Wednesday, January 28, 2009

Hershey’s announces closing of Joseph Schmidt & Scharffen Berger Bay Area Facilities

At the Fancy Food Show in San Francisco, I missed the opportunity to watch Joseph Schmidt make his famous chocolate bowls - though I did get to see the fresh works and talk with him briefly. Though some of the high end items like the bowl from Joseph Schmidt are undoubtedly crafted items, the current mass manufacture of the truffles doesn’t really keep with the artisan vibe.

Are they still artisan confections when they’re consolidated into one manufacturing plant in Illinois? Were they even still artisan when Hershey’s bought them in 2005?

A little history: In 2005 Hershey’s started a spinoff company and seemed to tap into a new trend in the United States: small batch, carefully crafted confections. They created an autonomous company called Artisan Confections Company and into it went Joseph Schmidt and Scharffen Berger and later in early 2006 Dagoba.

Milton S. Hershey started as what could be described as an artisan confectioner. He made hand-stirred caramels, eventually made his fortune with a company called the Lancaster Caramel Company. Of course this was all at the same time that the industrial revolution and the assembly line was transforming everything from stockings to cars and then chocolate with Hershey’s five cent milk chocolate bar.

But mass production doesn’t mean bad. Or at least it doesn’t have to mean it.

What this meant initially was greater distribution and monetary muscle for these tiny chocolate companies. (Scharffen Berger & Dagoba are chocolate factories, Joseph Schmidt is a chocolatier.) And it’s done quite a bit for the public. Access to these varieties of products has done munch to educate consumers about the nature of chocolate, how flexible it is, how specific beans grown in a particular valley can taste vastly different to mixed beans. Dagoba showed us that organic and ethical doesn’t have to taste like the heaps of faint praise given to children who make macaroni art.

But most chocolate lovers have been waiting for the other shoe to drop. After all, this is Hershey’s - a company that isn’t known for the quality of its products these days or the respectful way that it treats its customers.

The announcement yesterday sounded like this:

During the fourth quarter of 2008, the scope of the Global Supply Chain Transformation program increased modestly to include the closure of two subscale manufacturing facilities of Artisan Confections Company, a wholly owned subsidiary, and consolidation of the associated production into existing U.S. facilities, along with rationalization of other select items. These initiatives, which will be completed in 2009, increase the expected total cost and savings of the Global Supply Chain Transformation program by approximately $25 million and $5 million, respectively. Approximately $15 million of the increased costs are non-cash charges. (source)

The names Scharffen Berger and Joseph Schmidt appeared nowhere in the official press release. In fact, I read over this fourth quarter report, even twittered a smidge, without even realizing what that meant. Subscale? Rationalization? It wasn’t until later that evening that the SFGate posted the news and Cammy from Munchcast popped me a note.

There were assurances from Hershey in 2005 that the company would retain its staff and location (though it did expand, I don’t think anyone can be upset by that, as they did say that they wanted to grow the brand). The sad truth is that this is merely a formality. Scharffen Berger chocolate has, for the most part, been made in Illinois for a couple of years. The Berkeley factory is a bit of theatre. Sure, it’s a working factory, but it may as well be Chocolate World for the well-heeled.

But this leaves a hole, a new opportunity for the actual hand crafted chocolate makers out there. And Scharffen Berger should look sharp, there are far more than back in 2005 when it got its infusion of cash. Askinosie, Amano, DeVries, Taza, Theo, Tcho, Patric, Mast Brothers, Original Hawaiian Chocolate Factory, Rogue Chocolatier and Jacque Torres ... that’s just bean to bar folks in the United States.

If you’d like to see Scharffen Berger & Joseph Schmidt’s roots, I’d recommend a trip soon.

Joseph Schmidt (previous review)
3489 16th St
San Francisco, CA 94114

Scharffen Berger Chocolate Maker (factory tour)
914 Heinz Avenue
Berkeley, CA 94710
(510) 981-4050

UPDATE 1/29/2009: It appears that Scharffen Berger has already stopped the free tours, even though word is that the factory will continue production at least until April.

UPDATE 2/10/2009: Joseph Schmidt is closing its doors for good, there is no shift of production. They will continue and fill orders through the Easter holiday. Though 150 other Bay Area folks are out of a job (including the Scharffen Berger folks), Joseph Schmidt himself will continue to be employed by Hershey’s. I expect that he will continue his appearances at trade shows and events, and perhaps consult on recipes.

Related Candies

  1. Hershey’s Website Inaccuracies
  2. Askinosie Chocolate
  3. Tcho: Beta Batch No. C Ghana 0.7 AH
  4. Amano Single Origin Bars: Madagascar & Ocumare
  5. Theo 3400 Phinney Bars
  6. What Made Hershey’s Want to Change Chocolate?
  7. Big Candy Buyouts - Hershey & Jelly Belly
  8. 2006 Independent Food Awards

POSTED BY Cybele AT 1:02 pm Tracker Pixel for Entry     CandyFeatured NewsNews

  1. So much for chocolate being recession-proof.

    Comment by Rosa on 1/28/09 at 1:42 pm #
  2. Sera's avatar

    Sadness. :(

    Comment by Sera on 1/28/09 at 2:38 pm #
  3. Sadly I saw on the Fog City News list that factory tours at Scharffen Berger were suspended immediately because of fears that tour guests would help themselves to mementos.  They will be missed!

    Comment by D on 1/28/09 at 4:53 pm #
  4. Does anyone know a good online shop that sells quality candy corn worldwide? I really want to buy some but i’m in Australia…

    Comment by Desperately Seeking Candy Corn on 1/29/09 at 2:15 am #
  5. Thank you for the informative post.  This is truly sad news. 

    I guess I missed my chance to tour the factory.  *pout*

    Comment by Paula Maack on 1/29/09 at 8:52 am #
  6. Here in Ontario, our dollar store( Dollarama) is carrying 85G bars of the sharfenberger for 1.00!!  I was stunned!!  I bought 14 bars the other day.  I like the 41% for eating.  I havent tried the other percenteges yet, but I think they’ll be fine for baking!!

    Comment by Randi on 2/02/09 at 10:56 am #
  7. I visited my local chocolate bar in Sonoma County this weekend, and the person working the counter told me that she called Joseph Schmidt directly following the announcement and was told that they are being shut down.  Not just their local digs, but the whole line is being discontinued (not Scharffen Berger, though).  Does anyone know if this is, indeed, true?

    Comment by Robin on 2/02/09 at 11:36 am #
  8. We just got a letter from Artisan that they have decided to stop producing Joseph Schmidt anywhere.  They are shutting the brand down for good.  It was on their stationary, so it’s confirmed.

    Comment by tipster on 2/09/09 at 12:24 pm #
  9. I just found your blog last week and am reading my way backwards.  I am just beside myself to hear that Joseph Schmidt is closing.  I never had the pleasure to try Scharffen, but I loved JS and am so sad to know it will not be there for my next visit to the Bay Area.

    Comment by Amber V on 3/23/09 at 5:15 am #
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