The Chocolate Life

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Hey Chocolate Life,

I am trying to get a general idea of what a store's markup is on high end chocolate bars. 20%, 50%, 100% ?

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Retail Shops generally look for "Keystone"  a wholesale price that they can double for retail.

Food Industry looks for a 40% margin.

Sounds like you're in an exciting place - Good Luck

Agreed, we don't make chocolate we make products from great chocolate and sell american artisanal bars we look for a minimum of 80% markup and often are able to do 100% markup.  Because you also have to factor in shipping/freight which drags down revenue.

To those that say you can't sell high end bars I beg to differ, it just takes a conversation.  We have bars from 5.50 to 15.00 and I am very often surprised when a high end bar goes after just a discussion about the origin, the creator, the methodology, or maybe just a simple chat on good chocolate.  You may not move a lot of them, but I feel it is always good to have a high water line that way when people see the range they gravitate towards the middle and on occasion will go for the gold per-say.  

Worst case if you don't move the bars, lose a few percent and liquidate them in a fire-sale.

If there is one thing I have learned over the past 4-5 years is never judge a book by its cover and never try and guess consumer mentality on what they are capable of doing. Yes that's a double edged sword too, hehe.

Much luck in your endeavors Dylan, let us know what you're up to.

Daniel,

I am a bean-to-bar chocolate maker, so pricing structure is be a bit different than couverture. Yet many basic principles remain the same. We both have fixed costs that can not be adjusted. Paying yourself and employees less when starting is one way, researching cheaper packaging is another, sourcing beans directly from farmers instead of middle men cut costs as well. I agree a lot with what Clay and Andy say below about making people realize what they are purchasing. You can buy a few of the best chocolate bars in the world for $20. Not many other quality foods and beverages are like this. It is the difference between getting a $7 bottle of wine vs a $70 bottle and often times it is just explaining the difference to people who don't quite understand what we do with chocolate.

Andy,

As far as what I'm up to, i am closing on a lease Monday to begin setting up a bean-to-bar factory. The company is called Manoa Chocolate Hawaii. It will be a very exciting and busy next few months as we set up shop and find our way into boutiques and supermarkets.Thanks to everyone for their shared experiences on this page.

we make our own couverture bars in our retail store so our profit margin is VERY good...  3.3oz bars sell for $2.95 four for $10.  And like Clay said about blending. I have been blending couvertures for over 18 years to get both percentages and flavors which I am looking for.  It can be a lot of fun!

Something about keystoning you might want to consider....  There is shipping as well. All retailers will deal with this differently.

wholesale * 2 = retail ...(sometimes the retailer will "eat" the shipping)

(wholesale + shipping) * 2 = retail

(wholesale * 2) + shipping = retail

plug your wholesale number in there and you will find that the retail amount changes quite a bit on a case of bars.  Understanding how your customer is going to  do their own math may help you close the deal.

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