Divine Chocolate is that very rare thing in business – a company which successfully balances its commercial success with making a meaningful social impact.
Divine was formed in 1998 by Twin Trading, the company which set up Cafédirect, after a cocoa farming co-operative in Ghana, Kuapa Kokoo, decided to launch a Fairtrade chocolate brand to give them a share of the valuable chocolate market and a more sustainable income. On returning to the UK, Twin Trading secured investment from the Body Shop, with Gordon Roddick sitting on the company board for ten years. Charities Christian Aid and Comic Relief were also key at the initial stages, as was the Department for International Development, which enabled the fledgling company to secure funding through a loan guarantee scheme.
Sophi Tranchell came on board as Managing Director in 1999 from a background in the film industry: “I’m the person who turned a very good idea into a reality,” she says, laughing. “When I arrived we had five staff. Now there are 19 and I am able to be a lot more strategic in growing the company.”
How it works
She explains how the trading arrangement works: “Divine is a company limited by shares and Kuapa Kokoo has two representatives on the board – the elected President and the Managing Director of its trading company. We meet three times a year in the UK and once in Ghana.
“We work as a conventional marketing and distribution company in the UK, with the chocolate manufactured via sub-contracting, with the farmers supplying cocoa which is delivered to the chocolate factory in a sustainable supply chain. We then order it on the basis of what is required. The farmers then get a guaranteed Fairtrade price and a social premium and we also invest 2% of our turnover in what we call Produce and Support and Development, spent on a programme mutually agreed between the farmers, Divine and Twin Trading. For instance, the co-operative has been very active in running gender programmes, supported by us and it has also run a pilot radio programme to encourage better communication with members.”
A successful relationship
The Kuapa Kokoo co-operative is the most successful in Africa, with 65,000 members in 1,400 villages across rural Ghana. Last year it produced 5% of all the cocoa bought in Ghana. “We know the farmers personally and it is a very close relationship,” Sophi adds. “Ghana is a very welcoming country with English as the official language, and it is on the same time-zone as us, which makes things much easier.”
With current turnover at £7.6 million in the UK, Divine is already selling steadily into Scandinavia, Holland and South Korea, and now has ambitious plans to expand its presence in the US, generating £4.5 million from an office of nine people in Washington DC. Establishing the brand in this notoriously daunting market has not been simple, but the hard work is beginning to bear fruit. “We hope to break even this year,” says Sophi. “The intention to set up in America with American shareholders was always there, and we incorporated in early 2007. The company has similar shareholdings to the UK, but shares are also held by Lutheran World Relief, a US NGO, and SERRV, a US Fairtrade organisation.
Building a US brand
“It has been interesting growing our brand in the US,” Sophi explains. “Americans like farmers, whereas in the UK when we started, farming had a negative connotation. Our story also resonates with the American dream – farmers owning a company as a way to get out of poverty.”
Up against multinational brands with massive budgets and ‘household’ brand names, the Divine strategy has been to start in a number of regional supermarket chains and speciality stores – with the large chain Wholefoods now stocking the chocolate bars nationally. “Wholefoods has really sold our story in-store and in their own marketing, which has been fabulous for us.
“We have a fantastic story to tell which gives us coverage money couldn’t buy,” Sophi says. “It also means we have an ability to recruit and retain staff who are completely committed to their job, they know the difference they are making – everyone here is motivated. The farmers have a reputation of their own which they can use to their advantage, they understand their role in the industry, have their own income streams which are feeding into the local communities funding schools, clean water projects, mobile health clinics and more. They are empowered.”
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