|
Post by sharkman on Jan 23, 2009 2:21:47 GMT -5
Hi there everyone! Since I grow cacao beans; i had this person ask me about starting a chocolate {factory]facility. I told him I was on the Junior Achievement scale and had no idea what it would cost equipment wise or availability of such equipment. He was thinking in the 100 to 300 lb batch range. I "ve been observing the attempts and acomplishments of you chocolate makers and was wondering where to get an approximate cost of this size of machinery. Where do people sell used equipment they have outgrown? I am a liuttle leary to take this on, but I don't want to get a real job. Any feedback would be greatly appreciated. Thanks Sharkman
|
|
josh
Novice
Posts: 56
|
Post by josh on Jan 23, 2009 14:43:05 GMT -5
Sharky,
Really it all depends on what and how you are going to deliver a product and that decision then shapes/determines the type of machinery you need vs. want. Start by looking at operations you like and figuring out how they work and what they use. You need to start building your expertise so that we can communicate more effectively. Start by looking at Theo, they have a machine tour, albeit a crappy and poorly set-up but, it will give you some insight. Maybe prepare a b-plan of sorts and determine if the costs of the machines, buying/renting make sense $ wise and how much at what price you can sell and to whom, this will determine you needs machine wise. You may need a roaster, winnower, refiner and even a conch, molding, molding line w/w/out cool, packaging and boxing. In each one of these machines you have soooo many options, like stone, longitutinal or roll refineer for instance.
IMO, you can run 300lbs of artisan on a modified large Santha weekly if you like. You can roast in an oven. You can winnow by hand or basic mechanical device. Remember, chocolate is a tough business and the machines are costly, you may want to look at lab-scale equipment to start but, the catch-22 is that you can not make a serious amount of money, if any, on lab equipment.
There are exceptions though, look at Patric's micro-batches, I hear he's doing fine (total hearsay as I don't know him). A lot of used equipment is on sale as hundreds of chocolate business have gone out of business lately too. JS started with used equipment, though 1M in used equipment isn't exactly shoe-stringing it! Think your idea over some more and get back to us with some specifics-"focus" as the sugaralc says.
Once you are done with this we can talk about sales, marketing, preference testing, media, collections, distribution, growth, capital limits, IPO's ESOP's and the other basic requirements regarding running a profitable business. Good luck and don't give up!
Jungle OUT!!!!!!!!!!!!!!!!
|
|
|
Post by sharkman on Jan 24, 2009 1:40:44 GMT -5
Thanks Josh; I appreciate the quick;thorough and positive response. I don't know if this "factory" is suppose to look good; be functional or both. My feeling is the person wants some numbers so he can make a proposal of sorts. I don't claim or care to be a professional chocolate guy. I like the growing and the processing part. I make the chocolate because I have the beans and wanted to do something with them. e bestThe quality of the beans is good and we could grow alot and not have to import. I know that a few of my friends and I could create and\or modify equipment that would chug along and make decent stuff. I think some of the pieces of the equipment could be purchased;that would do a more professional job than homemade stuff. This whole thingf would be a step up for me. I like my small coffee,chocolate and macadamia nut business;anddon't really want to get overwhelmed. I 'm keeping the possibilities open and would love to see some small chocolate factories. Maybe this person should send me on a few field trips to check everything out. I could come visit you in Guatamala! Just for fun any sugesstions for places to look for used or new equipment? If this person want s the good stuff he's got numbers he can consider. Thanks again Josh later Sharkman
|
|
|
Post by powaqa on Jun 9, 2009 16:20:31 GMT -5
you asked all the questions that i'm asking right now. did you get the answers?
the big one is of course, what kind of margins are there in a business like this? i know the answer is "it depends" but if you're setting up a bean-to-bar micro-batch business ala Patric, what's a reasonable expectation if you do it properly? thoughts from all are appreciated.
|
|
|
Post by lenny on Dec 4, 2010 22:38:16 GMT -5
Hello Powaqa. The margins from input cost excluding labor, rent etc, can be from 60-100%. Once all other costs are factored in, margin per piece can be 6-15%. So, the answer of if one can make money in such a business is a little "it depends." The chocolate business tends to favor those with large production/sales. Basically, think about it like this, with a EBITA of 10% margin, and from the point of view all profit is the owners reward (if they do not draw wage... which in my view is not good for little businesses) one would need sales of 800-1,000k to earn a good livening. However, behind that is all the capital expense and risk that things can 'go bad.'
Since about 2004 most business in all sectors are facing margin compression on declining price per sale. That is the worst possible thing that can happen in business.
|
|