OCHO Limited

WHO ARE WE?

ESTABLISHMENT AND RELOCATION

OCHO is a chocolate manufacturing company in Dunedin which was formed in response to the closure of the Cadbury factory here in 2019. We are a bean to bar chocolate manufacturer. All of our cacao is sourced from farmers in the Pacific. We make sure that the money we pay for our beans makes the local economies as strong as we can make them. At home we were the first accredited Living Wage Aotearoa company in Dunedin and are committed to making OCHO a business that is good for our community, the environment and our customers. Our chocolate is true to the essence of craft chocolate being bean to bar and with just two ingredients, beans and sugar.

OUR PEOPLE

 

 

 

 

 

 

 

 

Jim O'Malley: Chair of the Board, Managing Director

 Jim has been the Chair of the Board since OCHO was formed in 2017.

 

 

 

 

 

 

Jason Lindsey: Board Member

Jason came to the board of OCHO with significant experience in large companies and start ups.

 

 

 

 

 

 

Scott Muir: Board Member

Scott has a long career in the music industry and the arts sector at both the operational and the governance level. He brings to the OCHO board governance and small business strategic direction skills.

OCHO has a board that has wide experience in small business startup as well as large corporations. They bring a wide range of business experience to OCHO and are committed to the social and environmental goals of OCHO. The production team at OCHO has been making chocolate since 2014 from before the establishment of the current company, when the old OCHO was a small local producer. The team has taken their experience of artisanal chocolate making and applied it to factory scale craft chocolate manufacturing resulting in the production volumes which are capable of supporting a national footprint without sacrificing the quality associated with small volume craft chocolate manufacturing.

 

WHAT WE HAVE ACHIEVED TO DATE

ESTABLISHMENT AND RELOCATION

After setting up in Vogel Street we moved into our new fit for purpose factory in January of 2019 and went into full production in the middle of that year.

PRODUCTION CAPACITY IMPROVEMENT

We are capable of producing 850kg of bulk chocolate every week and can temper 350kg of finished bars a week. Approximately 100kg of the bulk chocolate capacity is used in the manufacture of drinking chocolate and cocoa butter. This leaves an unused capacity of 400kg a week.

NEW PRODUCTS & PRODUCT EXTENSION

• Refocusing our in-house tours for the New Zealand visitors
• Award - winning limited release Hot Cross Buns
• Drinking chocolate

PEOPLE

We have a highly skilled, diverse and committed group of individuals who share a sense of ownership in OHCO’s success.

WHAT'S NEXT?

PRODUCTION

The investment in new packaging and additional packing equipment will achieve improved efficiencies in the manufacturing process by replacing highly repetitive and labour intensive tasks with automation. This will reduce labour contributions to the cost of goods and also improve the workplace environment for the production team. In fact, both our accountants and our production team are very excited about getting this new equipment!

The increase in tempering equipment will increase production capacity for finished chocolate from 300kg/wk to 600 kg/wk. It is part of a strategic investment plan where chocolate tempering capacity is brought into alignment with the existing bulk chocolate manufacturing maximum capacity of 1 tonne/wk in stepwise investments that match near term market growth goals. It is anticipated that this increased production capacity should be sufficient to support $1.6 million sales revenue which we believe, if achieved, to be sufficient to fund further equipment purchases thereafter.

FINANCIAL FORECAST

RISKS

SUPPLY CHAIN: RAW MATERIAL SUPPLY

OCHO imports its beans from the South Pacific. Two potential risks exist for bean supply. These are destruction of crops due to extreme weather events, such as hurricanes, and disruption of the supply chain and shipping issues.

Mitigation

• By sourcing throughout the Pacific, we can respond to production losses by sourcing from other regions while the affected area recovers
• We will be bulk-buying beans and retaining six months’ supply on hand

WORKFORCE CAPABILITY: LOSS OF KEY STAFF OR TEAM CULTURE

As a craft manufacturer we rely heavily upon the capacity and capability of our staff.

Mitigation

• We have a training programme in place to ensure more than one person can perform every key activity
• Every task is described in our staff training and procedure manuals
• We remunerate our employees above industry standards and pay attention to the work life balance of our employees.

QUALITY ASSURANCE: FOOD, HEALTH AND SAFETY

As a food manufacturer, food safety is always front of mind.

Mitigation

• Established food safety, food allergen and product recall plans in place and tested regularly.
• Milk allergens are dealt with using separate production equipment.
• By its nature, chocolate is a simple food product which does not support the type of microbial life that is associated with food spoilage

FINANCIAL STABILITY

Ensuring financial liquidity is a prerequisite for any ongoing business, along with sound Board Governance and associated planning.

Mitigation

• Capital raise by PledgeMe to support liquidity, strategic market development and cost reduction
• Maintaining positive relationship with our shareholders and banking partner
• Having in place sound Board oversight and internal controls

EXTERNAL MARKET IMPACTS

As company previously reliant upon a narrow sales base the impact of Covid 19 was significant.

Mitigation

• Diversification of our sales channels within our strategy
• New product developments
• Strengthening our sales force in key metro areas

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