A love for chocolate has been inculcated in American society as far back as one can remember. This attitude was born in late 1800’s as large scale chocolate companies like Mars and Hershey’s rose to the forefront. It has only grown since its introduction over 100 years ago with over $22 billion of chocolate purchased by Americans last year alone (Statista 2018). Chocolate is indelibly associated with numerous holidays and is remembered by many as a fond childhood treat. Many of these associations held by the public for chocolate consumption were strategically reinforced by chocolate companies in an attempt to permanently define a stronghold of the market for their good. Yet what easily goes unnoticed, and actively hid by candy conglomerates’ targeted marketing campaigns, is an industry marred by a history of slavery, child labor and unsustainable practices. Legislation and fair trade organizations have made clear efforts to bring attention to and correct a seriously flawed supply chain model. But with a multibillion dollar market dominated by five big players worldwide pining for cheap cacao to service their production, efforts motivated by NGO’s have not been enough to solve all the market’s severe issues.
What has surged in recent years is a market for quality chocolate and a rise of companies that challenge a longstanding history of mistreatment and unjust practices. Confectionary categories since the early 1900’s have been dominated by chocolate with relatively low quality cocoa and a high sugar content in the United States. However, in recent years there has been a demand surfacing for “premium” chocolate, which is defined by the NCA as least $11 / pound, that is not produced by these well known large production candy companies. For instance, in 2018 premium chocolate sales grew 10%, marking a fourth consecutive year of substantial growth while total chocolate only grew 4% (New Hope Network 2018). This growing demand for quality chocolate marks a key reversal in market trends. Similarly, a growing desire for quality chocolate comes with a growing need for new companies committed to sourcing production of the best kind and of the best practices. One of these companies is Dandelion Chocolate. By devoting the time and resources to ensuring quality in their cacao beans, Dandelion meets a market need while actively fighting the problems deeply rooted in the chocolate industry. A close analysis of Dandelion Chocolate’s business model reveals how small batch, high quality chocolate producers that care about social and economic change can serve as a solution to a corrupt production market. Given the growing premium chocolate market worldwide, Dandelion’s approach makes this a viable model for mass adoption.
In order to understand why Dandelion can serve as a model for an entire industry, it is necessary to know the company’s business model and mission. The company prides itself in its bean to bar small batch chocolate which uses only two ingredient, cocoa beans and organic cane sugar . They produce chocolate out of their factory in the Mission District of San Francisco and sell them for about $10 per bar. In the company’s 2016 Sourcing Report the founders explain that their commitment is a simple one that comes at no small cost:
“We travel to origin as frequently as possible to learn about our producers’ best practices, exchange feedback, and make sure that high standards of quality and sustainability are met. We pay a premium far above the world marketprice …. We believe that good business practices can help foster positive social, environmental, and economic change, and we are committed to increasing transparency in both our own process as well as across the supply chain”(Dandelion Chocolate 2016) .
These claims regarding their practice are further supported throughout their website. In 2016 market price was $2,892.16 per tonne and the average price per tonne that the firm paid $6,599.00. A willingness to pay more for quality is the key to supporting positive change in the labor market and environmental spheres and what drives the premium chocolate market. Examining this statement with respect to Dandelion Chocolate’s relationship with its producers demonstrates how they actively fight market wide injustices against the people who drive the industry.
First, to comprehend how Dandelion Chocolate’s model for supporting producers fights abuses against labor in the chocolate market it must be understood how pervasive and deeply rooted the issue. By looking at how profoundly imbedded violations against workers rights are in the process of producing chocolate it is made evident that a targeted approach like Dandelion’s is necessary. Corrupt labor practices in the production of chocolate date back to 1500’s when the Spanish introduced the “encomienda” system (Martin 2018). This system forced indigenous inhabitants of newly conquered Spanish America into slavery, subjected them to horrific working conditions and eventually led extreme demographic collapse. Due to dissent from clergy the use of indigenous people as forced labor was made illegal by the crown and a new labor system was introduced. “Chattel slavery” was the decided solution and resulted in 10-15 million enslaved Africans survived forced transport across the Atlantic between 1500-1900. During these years African slaves were forced to work on plantations for 18 hours per day harvesting commodity crops like rum, sugar, tobacco and cotton in addition to cacao. The conditions endured were so horrific that the life expectancy of slaves living in the Caribbean and Brazil was only seven to eight year. The use of slave labor in Latin America continued until the end of the 1800’s when disease spread across the chocolate crop and slavery was made illegal. The scarring history with chocolate people throughout the continent dissuaded the continued production of chocolate and the bulk practice was instead relocated to the Gold Coast of Africa.
Although the center of production changed, the movement of cacao had no impact on the quality of work conditions for many works. Cacao was introduced to the African continent in 1819 when the Portuguese brought it to the island of Principe (Martin 2019). From the beginning, the Portuguese used their colonial holdings in Africa to support their economic status as an empire and this resulted in severe abuses of the local population. Portugal enslaved nearly half the population of Angola and implemented a process oriented towards shipping slaves to cacao plantations on the islands of Sao Tome and Principe (Satre 2005). For many natives, the word Sao Tome was synonymous with okalunga, meaning hell. Through this system the Portuguese government produced ⅕ of the world’s cacao in and was the primary supplier for Cadbury chocolate, one of the world’s largest chocolate sellers at the time. This system continued up until 1909 without a call for an end by the outside world. As the world began to demand changes to the Portuguese slave practice production fell away from these islands began in other African colonies. Ghana and Cote d’Ivoire became the world’s primary chocolate producer in the 1900’s. However, there were still instances of forced labor being used in Bioko and Cameroon in the twentieth century while slavery persisted in Sao Tome and Principe until 1962 (Berlan 2013).
While enslaved workers were not the primary labor force in the other countries that began producing cacao across the Gold Coast, norms which had been established when slaves were the dominant source of labor on plantations had not destroyed. After years of paying for dirt cheap cacao, the primary buyers of cacao required a similarly low priced product in order to maintain their profit margins. The degree of control set by the sellers of chocolate products back in the 1900’s has carried through to today. As a result, chocolate farmers are subject to incredibly low market prices for cacao that are also subject to great volatility. In order to meet the demands of large scale chocolate sellers, farmers must cut costs across all means and laborers face the consequences. In 2015, the average income of a Ghanaian cacao farmer was $0.50-$0.80 per day with the poorest farmers making only $500 per year (Ryan 2011). This painstakingly low income for cacao farmers is not only felt by farmers in Africa but is also shared throughout the world by farmers subject to bottomline prices for the product.
As a result of the low incomes cacao producers face, child labor is an additional issue associated with the chocolate market. In Ghana, 39% of children engage in economic activities with 57% of these children working in agriculture (Ghana Statistical Service 2003). Polly Hill explains that this is the result of farmers being “reluctant to ‘waste the savings’ on the employment of labor” and instead decide to outsource the work to their children (Hill 1997). The social acceptance of this practice the country is the result of desperately low thresholds for crops payments and in turn, pervasive poverty. Families desperate for additional income end up sacrificing their children’s futures to put food on the table. The problems that start at the producer level purvey through the entire society and have a fundamental impact on the development of future generations.
Additionally, there are cases of child labor which were prominently documented in the 1990’s in which children were being enslaved and forced to work against their will (Off 2008). In instances like these across Cote D’Ivoire, Mali and Burkina Faso children were forced into trafficking rings in which they were beaten when they did not behave, locked up when not working and not compensated for their work. To date children who are forced to work by someone other than a family member make up less than .5% of all child labor cases. Yet the existence of these types of circumstances at all is indicative of a system that needs to be rectified.
In the end, inequitable conditions for laborers are rooted in inexplicably low margins for cacao and ill compensation for the demanding work of farmers. Unfortunately, the system large chocolate companies use for purchasing cacao is founded on results in a large disconnect between producers and the firms themselves. Middle men buyers are an integral part of the process which makes it impressively easy for big firms like Mondelez, Ferraro and Hershey to support farms reliant on unsuitable work practices. This level of disconnect means there is no incentive for large scale companies to offer a higher price for cacao. In addition, given that the market for chocolate’s history was founded on the premise of abusing labor there should be concerted efforts to rectify past mistakes. Yet because of the
Therefore, a strategic way to start address the issue is with small batch, bean-to-bar chocolate companies that can redefine relationship between cacao producers and chocolate makers. This is where Dandelion’s approach comes into view. By building a close relationship with producers and traveling to the sites where their cacao is grown Dandelion works to change the trends against cacao laborers in many ways. The motivating factor behind this decision is a desire to ensure both quality in all elements of their product, from the cacao they source to the lives of their producers. This results in complete visibility about the entire production process starting with where both their beans and their sugar come from ending in how it makes it to the shop.
On their website the company publishes a detailed sourcing report of where every single ingredient used in their bars comes from. Each of their bars states exactly the location and the estate their beans come from. Their factory in the Mission in San Francisco opens up the entire process of making their chocolate to their customers. This feeds an interest in consumers for the terroir deriving from where the beans were harvested. Furthermore, emphasizing the fair practices of the producers they choose demonstrates that this should be taken into consideration by all those making chocolate. As the company continues to grow, they will be able to spread their mission through their consumers. When people are interested in a product they tend to become invested in the brand itself. And when the brand is tied to positive social change, the consumers get tied to the mission too. In order to correct the wrongs of the chocolate market the suppliers need to fundamentally care about the issue which means consumers need to care too. With this model driving Dandelion Chocolate’s success, it works as a mechanism for promoting the change the industry needs to see.
In the end, it is clear that a small production company like Dandelion can not overthrow multi-billion dollar companies like Hershey’s and Mars alone. They simply do not have the same resources to produce at such a large scale and the market for high quality chocolate is still relatively niche. Conversely, these firms have existed for over a century and demand is simply not growing at a fast enough rate to derail an empire. But the power in the approach of small batch chocolatiers is not in their ability to fiscally dethrone these giants. Instead, it can insight new buying trends amongst consumers that force traditional firms to change their ways. By sharing with customers the heightened experience associated with well sourced beans, small batch companies can make a dent into the sales of these conglomerates. Well intended actions detailed by involuntary legislation and fair trade stamps which can be fabricated to mean all sorts of things are not enough to make profit driven companies change their way. What can truly incite change is consumers’ pockets. And Dandelion Chocolate is one of the forces pushing them to change.
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