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Visions & Revisions
Sweet Dreams
04/01/2007

In 2005, you were acquired by Hershey—specifically by Artisan, the company’s premium division. How does this acquisition fit into your long-term strategy?
 
Scharffenberger: When we started, we weren’t trying to be a fancy, gourmet, exclusive company. We just wanted people to think of dark chocolate that was delicious when they thought of our chocolate. I remember saying to Robert, "I would love to go to the airport and see our chocolate available there someday, next to all the other traditional candy bars." That is our hope. That is what Hershey brings to the table—a larger audience.

Are you concerned that your association with such a universally rcognized brand will overwhelm your unique identity?

Scharffenberger: I don’t know. The people at Ferrari must have thought that when Fiat bought them, or Jaguar when Ford bought them. However, these big companies are smart—they know the way to succeed in the marketplace is to work a niche and to work it well. I think that’s what Hershey is doing with us.

Steinberg:
Hershey has been very clear about the fact that the method we use to make our chocolate and the way we select our ingredients are the keys to the chocolate tasting good. That is not something it is trying to change. As any company would, it wants to increase sales, but not at the expense of diminishing the quality.

Are there other American chocolate makers that are doing what you are doing in this niche market?
 
Scharffenberger: There have been a few. There is a company called Dagoba that got in on the organic side; it is now a part of Hershey as well. It was our main competitor. Now there are six little start-ups that are doing what we are doing.

Do you feel competition in the market?

Scharffenberger: No. Our only problem is finding enough cacao to meet the demand. It’s interesting: In the wine business there are 4,000 brands and 50 million consumers. In the chocolate business, there are 12 brands and 250 million consumers. It isn’t the niche it used to be.

Your factory is not your typical mass-production facility. It actually seems more like a chocolate museum.

Steinberg: We started out in an undistinguished space in South San Francisco. In 2001, we moved to a building in Berkeley built in 1906. It is a beautiful building, with high ceilings and brick walls. As you approach the factory, there is a pleasant odor of chocolate. We also have a store where we sell our products. In the production space, there are lots of pipes and machines. In one room we store the beans in burlap bags. Virtually all of these machines were constructed solely for the purpose of working with the cacao bean.

Sharffenberger:
These small machines make chocolate the way it was made 150 years ago. It is a very old-fashioned process; you can see the chocolate being transformed from an agricultural product into chocolate bars.

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