KOKO BLACK
“Koko Black captures the authentic and timeless qualities
inherent to the art of fine European chocolate making.
Through it’s fine handcrafted chocolates, luxurious
surrounds and superlative service – Koko Black offers
moments of indulgence far beyond the every day”
Source Koko Black Chocolate website www.kokoblack.com
A successful small business case study
Shane Hills the founder of Koko Black, was
born in Tasmania and began his career at the
ANZ bank. After studying for a diploma at
Deakin. He later commenced a business degree
with Monash. Most of his learning came from
reading lots of business related books.
It was while Shane was studying at Monash
University that he met the owner of Suga, a
specialised confectionary retail shop, whom he
approached with ideas for growing the business.
Within ten days, Shane was operating his first
business by operating the Chadstone franchise of
Suga. Twelve months later the opportunity arose
to purchase the other two Suga stores and so
Shane joined forces with his father in law. Suga Shane Hills in front of a presentation of his
two companies “Suga” and Koko Black.
has now expanded to 5 stores and on the 12th
December 2003 Shane started up his new niche
Shane has a passion and love for
business, Koko Black.
chocolate as well as an innate sense of
adventure, enjoying the challenge and
rewards of taking a risk. On average he
works 50 – 60 hours a week.
In opening up the Koko Black business,
Shane was fortunate and incredibly grateful
for a small business grant from the City of
Melbourne to start up the business.
His aims with Koko Black was to create a
world class chocolate experience one that:
clearly differentiate his product and service
from any competitors
maintain production on site so that
customers could appreciate the freshness and
quality of the chocolates ( his truffles only
have a shelf life of 7-14 days),
The warehouse where the raw ingredients are
delivered to in Coburg
 to have a seating area which allows
customers to really enjoy the experience of
the chocolate,
 to specialise in making hot chocolate,
 and for the whole of the business to reflect
the sumptuous and indulgent experience of
European chocolate shops.
The manufacturing “creative” centre where the higher volume blocks and
truffles are made. Each of the individual “salons” (the individual retail
shops) still undertake 40% of the total chocolate production on site and are
much more than just an entertaining window display.
The chocolates from the manufacturing site are briefly stored in the
warehouse before being distributed to each of the individual salons in the
Royal Arcade (in the CBD), Lygon street, Bourke Road, Chadstone &
Camberwell.
Koko Black is run with a
minimal marketing budget,
instead marketing to
customers through the very
powerful “word of mouth”
experience that customers
pass on to their friends, the
visual and very enticing
shop front displays, and
through relatively free
exposure in media articles,
and their own website and
customer newsletters e.t.c.
A cabinet display in the store in Carlton
The front serving area in the Lygon street store, Carlton.
Shane believes that his staff are
vitally important to the success of
Koko Black. He selects on “attitude
and passion” rather than purely from
their Curriculum Vitae and is
looking for someone who can
complement the team and reflect the
very high levels of customer service
he expects from them. As evidence
of how well revered the company
now is, over 1000 applicants applied
for just 12 positions in his new
Chadstone and Camberwell stores.
The attention to detail in the
customer service in the store.
Store manager receive a quarterly
appraisal which includes a “silent
shopper survey” conducted by
customers. A key component of this
survey is the service standards Shane
expects and when these are achieved
staff are rewarded with a
corresponding bonus.
Preparing the trademark hot chocolate
with pure chocolate in every cup rather
than cocoa powder.
The objective of the
whole Koko Black
experience is to go back
in time where “high
quality service” was the
norm and not the
exception. Shane makes
a deliberate decision to
be professional in all
that he does and
maintain a standard of
excellence which he
expects from himself
and all his staff.
The selection of gift
boxes and speciality
chocolates that can be
bought within the store.
The target audience for
Koko Black and their
chocolates is females in
the 25-45 age group.
Approximately 70% of
the Koko Black’s
customers are female.
Koko Black Case Study Questions
Having gained an initial understanding of Koko Black from this photographic slide show, now construct
and analyse a business profile of Koko Black trying to understand how and why it has been so
successful.
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Describe the skills, experiences and attitude that Shane Hills appears to bring to Koko Black.
Outline the advantages and disadvantages of maintaining 40% of production within the
“salons” as well as at the manufacturing “creative” centre.
Analyse the advantages and disadvantages of maintaining such a minimalist approach to
marketing the business.
Describe the layout and appearance of the “salons” from these photographs. What feelings,
impressions and image are created?
Explain why Shane Hills would select staff more on the basis of their “attitude and passion”
than their CV (curriculum vitae).
Research what is meant by a “silent shopper survey” and then analyse the advantages and
disadvantages of using this technique as part of a staff appraisal.
Identify the macro and operating factors that may impact on this business in the future.
Construct a basic SWOT (Strengths, weaknesses, opportunities, threats) analysis of Koko
Black as a result of your initial case study analysis.
In your opinion as a result of your analysis what are the key factors that you believe make
Koko Black successful?
As an extension exercise conduct further research into this companies success. Sources of
information and website questions are provided shortly, or alternatively organise an excursion
to one of the salons to understand more about this company.
Additional case study research material can be
researched from the Koko Black website
www.kokoblack.com, and Shane Hills and
Koko Black are also reviewed amongst a
group of other successful small business
owners on the CPA DVD “Lets Plan A
Business” 2004.
Website questions – www.kokoblack.com
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Open up the company website, www.kokoblack.com, and click on
the link to “Our Heritage”. Develop a short profile of the skills,
qualities and experiences the three main employees bring to the
business
“Our Founder”- Shane Hills,
“Master Chocolatier”- Arnos Backes,
“Our Service” – Nillanka Nanayakkara,
Explain why you believe these three individuals would complement
each other so well in the success of the Koko Black business.
Click on the link to “Our Salons” and write down the locations of
the four main stores and their opening times. Now try to work out
why these locations were chosen and why their opening times may
differ?