This as-told-to essay is based on a conversation with Jerome Peñafort, 38, the founder of Mr. Bucket Chocolaterie in Singapore. The following has been edited for length and clarity
Once prices go up, they rarely come back down — and that’s definitely true for cocoa.
For a small business where the main material is cocoa, it’s a real issue when your core ingredient keeps getting more expensive.
We work directly with farmers across Southeast Asia, so even before prices started climbing around mid-2023, we were already paying about two to three times the market rate — and now we’re paying even more.
We’re still paying the same higher price to our farmers, even though cocoa prices on financial exchanges have softened in recent months, because yields have dropped due to global warming and disease.
The higher cocoa prices have cut into profit margins. We’re not profitable every month or year.
That has forced us to think differently about how we work: how we innovate, how we become more efficient, and how we stay true to our purpose.
Rethinking Asian chocolate
Before founding Mr. Bucket, I worked in private equity and real estate, where I learned most of my business concepts.
About eight years ago, my dad got involved in my uncle’s chocolate manufacturing company. I joined the team around 2019 and began learning about chocolate and the entire supply chain.
During that time, I had a conversation with a buyer from China that really sparked the idea of Mr. Bucket. We were selling entry-level supermarket chocolate when he told me that even if our chocolate was similar in quality to European brands, it would always be priced lower — simply because it wasn’t made in Europe.
That really made me think: Why is Asian chocolate seen as inferior to European chocolate? Cocoa grows near the equator — in Asia, Africa, Central and South America — but not in Europe. It’s just processed there.
In 2020, during the COVID-19 pandemic, we launched Mr Bucket as an independent company and started making chocolate in Singapore when operations in Malaysia were disrupted. That’s when I realized that chocolate made from Asian beans is delicious.
Our first collaboration was with local snack brand The Golden Duck, when we infused their salted-egg flavor into our bonbons — a chocolate shell with layered fillings.
Days after we launched the campaign, Singapore announced a lockdown, and because everyone was stuck at home, the response was amazing. We sold out hundreds of boxes of bonbons in two weeks.
In late 2020, Mr. Bucket launched a retail outlet in a local residential neighborhood, and in 2022, we opened a café at Dempsey Hill, a lifestyle destination in Singapore.
Innovation not shrinkflation
We can’t plan our business around the hope that cocoa prices will come down. If they do, it’s a bonus.
High cocoa prices have forced us to be more productive and innovative in every part of the business.
The biggest change was in the product itself.
We started using the whole cacao fruit — not just the nibs that are usually ground with cocoa butter and sugar to make chocolate. We also use the husk and the pulp, which have a lot of flavor — but which are usually discarded — in our café offerings.
We drew inspiration from coffee and tea, using cacao to make beverages, broth, and even gelato. That helped us diversify and reduce waste.
Because of these changes, our overall cost of goods has gone down by about 15% to 20% compared with last year, even though raw cocoa prices are higher.
We also looked at packaging.
Instead of using a lot of labor to do things by hand, we started automating certain parts. We bought new machinery and increased batch sizes.
Through it all, we’ve never changed our recipes, and we won’t. We will not compromise on quality.
We’re not reducing sizes either. In fact, some of our products are bigger now, like chocolates with caramel or kaya — a local coconut jam — centers.
We did a price increase last year. But as we became more efficient, we were able to bring some prices back down a little.
Know the ‘why’ of what you do
In this economy, consumers are definitely more conscious of their spending, but we’ve still seen growth.
To achieve that, we’ve had to work a lot harder: put out more products, do more collaborations, and create new products constantly.
For Christmas, we’ve launched a festive collection with new flavors like butterscotch and fruitcake.
Our first-year revenue was less than $1 million Singapore dollars. We expect over SG$5 million, or $3.9 million, this year.
We’re not just making chocolate.
We want to change the perception of Asian chocolate to show that it can be as good as any in the world.
That’s what keeps us going: not cutting corners, but finding new ways to make better chocolate and to build a future for Asian cocoa.
Do you run a small business in Asia affected by rising prices? Contact Huileng Tan at [email protected].
