Singapore Chocolatier Innovates Amid Cocoa Crisis

Singapore-based Mr. Bucket Chocolaterie is responding to soaring global cocoa prices by implementing creative business strategies rather than reducing product sizes. Founder Jerome Peñafort emphasizes that while financial exchange prices have fluctuated, the company continues to pay premium rates to farmers in Southeast Asia to support their livelihoods. To maintain profitability without compromising quality, the chocolatier has overhauled its production methods. This includes utilizing the entire cacao fruit—often discarding the husk and pulp—and automating packaging processes. These innovations have reportedly reduced overall costs by 15% to 20% compared to the previous year. Despite the challenging economic climate, the company has seen significant revenue growth and remains dedicated to elevating the reputation of Asian chocolate on the global stage.

The global spike in cocoa prices has presented a significant challenge for small businesses dependent on this core ingredient. Jerome Peñafort, 38, founder of Mr. Bucket Chocolaterie, notes that prices rarely return to previous lows once they rise. The company works directly with farmers across Southeast Asia, paying rates that are consistently higher than the market average.

Even as prices on financial exchanges have softened recently, Mr. Bucket maintains its higher payments to farmers. This decision is driven by the reality that yields have dropped due to global warming and disease. Consequently, profit margins have been squeezed, forcing the business to rethink its operational strategy.

Peñafort states that the company is not profitable every month or year. This volatility has necessitated a focus on three key areas:

• Innovation in product development
• Increased operational efficiency
• Maintaining core business values

Before founding Mr. Bucket, Peñafort worked in private equity and real estate. His entry into the chocolate industry came through family connections in manufacturing. A pivotal moment occurred during a conversation with a buyer from China, who explained that Asian chocolate would always be priced lower than European counterparts, regardless of quality, simply due to origin perception.

This interaction sparked a mission to challenge the notion that Asian chocolate is inferior. Peñafort points out the irony that cocoa grows near the equator—in Asia, Africa, and the Americas—but is processed in Europe. In 2020, during the COVID-19 pandemic, Mr. Bucket launched as an independent company in Singapore.

The company quickly found success with innovative collaborations, such as infusing salted-egg flavors from local snack brand The Golden Duck into bonbons. This product sold out rapidly during a lockdown. By late 2020, the company opened a retail outlet, followed by a café at Dempsey Hill in 2022.

Refusing to hope for a market downturn, Mr. Bucket chose to innovate across the board. The most significant change occurred in the product itself. The chocolatier began using the whole cacao fruit, including parts usually discarded like the husk and pulp. These are now utilized in café offerings, such as beverages, broth, and gelato, inspired by coffee and tea culture.

This holistic approach has reduced waste and lowered the cost of goods by approximately 15% to 20%. Additionally, the company automated parts of its packaging process, purchasing new machinery to increase batch sizes.

Despite these adjustments, Peñafort insists on never changing recipes or compromising on quality. In fact, some products have become larger, such as those featuring caramel or kaya (coconut jam) centers. While a price increase occurred last year, improved efficiency has allowed for slight reductions in some prices.

Despite a challenging economy where consumers are spending more consciously, Mr. Bucket has continued to grow. This success requires constant effort, including frequent product launches, collaborations, and seasonal offerings like the recent Christmas collection featuring butterscotch and fruitcake flavors.

Financially, the company has seen a dramatic increase in performance. First-year revenue was less than SG$1 million, but projections for the current year expect over SG$5 million (approximately $3.9 million USD).

Ultimately, the goal extends beyond selling chocolate. Jerome Peñafort aims to change the global perception of Asian chocolate, proving it can rival the world's best. The company remains committed to finding new ways to make better chocolate and build a sustainable future for Asian cocoa.