A Small Player's Chocolate Supplier Problems

[Edward J]

My whinging is centered around purchasing couveture.

O.K., I'm a small player artisan chocolates and pastries, a retail shop/production facility of under 950 sq ft. When it comes to chocolate, Vancouver is a Belgian town, people consider only Belgian chocolate to be "the best". I, being Swiss, beg to differ and have gone to great lengths to obtain and use "X", a Swiss couveture.

For the first year, I was getting my couveture through "Y" a large and reputable baking and pastry supplier here in B.C.. "Y" was breaking the 10 kg cases into 4, 2.5 kg pouches and selling them by the pouch. Taking full advantage of my 12 year relationship with "Y" in my previous business, I was able to obtain a $3.00/kg price reduction provided I order in multiple full cases. A year later I was ordering in 50 and 60 kg shipments but try as I might, could not get any further price reductions. In fact, I would have to listen to, and call "Y"'s bluff every time they told me that "Prices have gone up". Always called the bluff, always won, but never got further price reductions.

By January of this year I called "X"in Toronto and manged to wrangle an appointment with thier Western Canada sales rep. By committing to a set quantity over a 12 mth period I would get my couveture direct from Toronto at set prices. Problem was, they gave me prices virtually identical to "Y"'s prices--less than $1.00/kg difference. (Well, whadja expect? They treat "Y" like a regional distributer, they wouldn't let a small guy like me mess up their pricing structure...)

What the hey, it was a bit cheaper, but more importantly I would be building a relationship with the Canadian branch of "X". So mid January we ordered over 120 kgs of product, expected delivery time: 3 weeks. February comes, and goes, I have to order through "Y" to get product for Valentine's day. March comes, and goes, no delivery I gt ticked off, I ask where my product is. I'm told they're "still processing my information". Well, geez, it's not like I'm adopting a baby, how much time do you need? When will I get my shipment? April 12th, I'm told. Fine, I say, I missed out on Valentine's day, now I'll miss out on Easter. April 12th comes, and goes--no couveture. I raise he**, April 15th I get my order, only problem is, out of the 4 types of couvetures I ordered, they "substituted" the 54% with a 52%. No notification, no explanations no apologies.

O.K, O.K. punishment of the "original sin" of being small, l know. Thing is, I haven't had such royal treatment since "Freshie week" in grade 9 when I was in high school....

By end of May our stock is running low and it's time to order again, about the same quantity. I ask for a delivery date. June 8th I'm told. June 8th comes, and June 8th goes, no couveture. On the 9th I get the invoice via Canada Post. I make inquiries with Toronto . No reply from my sales rep, no reply from the Sales director. I try the shipping dept.: "Oh, that order was shipped out, we heard from the transport company in Vancouver, they tried to deliver, but you were closed that day." Yes, Virginia, Monday's we are closed. But that little golden nugget of information was on my credit application and customer forms,. Remember, the forms d you took 31/2 months to process?

So the delivery Co. tried to deliver on the 8th. It's the 11th now, and I have no idea where the couveture is, neither the delivery co nor "X" Canada has attempted to contact me.

I 've got a sinking feeling my couvture is in the back of a truck--in 28 C weather, doing the milk run for 3 days.

Rant off. Time to walk the dog.....

[JeanneCake]

I think as soon as they gave you a delivery date of June 8, I would have said, we're closed on Mondays but if you give me a window for delivery we'll be here.

The aggravation of dealing with them just isn't worth it. They seem to be jerking you around and they know they can get away with treating you poorly because where else can you go? I'm a small (tiny!) business myself and yet the reps from each company I deal with treat me well; as if there is no difference between the small amounts I purchase and the accounts who buy $5K every week so it isn't just that your business is small, it's the integrity of the people you're buying from.

What are the chances that X and Y are in cahoots?

[ejw50]

I agree with Jeanne, who does great work by the way. She returned (or was going to return) a package of white chocolate to her vendor because it smelled old. I think a lot of companies would not take that return.

At my company, we do a lot of purchasing, computers and otherwise. Our purchasing department has learned to live with a few extra dollars of cost in exchange for no hassles and no hassle return policies. The time you lose (and opportunity cost you lose) in mistake purchases is just not worth it.

Edited June 12, 2009 by ejw50 (log)

[Edward J]

What are the chances that X and Y  are in cahoots?

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Cahoots?

"Y" is the sole distributer for "X" (for bulk couveture, anyway) in this province, which includes the lower mainland, Vancouver Island, and the interior. I believe that they're in love with each other.

So, my choices are 3:

1) Go with the status quo here in Vancouver, and use Callebaut. Most places use the cheap d8-11 and get away with it. "Y" doesn't carry Callebaut. I have three other pastry and baking suppliers to choose from, let's call them A, B, and C. I know of several small-ish producers who are bringing in their own Callebaut from Europe. Now, A,B, and C (the other suppliers) are giving me a "special quantity based price" with mark-ups ranging from 65% to 90% on basic Callebaut d8-11 or 60/40-- almost $1.00/kg MORE than what "Y" is charging me for "X" product. This is like comparing a Tercel to a BMW for the same purchase price. No deal, besides, I hate the stuff anyway. I like to keep track of these guys, A, B, and C, and check on their prices from time to time. the prices rise around Christmas, and fall in late summer. Slime balls...

Conclusion to choice 1. It still is cheaper to use "X" from either "Y" or "X" Canada. The product is far, far superior to what A,B,C and C are using for the same price. I have operated for two years using "X" and have developed a local "following", if you will. My business has grown--moderately, but grown. "Y" has every right to charge a mark-up, which I estimate somewhere around the 30% range. They don't fluctuate their prices much, mainly because I catch them when they do.

2) Go back to "Y" and try to negotiate a new deal. I might try this, but they know I'm too small to bring in container of product a time, they won't go down on price, and I don't like bargaining if I don't have something to bargain with. Even if my quantities are slowly rising.

3) Stick with "X" Canada. Still looks like my best bet, inspite of the "Royal treatment". When my quantities do increase I have it written per contract to re-negotiate the prices. Dreaming is free, and I dream of achieving this in maybe 2 years time .

Yeah they're jerking me around and I rub their noses in it. As a small player there are very few perks, catching sales reps lying or cheating is one such perks--there are no free ball-game tickets, trips to France, or arranged pastry school visits for small guys. Catching a rep in an awkward position is the only perk (other than a free calander every year...) so watching them squirm avoid phone calls and e-mails has some entertainment value to it. Also, knowing they can't cash in on their commission untill I actually pay them is another perk, and I still haven't got product, so no moolah.

I can still read and write in German, so maybe a letter to Switzerland might do something for me --or not.

[Lior]

Have you heard of this guy? Tried his chocolate?

Brad Churchill

If not, it may be worth a look into.

[Edward J]

Maybe...

There is actually a bean-to-bar producer here in Vancouver, gets his beans from Peru, I believe. Nice stuff, but he doesn't sell anything locally, 99% of his market is small private labeles in the U.S. I approached him a year ago, wanting a price on bulk couveture. After 9 mths he finally gave me a price. It was in ball-park range, but he's not ready to commit to actually supplying me, he says maybe next year.....

[prairiegirl]

Edward,

I would be curious to know who you are going thru. There are only so many companies selling chocolate. I am in Calgary. Bean to bar..none in Canada that I would consider good quality. DC Duby would be the only ones that I think have the proper technical smarts to do a great job. I want to get into the bean to bar business eventually just as an added bonus to the business. People are fascinated with the process.

[schneich]

puhhh... looks like a hard life :-/

here in germany i make one phonecall to valrhona, and 6 days later the schtuff arrives fresh from the rhone valley :-) what couvertures are you talking about, and what the price per kilo ??

here we pay around:

€ 10,- for felchlin maracaibo clasificado 65%

€ 10,- for felchlin maracaibo creole 49%

€ 15,- for amedei fondente extra 70%

€ 8,- for chocovic ocumare criollo 71% (--- our workhorse, great stuff!!

€ 6,- for belcolade caramel, simple 55% and single origin costa rica 38%

€ 6,- for valrhona tropilia 70% (--- our workhorse in the pastry shop!!

€ 10,- for valrhona equatorial

€ 14,- for coeur de guanaja 80% (---- we use it for SOME chocolate mousses

cheers

t.

[Lior]

Do those include tax? I pay similarfor Valrhona gran cru but with tax it comes to about 18 €. Is the tropilia on the same level as callebaut more or less?

[schneich]

its without tax since we dont have to pay any tax (EU wide) the tropilia has a lot more depth to it than the simple callebaut dark chocolate wich is quite one dimensional, even compared to the satongo, already quite a good chocolate its still better balanced...

[Lior]

Nice!! We have Tropilia here but I thought it was more like Callebaut! No taxes! On all bought products or just chocolates?? How can that be?

[Kerry Beal]

Nice!! We have Tropilia here but I thought it was more like Callebaut! No taxes! On all bought products or just chocolates?? How can that be?

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No tax on bulk ingredients in Canada either.

[Lior]

lucky guys! We pay 15.5% on everything bulk or not. Not fair!!

[Edward J]

Felchlin is virtually un-obtainable to get in Canada--no distributers, bulk container shipments only. Quite a few purveyors carry Carma products, but no couveture. Frey (Migros chocoalte) likewise has no distributer, and would like to send me couveture--but alas only in containers. Haven't really tried their couveture anyway.

So, by process of elimination, you can guess which brand "X" is.....

I am familiar with all pastry and baking purveyors here in Vancouver, the only one I can actually trust is my own "Y", which happens to be the largest.

Valrhona is only distributed by one purveyor (a.k.a "A") and the going rate for Troplia is around CDN $22/kg. I don't like this purveyor, prices fluctuate waaay too much, and the sales rep tried to fob off some house brand with a past exipry date on me. I asked him to examine the other side of my door.

Cluizel is likewise only distributed by one purveyor (a.k.a. "C"), far too expensive to use --for me anyway.

Chocoa isn't all that bad and I was using it for ganaches and the like, the 72% was good for this purpose, sugar milling in the milk and white was very grainy though, and I don't like those. I originally paid $7.90 a kg for the 72%, and within a year the purveyors (a.k.a. "B", the second largest purveyor with multiple branches in CDN and the US) jerked the price up to $11. closely following Callebauts price hike. At this point it made more sense to use "X" at a dollar a kg more for everything.

So, most pastry baking places either are large enough to bring in containers of product on thier own and by-pass the purveyors, or small and pay the price. I'm somewhere in the middle........

Praire girl, there are two "bean to bar" producers here in Vancouver. One is very large and produces excrement--"baking chips" and the like. The other is very small and produces a good product. I've visited his operation, saw the beans, the mills, the conching machine, and his product is good. He just doesn't think it profitable to sell me couveture in 100 kg lots at the moment. Like I said, virtually all of his product goes to private labels in the US.

Don't know about Bernard Callebaut in Calgary, legend has it that he is bean to bar, haven't visited his operation--yet. And there's some other guy in Calgary or Edmonton who's putting Omega 3 oils in chocolalte, but I'm pretty sure that's contracted out.

For the record, I'm still waiting for my couveture.....

[schneich]

i meai really guys we arent we put things togehter and sell chocolate in canada :-) a frined of mine sells container space its really not that expansive... you would pay half if you FLY it into canada :-)

cheers

t.

[ElsieD]

Felchlin is virtually un-obtainable to get in Canada--no distributers, bulk container shipments only. 

I have purchased Felchlin in Canada. I live in Ottawa, and just across the river in Gatineau there is a wholesaler from whom I have bought it. If it interests you to contact him, his particulars are:

Kurt Schmid

Import-Export

25 Rue Audet

Gatineau, Quebec

819-771-9940

Note that I have no vested interest in his firm. He has various chocolate so maybe you can get what you need from him.

[Sebastian]

Ed - i've got a fairly good understanding of the supply chain and the people who play in it - if you'd like, email me with whom you're using and i might be able to suggest some folks for you to talk to that you're not already working with, if that helps.

[prairiegirl]

Ed,

Bernard Callebaut is not bean to bar. He has his own formula and he gets Callebaut in Belgium to make it for him. And I imagine he gets a sweet deal because his family were the founders.! Also keep in mind that Bernard Callebaut the man does not make chocolates any more. He just supplies the name and maintains himself as the image.

I have Felchlin and I get it through H.U.H. imports in Toronto. I know that Lentia has brought in pallets of Felchlin for customers who have asked. I have a wonderful rep here in Alberta from Lentia. PM me if you want to know the prices. I have my receipts filed (somewhere?).

[prasantrin]

Don't know about Bernard Callebaut in Calgary, legend has it that he is bean to bar, haven't visited his operation--yet. And there's some other guy in Calgary or Edmonton who's putting Omega 3 oils in chocolalte, but I'm pretty sure that's contracted out.

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I once asked a Bernard Callebaut staff member about the couverture--if it was just Barry-Callebaut or some other kind. She said it was manufactured by Barry-Callebaut but it was a special blend made for BC. I'd ask again, though.

His couverture is quite expensive retail. If it is indeed a special blend for him, or even if he makes it himself, I can't imagine wholesale would be that much cheaper than his retail prices.

[prairiegirl]

Don't know about Bernard Callebaut in Calgary, legend has it that he is bean to bar, haven't visited his operation--yet. And there's some other guy in Calgary or Edmonton who's putting Omega 3 oils in chocolalte, but I'm pretty sure that's contracted out.

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I once asked a Bernard Callebaut staff member about the couverture--if it was just Barry-Callebaut or some other kind. She said it was manufactured by Barry-Callebaut but it was a special blend made for BC. I'd ask again, though.

His couverture is quite expensive retail. If it is indeed a special blend for him, or even if he makes it himself, I can't imagine wholesale would be that much cheaper than his retail prices.

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Bernard is a retailer not a wholesaler. I and Bernard have mutual friends and that is correct he gets his own blend (formula) made through Callebaut in Belgium. He does have family members employed by Barry Callebaut. It would be way to expensive to purchase anything from Bernard Callebaut. His website is self explanatory.