Wnder: the downsides of working with big retailers

Accepting a deal with a major department store – the goal for most founders – turned out to be the end of Luke Pearson's chocolate business. Here's what he learned from the experience.
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Luke Pearson, founder of chocolate brand Wnder, is winding down his ethically sourced cocoa business. While there have been lots of challenges – dwindling margins, expensive import charges, long production times – the final nail in the coffin was something that most people would think of as being good for business: a listing with major UK department store Selfridges. Here's why getting a big retail listing might not be right for every business.

1. Loss of control.

You'll probably be forced to grow to accommodate the increase in orders. ‘Normally, an average order would be 30 to 60 bars from a wholesaler. [Selfridges] ordered 150 bars and 220 jars of our drinking chocolates,’ says Luke. Despite calling in favors from friends and family to pull it off, running a production run of that scale was stressful and unsustainable. The solution – hiring someone to take the reins on production – wasn't something Luke was ready to do.

2. Too much, too soon.

‘I admire Selfridges greatly, but it was clear we were too small for them,’ says Luke. According to the chocolatier, the past few months were pretty intense. As the business grew, he had less time to focus on production, marketing or admin. As a result, everything took a hit and he felt unable to maintain the high standards that he'd set for the business. Plus, he wasn't at a point where he wanted to invest any more money in the business or bring on new employees.

3. More paperwork.

‘As a small producer, you can't just knock on [a customer's] door and hand over some bars of chocolate,’ says Luke, ‘There [are] paperwork and distribution companies that you have to deal with.’ These accredited distribution companies, who he'd have to work with, tend to charge a hefty fee for their trouble.

4. Opportunity cost.

Luke also runs Pear & Sons, a creative consultancy in the food and drink space. Taking on a major retailer meant he could no longer focus on his enjoyable (and better-paid) consultancy work. Plus, the physical demands of his chocolate passion project were taking their toll; during a six-week production schedule to fulfill big orders, days in the factory easily stretched from 6am to 10pm. Once he's formally wound down Wnder, Luke will be refocusing on his consultancy work.

A version of this article was published in the Courier Weekly newsletter. For more useful stories, tips, tricks and simply good advice, sign up here.

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