Chuao Chocolatier’s sweet success

Michael Antonorsi didn’t find much joy in studying biomedical engineering at UC San Diego in the ‘80s.

Influenced by the ‘70s TV drama “The Six Million Dollar Man” and fascinated by the prospect of creating real-life artificial limbs, Antonorsi now admits his choice in a major was driven more by ego than passion.

His decision to also get an MBA and go into high-tech in his native Venezuela was mainly to please his parents, he said.

“All I wanted to do was go to culinary school,” Antonorsi, the co-founder of Chuao Chocolatier, recounted recently. So, in his mid-30s, he packed up his wife and young daughters and moved to Paris, where he would eventually train in pastry and chocolate at the noted École LeNôtre.

And like so many others who seek satisfaction in a chocolate-covered sea salt caramel, Antonorsi found what he had been yearning for.

“I loved every minute of it in Paris. It was the first time work didn’t seem like work for me.”

Today, drive by the gleaming, new 28,000-square-foot Chuao headquarters and expanded production facility in Carlsbad, and the first thing you’ll notice in front are three giant carved-wood letters: JOY.

Chuao (pronounced chew-wow) is spreading an increasing amount of that around the country these days. Already widely available in high-end hotels in Las Vegas, the outdoor gear superstore REI and at Whole Foods, Target and Starbucks, the company recently inked a deal that puts the premium chocolate in 7,800 of 8,000 CVS stores in the U.S.

The distribution agreement gives Chuao - founded in Encinitas in 2002 - a level of mainstream exposure along the lines of San Francisco’s gourmet brand Ghirardelli Chocolate, not to mention industry giant Hershey’s.

Chuao’s profile in San Diego is also expected to rise in the coming months as company officials build out the glamorous retail portion of the Carlsbad facility, open it up for events, introduce public tours of the chocolate-making production area and hold tastings at a bar-height, marble-slabbed chef’s table.

The company’s local and national brand expansion parallels the growth in America’s more sophisticated sweet tooth for chocolate.

According to the National Confectioners Association, a trade organization, retail sales for candy in the U.S. were $34.5 billion, with chocolate making up about $21.1 billion of it, or more than 60 percent. Overall chocolate sales increased 2.9 percent in 2014, but premium chocolate sales went up an estimated 11 percent.

In a July report, ConfectionaryNews.com quoted industry analyst Jack Skelley saying more U.S. candy makers are moving to “premiumize” their chocolate - producing more dark chocolate products with higher cacao percentages - as Americans look to healthier snacks.

“Consumers’ tastes have changed,” Antonorsi said. “People are more aware of the ingredients, they’re more ingredient savvy.” With that comes more adventurous approach to flavors, he said, adding that bars with mix-ins - from potato chips to honeycomb, peppermint sticks to bacon - are the most popular.

CVS will carry six Chuao bars in six flavors, including Firecracker, Caramel Apple Crush, Potato Chip and the No. 1-selling Baconluxious Chocolate. The bars’ suggested retail price is $4.99. (By comparison, a standard-sized Hershey bar sells for 89 cents on target.com.)

The customer comfortable with Chuao’s price point is looking for high-quality ingredients and an experience, Antonorsi said, not just a sugary treat. Losing sight of that could imperil his business, he said.

“The worst decisions we’ve made have always been triggered by the wrong intentions, like changing a product for an immediate benefit,” he said. “That’s not in line with our core values. You’ve got to stay the course, don’t become a shoe store because shoes are selling more than chocolate. Don’t start following the money. ... Don’t say, ‘Hey, let’s do a cheaper product for a different market, like China.’”

Chuao was alone in the San Diego premium chocolate niche when it opened its first boutique and cafe at Encinitas’ Lumberyard specializing in such exotic flavors - for that time anyway - as Spicy Maya, with cinnamon, pasilla chile and cayenne pepper. The company maintains the Encinitas location, as well as a shop at the Del Mar Highlands shopping center.

Initially, there were just a handful of employees; now there are 70 who work in two shifts producing 120 kinds of bars, truffles, bonbons and drinking chocolate. Exact figures for the company’s annual sales or production were not disclosed.

When the public tours of the plant begin, most likely in early 2017, they’ll be taken through the process that begins with melting, then mixing, molding, cooling, packaging and shipping.

The factory tours, akin to what producers from Hershey’s to Ghirardelli and Seattle’s Theo Chocolate already conduct, could help boost brand affinity by making Chuao a destination, not just a product.

The loyalty customers have with a local chocolatier helps sustain the business, said Isabella Valencia, of Dallmann Fine Chocolates, which is located at The Headquarters in downtown San Diego.

“People are looking for a connection here, not just a brand, like See’s and Godiva. It brings value that there’s a (person) behind it,” she said.

In the county, the number of premium chocolate houses has increased and includes Eclipse Chocolate, Andrea’s Truffles, David Bacco Chocolatier and Sweet Petite Confections.

Antonorsi and Valencia said the artisan chocolate business grew during the recession and that sales have stayed strong because their product is an affordable indulgence.

“Chocolate is still a luxury product, people love it, but they don’t need it,” Valencia said. “Maybe you can’t shop for a diamond ring, but you can still make someone feel special with chocolate.”

Source: DiscoverSD