A brand new range of chocolate goodies is getting an old Waikato brand some new attention. Kashka Tunstall reports.
Waikato-branded boxes, bags and blocks of chocolate are hitting the shelves at The Warehouse stores all over New Zealand.
But while Waikato Valley house brand products are a new addition to The Warehouse's chocolate stock, maker the Waikato Valley Chocolates company has been providing Kiwis with their discount chocolate fix from the big Red Sheds for more than 20 years. It's just that up until now their house brand chocolate has been packaged under other names.
Waikato Valley, tucked away on Borman Rd on the north-east outskirts of Hamilton, has been churning out a range of Easter eggs, Christmas chocolates and sweets for 30 years.
Candyland owner Bill Coker was the first to own the company. He set up Waikato Valley Chocolates in the former Rototuna Creamery and Cheese Factory which is now more than 80 years old.
Coker sold the business and the building in 1987 to The Warehouse owner Stephen Tindall, and the company has been supplying the chain since that sale.
The Warehouse has since reduced its stake to 50 per cent and individual investors own the other half. They include Swiss managing director Hans Vetsch, according to Companies Office records.
Waikato Valley buys pre-made chocolate, either from a manufacturer in Auckland or Singapore, and reshapes it into its key products at its Borman Rd factory.
The company manufactures The Warehouse's annual supply of Easter eggs. Its range exceeds 100 products, such as the iconic 1kg "Pig Out" egg, with more than one million individual eggs made each year.
Easter egg-making takes a while, and the factory has already begun building its inventory for next year.
"It's certainly a key component of this company's success," Vetsch says.
The company employs about 50 workers in the factory and administration.
The factory is a five-day-a-week, 24-hour operation covered by three shifts.
Apart from the Easter range, the company makes about 70 confectionary products and the new range that's marked with the Waikato Valley logo is the first product line that the factory has put out that bears the company's name.
Vetsch says branding has never been important for the company.
“Our business is not really in brand building. Our business is in supplying The Warehouse with a competitive Easter range."
But in the planning stages of reinvigorating their house brand, formerly Tres Bon, the company decided it was time to get "Waikato" on to the packaging.
"With the house brand we tried to associate it with the region to reinforce that it's a local product and it's really been received well," Vetsch says.
He said customers have more confidence in the product when they can see the local connection.
“I suspect that people will be a little more aware of where it comes from now.”
Vetsch won't discuss the company financials, but says the global economic downturn had little effect on the balance sheet. “This industry is probably a little less prone to recessional impacts - it's almost the reverse. They say if the economy is doing badly, the chocolate sales go up,” Vetsch says.
“You haven't got the money to buy a TV but you can say ‘Oh, to hell' and go and buy a box of chocolates.”
It had a major setback 18 months ago when it lost one of its key local customers.
“I have to say, it hasn't hit us like a brick . . . but there's a bit of vulnerability, I think,” Vetsch says.
“It's certainly made it harder for us to do business, there's no question about it, but (our) prices can't go up and people still expect their wages.”
And with the rising costs of petrol affecting freight, it's getting more and more expensive to import key ingredients like cocoa which bumps up production costs.
But export markets are opening up. Australian department store Target has been stocking the company's Easter egg range for the last four years and Vetsch says he is continuing to look for the right export opportunities.
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