocolate bars on the shelves, especially here in this part of North America where
most consumers are used to eating European style chocolate.
I spent the early year really just walking around to local stores with sample of our product and
really almost going door to door.
After Boston was sort of getting going with maybe forty or fifty retailers, I started doing some
travelling to San Francisco. I’d do some research and have a list of the stores I wanted to visit
I’d usually borrow a friend’s bike out there so I could get around really quickly from store to
store, neighborhood to neighborhood, abd then you have to be a business that prepared to be
pretty generous to sending samples.
Submitted for review by NKP Media Inc.
TAZA Chapter 14
PHK BUSINESS (11e) VIDEO SERIES FINAL (10/11/10)
We’re manufacturers, so we have to do volume, that’s the name of the game. We, for the most
part, are wholesaling our products. We have to sell it wholesale, in large volumes, by case and
master case quantities of product.
Page 2 of 3
As of: 2/17/16
We work directly with retailers, where we ship actual product to them retailers such as Whole
Foods, wine and cheese shops, natural food co-ops, we think, somewhere in the range of eight
hundred to a thousand throughout the country.
But we also plan two other price channels: the distributor pricing, which is priced below
wholesale pricing, and we also sell it retail, full retail price which we do mostly online, but we’re
just about to open a factory store here.
When you’re selling to a wholesale customer, the value of the order is several hundred dollars,
sometimes several thousand dollars, and you’re just dealing with one customer,
there’s usually a forty to fifty percent mark-up between wholesale sales and the price that it ends
up on the retail store shelf, the retail price. So, say we sell a chocolate bar for four-fifty, we’re
actually selling that, if that’s the retail price then the wholesale price is going to be somewhere
around two-seventy for that unit, which is a big difference. And then the distributor price… even
lower, maybe around two dollars.
Chocolate as we all know melts when it gets hot enough. In the summertime to get a 250 dollar
order to a store that’s in California and going to cost someone 35 dollars to ship. 2nd day air. Put
some insulation in the carton with maybe an ice pack so it gets there in good condition. Having a
distributor in California that has a couple of thousand dollars of inventory in their refrigerated
warehouse all the time changes that equation. It means that the store can just order from that
distributor, pay about the same price that they would pay if they ordered directly from us. Get
the product probably the next day, much lower shipping cost. Maybe free shipping even.
So having distribution being a component of our overall sales and marketing we think is critical
to the type of product we’re selling.
But wholesale will always be our bread and butter, where we really move the volume and we
have good margins.
Direct trade is a model that is designed to incentive-ise quality much more than fair trade is,
which is very important to us. It’s also, we think, better for a company of our size to really work
directly with the producers and not just buy through a broker. A higher price is paid than fair
trade, and we know that the quality is going to be the best that there is.
We’re a premium brand, and because of the way we do what we do, we have to charge more than
your average chocolate bar.
The shelf life’s of our product range between six and twelve months, which allows us to over
manufacture during slow periods to prepare for very busy periods like quarter four, where we’re
selling chocolate faster than we can make it. So we’ll start manufacturing chocolate in quarter
three to prepare for the onslaught in quarter four.
Our chocolate is shipped all around the country. I think we are in 40 plus states, we do a bit of
shipping into Canada. And a very little bit of shipping into Europe. We’re in Germany, Sweden,
Norway, UK.
Submitted for review by NKP Media Inc.
TAZA Chapter 14
PHK BUSINESS (11e) VIDEO SERIES FINAL (10/11/10)
You could probably find us in at least forty of the fifty states, if not, forty-three, forty-four states.
Page 3 of 3
As of: 2/17/16
[END]
Submitted for review by NKP Media Inc.