From its location in rural Ghana, fairafric creates some of the finest organic chocolates in the world. Its 10,000 an hour factory churns out chocolate bars that are enjoyed not only in Ghana but also in Germany, France, Austria, Belgium, and even Switzerland.
Not many food companies can boast of starting operations 6-months after they began construction of their factory premises or achieving the highly stringent FSSC 22000 food safety management system within a year of their operation.
Even fewer can say they have managed to export over 2 million bars of chocolate to Europe within a year of their operation.
But Ghana-based chocolate manufacturing startup fairafric can.
The company is also the only one, or among the few in Africa, that had a country’s main airport temporarily opened for a small team of expatriates to jet in and help with setting up its production facility, at a time when international travel was closed to contain the Covid-19 pandemic – on the orders of the president of the country, none other than President Nana Akufo-Addo.
From its humble location in Suhum, a rural community within the Eastern corridor of Ghana, fairafric is creating waves in the world chocolate industry. Its chocolates are today enjoyed in Germany, France, Austria, and Belgium. Even Switzerland with its positioning as the home of high-quality chocolate is also developing a liking for fairafric’s chocolate.
An idea that turned into bars of chocolate
Although the company’s operations are just over one year old, the idea isn’t.
Hendrik Reimers, fairafric’s founder and CEO, had always toyed with the idea of adding value to Africa’s agricultural produce, instead of just shipping it to Europe. He tried coffee in the East of Africa, but it didn’t work.
Not a man to be cowed by failure, Hendrik turned west and in cocoa he found success. In 2016, after a successful crowdfunding round, Hendrik succeeded in making his first batch of chocolate in Ghana. Hendrik was to later to meet with Yayra Glover, a Switzerland-trained Ghanian lawyer who turned to organic cocoa as a way of providing better livelihoods for Ghanaian farmers. Their meeting created a partnership that led to the production of Ghana’s first organic chocolate products.
The idea for organic chocolate was solid, and the market was there in Europe, but fairafric had no production capabilities. Getting hands on financing was also not easy. Not many financial institutions were willing to lend a company that had no track record of operations. Contract manufacturing seemed a viable trade off and the fairafric brand was ready to launch.
“Anyone who knows fairafric knows about our “luxury problem.” Due to the high demand and our current, comparatively small production facility, individual varieties are often sold out. Sometimes our warehouse in Germany has been swept completely empty.” Capacity had become a new problem that fairafric had to find a solution for. “We would love to not only meet the demand that reaches us, but also create more. Because every bar means additional income in Ghana and additional jobs in the processing of the raw material cocoa.”
Given manufacturing was contracted, there was only so much the company could do, and regrettably it’s production partner was unwilling to make additional investment. Taking charge of the entire production process by setting up its own facility became the only solution if fairafric was to grow to its fullest potential.
Financing makes manufacturing a reality
Hendrik, having previously crowdsourced his financing, pretty much knew what to do to get support for fairafric’s expansion – sell his story well to potential investors.
“This is all we have been doing, to tell people of all our plans, the beautiful things that we can do with their money, of all the lives that can be transformed with their money, and so far, this is what has been helping us to do the things that we do,” says Michael Marmon-Halm, the Managing Director of Fairafric Ghana Limited.
In 2019, plans of raising funds had started taking shape and in April, over €1.2 million (US$1.4 million) had been raised in a crowdfunding round led by German chocolatier Ludwig Weinrich GmbH & Co KG. Another breakthrough came in January 2020 when German development finance institution DEG granted US$2.2 million to fairafric to set up its own chocolate processing factory.
With fundings from investors in place, the chocolate maker was now ready to start its own greenfield project, only that the project commencement coincided with targeted lockdowns in Ghana aimed at curtailing the spread of the corona virus.
A Presidential intervention
The pandemic brought new challenges to the project’s progress, explains Michael. Lockdowns were instituted in Accra and most of the initial work had to be completed at home by his team.
Luckily for Fairafric, Suhum, being just outside Accra was exempted from the targeted lockdowns, so construction activities could go on, but that too was met with challenges when the Ghanaian airspace was closed and expatriates who had been contracted for installation of various chocolate manufacturing equipment could not jet into the country.
“We could not readjust the schedules as suppliers also had engagements elsewhere. To circumvent this red tape, I had to write to the presidency and even went to meet the president to ask him to intervene and help fairafric continue with its plans as scheduled,” Michael explains.
Out of that conversation, fairafric was given permission to have chartered flights to bring in expats, to the surprise of the youthful fairfric MD. “A whole international airport was opened for 5 people!” To Michael, his request’s approval showed that indeed the government of Ghana understands the value that the fairafric project was bringing into the nation and was willing to give the upcoming startup all the support it could, even if that support meant adjusting the laws that it had put in place.
“So, we brought in the expats and within five and a half months were had gone from installation to commercial production!”
Sustainability right from the start
At a time when consumers are increasingly environmentally conscious, you can never go wrong with sustainability.
Michael explains that Fairafric has taken pride in being a carbon neutral company right from the start of its operations in 2018. When it did not have control of most of its production processes, the company partnered with the natureoffice to compensate for negative footprints arising from among other things, the operating resources, the mobility of chocolate, business mobility, and the use of materials and packing materials.
As of 2019, the company had offset a total of 61,272 tons of CO2 emissions in their partnership with natureoffice. Part of the carbon offsetting projects that fairafric has participated in includes Project Togo, which aims to reforest natural forests in Togo and Toyola clean cookstoves project, which offers Ghanaian households with Toyola Coalpots, stoves that can reduce fuel consumption by around 30%.
Being a business that appreciates sustainability, fairafric was also careful to continue the environment conscious trend in the establishment of its chocolate facility. Michael reveals that fairafric is the only factory in Ghana that uses renewable energy. “Our roofs are totally covered with solar panels generating about 275kVA of electricity and this accounts for 88% of our energy needs,” he says. The company also has a sustainable way of managing its waste with 100% of decomposable waste being directed to a waste processing plant where it’s converted to organic manure for use by farmers.
“As an environmental conscious company, we have completely stopped the use of aluminium foil as the primary packaging material. Our chocolates are wrapped in biodegradable material called natureflex made from wood pulp and our secondary packaging is also paper, which is also biodegradable.”
At the repeated request of customers to buy fairafric chocolate without packaging, the company has also decided to join the zero-waste movement and to supply zero waste stores. fairafric now packages bulk quantities of chocolates, usually 5 kgs, and transports it to designated zero-waste stores where it is then dispensed to customers, saving them from packaging material that normally comes with the conventional chocolate bar.
Sourcing organic ingredients
“Our storyline tries to harness the strength of Africa as a continent,” says Michael. As an organic chocolate manufacturer, getting the right quality of organic ingredients has however not been a mean feat.
“It would have been our wish to be able to get all these ingredients from the continent, if not in Ghana but from Africa,” he adds. Organic cocoa beans are however not difficult to come by, in fact they are in plenty in Ghana. Fairafric’s organic cocoa beans can be traced to some 5,000 organic farmers who are enrolled in Yayra Glover’s sustainable cocoa farming program.
Chocolate is however not made from cocoa beans alone, other ingredients such as milk, sugar, and nuts must be incorporated to achieve the desired quality of chocolate. Sourcing these other raw materials, however, is a significant challenge for fairafric. Michael notes that the lack of awareness on organic farming in Africa has contributed to little investment in the sector. Poor knowledge also misleads many farmers into thinking that any produce that is grown without chemicals qualifies as organic.
“For a product to be truly organic there should be a system that monitors the entire farming process, which should also be supported by a third-party assurance and certification. This is something that is missing on the continent,” he observes.
The search of truly organic ingredients landed fairafric in Mozambique where it now sources its sugar from. “Unfortunately, we are still importing milk powder from Germany, which is kind of sad because this is an industry that should be local,” adds Michael
Above and beyond in community impact
Fairafric would have been located at a prime location in Ghana’s capital Accra, where it would have had easy access to market, Michael observes.
As a social impact company, fairafric however chose a remote village in Suhum as its location. Suhum is a town known for its significant production in Ghana. Despite its contribution to Ghana’s cocoa revenues, the town has enjoyed little development, reveals Michael. Fairafric wanted to change this narrative.
For the short period of time that fairafric has been in Suhum, notable developments have happened, putting the little town on the map of Ghana. “Ever since we set up our factory here, Suhum has started to gain some recognition. More people are coming to the community. Our 10,000 bars an hour chocolate factory has already created direct 80 jobs and over 1,500 others indirectly. We are bringing change. Some cocoa farmers only produce the crop and have no idea what it is used for, but today they can see for themselves that all their hard work pays off.”
A study conducted by Tamara Kaschek a master’s student at the University of Bochum revealed the true extent of fairafric’s social impact on communities. In her study, Tamara found out that as far as the non-monetary dimensions of poverty are concerned, the fairafric organic farming initiative implemented with partner Yayra makes a significant contribution to empowering the farmers.
“It leads to an increase in general life satisfaction and an improvement in the general standard of living of the farmers, especially with regard to sanitation and housing,” the study revealed. The study further noted that the program makes a significant contribution to reducing illiteracy among farmers children and increasing the farmers’ awareness that education is affordable. Going into the study, Tamara says that she had expected to see that the expenses for certified farm workers would be higher. “Since there are fewer pesticides used there, there are more weeds and therefore you actually need more farm workers, but that was not the case – the farmers who work conventionally had just as much expenditure on farm workers, which surprised me.”
Few companies can boast of the transformational impact that fairafric has had on farmers. But the company still wants to give even more to farmers who are a critical part of their operations. “That is why we spoke to tax and legal experts to find a way to let cocoa farmers participate in the success of fairafric.”
Those deliberations proposed a foundation that will acquire and hold shares on behalf of the farmers with future dividends being distributed to the farmers by the foundation, broken down according to the amount of beans that they have harvested for fairafric. “The step of giving our cocoa farmers shares in fairafric will motivate us as a team in our daily activities and encourage us to further spread the history of Made in Africa chocolate.”
Leaving nothing to chance
Having made great strides so far, the company believes it still has a lot to do to create more impact in Ghana’s cocoa value chain.
Currently, the company outsources the initial steps of chocolate production to a third-party company, that means beans first arrive in another manufacturer where they are processed into liquer, butter, and powder before being shipped to fairafric for final processing.
As the organic chocolate market rapidly expands and consumer tastes and preferences continue to change, Michael believes that there is a need for fairafric to be in full control of its entire processing line, by installing a primary processing plant, with plans afoot to invest in this new facility in a few years. “It will create more jobs and put us at a better position in terms of control and giving us an opportunity to tweak our recipe to respond to changing consumer demand.”
As a social impact project fairafric is also looking at ways to continue transforming the lives of farmers. “We are looking at it in two areas: biodiversity and agroforestry. We want to create a system that creates an alternative livelihood for these farmers so that they can have regular income all year round while also protecting and preserving the environment.”
Achieving all these plans would require significant financial investment of which Michael tells us that the company is open to discuss with investors about how they can contribute to the beautiful story of transforming African lives, one bar at a time.
This feature appeared in the Sep/Oct 2021 issue of Food Business Africa. You can read this and the entire magazine HERE