Phil Hemming, Sales Manager with Ross Chocolates tells us about how the company was founded by a love of chocolate and how a diabetes diagnosis for Bob Ross put that in jeopardy. Hemmings also explains how Stefano Urbani revitalized the company in 2016 and created a company that has become an innovator in the industry and continues to pivot in the better for you market with a mission that everyone should be able to enjoy eating chocolate.
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Hemmings has an interesting story of how he got into the ‘better for you’ food sector. Prior to his days in the food industry, Hemmings was a counselor working with young offenders and mental health clients for about fifteen years. Hemmings, an avid festival and concert goer, noticed that at these events there were very few healthy food options, everything was either fried or everything had sugar on it or in it. Being an avid runner, Hemmings would usually start his day off making different types of fruit shakes to kick off his day or to have as a snack when looking for a boost of energy. So, Hemming took the entrepreneurial leap of faith and started a fruit shake company and hit the road showing up at different festivals and events. Hemmings explains, “We would put together this Caribbean style hut, and have reggae music playing from it and we made natural shakes all weekend. It was a big hit, the shakes not the music. The shake business was a lot of work.
Hemmings discovered kettle corn while on a trip to the US. For those of you that have never tried this tasty treat, it is popcorn that is kettle cooked, offering a not too sweet and a just a little bit salty treat. Hemmings pivoted his “better for you” business. Once back after his trip, he re-thought his business plan and decided that he would rather just sell kettle corn at these festivals. Offering kettle corn meant that he would not have to construct the hut at the festival plus kettle corn involves less ingredients. So now Hemmings was travelling to festivals with popcorn, oil, sugar, and salt as opposed to all the fruit and things that he would have to warehouse in his garage until the festival and throw out afterwards. So, kettle corn was more cost effective and no one else was making it 20 odd years ago, so the demand was amazing, and the festivals drew huge lineups of customers at these events. Hemmings saw an opportunity for a bigger business because it was a huge hit at the festivals, and he knew there was nothing in the grocery stores like it.
Hemmings jumped at the opportunity to be first to market, mortgaged his house and started up a popcorn plant that would provide his tasty kettle corn to grocery stores. Business was popping, because nobody had it at the time, it was a very unique product, and it was a lot healthier than potato chips that dominated the snack food aisles at the time. Hemmings was able to get into many grocery stores pretty quickly and ran his business, Realtreats Inc., for about twelve years. As the popcorn sector grew in the snack food aisle and bigger companies were getting into the segment that could get their products to market more efficiently at a better price point, so it just made sense to sell the company, which is still in business today, running a different brand name.
Those two experiences are what introduced Hemmings into the better for you snack food world. It was also those experiences that allowed him to take on a few different sales manager roles with different health focus companies on the West Coast which opened the door for an opportunity to work with Ross Chocolates.
Hemmings started with Ross Chocolates about four years ago. Hemmings explains, “I was looking for an opportunity to work for an amazing company in the health food sector. At the time Ross Chocolates was a very small company, but I knew they had a great product, and I really liked their customer focus and what they were doing in the ‘better for you’ and diabetic segment.”
Hemmings has been with the company for a little over four years but the company itself was started over twenty-five years ago in 1996 by Bob Ross. The Ross Chocolates story started when Ross, who was an avid chocolate lover, was diagnosed with diabetes. Not wanting to give up chocolate he grew frustrated in his search for a recipe for chocolate without sugar. At the time there were very few and even less that tasted good. So, the journey began, Ross started the company, Ross Chocolates and started his quest for great tasting sugar free chocolate. The company did really well initially with great sales in Canada and expansion into the U.S. After the popularity of the Atkins Diet started to fade in the late 90’s and early 2000’s sales began to slow down a bit. There was very little new product being put out by ‘better for you’ chocolate makers. That along with little focus on sales meant that sales for the company declined rapidly.
A new owner and focus came into the Ross Chocolates brand in 2016 as Stefano Urbani saw an opportunity for growth of the brand that had done so well in the past but was now struggling. Urbani had a vision of where the market was going, he knew that he could take over this company and really build it back up to what it was before if not better. And that’s exactly what he did.
Urbani came in and the first thing he did was start a new line that had a stevia-based sweetener added to it. Hemmings explains, “This was a game changer and extremely important because the original Ross Chocolates line was sweetened with Maltitol. If you had a very, very sensitive system and you ate a lot of it, you might have some digestive issues. So, with the new sweetening blend that Urbani had introduced into the mix, that problem was avoided, because it was processed by the body totally different, and you didn’t have the same issues which allowed people to be able to eat chocolate like they would regularly do without having to worry about the possible side effects.”
People enjoying chocolate was very important to Urbani. Something else that was very important to him and that Urbani wanted to keep as part of the brand was its diabetic connection which was the core of why the company was started in the first place. Urbani made it part of this company’s mission to put a certain percentage of all the sales towards supporting diabetes research and events in both Canada and the U.S. like the study that was recently completed by the University of British Columbia where their data proves that sugar free dark chocolate, like what is offered by Ross Chocolates, does not spike blood sugar levels in Diabetics.
The study confirmed that, “A sugar-free (stevia, erythritol, and inulin-sweetened) dark chocolate bar led to a lower blood glucose iAUC compared to a conventional dark chocolate bar in people with diabetes. It appears that sugar-free dark chocolate could be consumed without compromising blood glucose control in people with diabetes.” So often companies in the better for you sector make fruitless claims that are not substantiated by facts. That is why funding for this type of research is extremely important to both Urbani personally and the brand to ensure the science is inline with their marketing.
In looking to build a better business and brand Urbani felt that the Canadian market was good, did it have room for growth, well of course it did, but the U.S. really had the potential to take the business and the brand to the next level. So, in 2017 Phil Hemmings was hired to lead the charge and expand the business into the U.S, “Stefano asked me to come in and to first oversee the Canadian sales, but really to prepare the company and launch into the U.S. So that was my main role when I came in four years ago.” Hemmings goes on to say, “There was a lot of work to do at the time. The packaging really needed to be changed. We felt it was kind of okay at that time, if we were looking to just stay on the shelves of pharmacies, but we really felt there was a broader market for our product. We felt that grocery and natural food stores would be open to our products. We saw the way the market was shifting slightly and moving towards ‘better for you’ products, with consumers looking to reduce sugar in their everyday diets. There was just a lot of evidence and information pointing to the market shifting and we just knew that this would be a great opportunity for us.”
Wanting to capitalize on these opportunities, the company invested in their facilities, upgraded all the equipment and capacity just in case they landed a national account south of the border, they wanted to know that they had the means to fulfill that order. But that was not the only reason for the investment. They also wanted to make sure that they had top notch safety standards for the employees and for their consumers. They became BRC certified, which is a third-party certification to set standard that manufacturers, brand owners and retailers must fulfill to safeguard consumers. It is also one of the highest safety standards that you can be awarded for a production facility. Hemmings says this was important to the businesses because, “We wanted people no matter where they were in the world, to see that we were BRC certified and know right away the type of company that they were dealing with. We wanted them to know that in addition to the quality of our product, that we took their safety very seriously and we took our business seriously.”
Most Canadian manufacturers will tell you, “What works in Canada doesn’t necessarily work in the US.” How you get accounts and the passage or travel to those accounts can vary north and south of the border. Thankfully, they were able to source a lot of brokers, but trying to find the right one that offered the right distribution and path to market was a bit of a challenge. Hemmings adds, “We finally were able to get everything in place a couple of years ago when we listed with UNFI, which is one of the largest natural distributors in the U.S. with a great broker team.”
Ross Chocolates was ready, well that is what they thought, at the beginning of 2020, just as COVID hit. The company had about a dozen different events and trade shows in the U.S. to help support the launch and as we all know these events were axed and they were again forced to pivot their launch from focusing on in person meeting at events to relying on product images, some cool bullet points from their products and try to get sales in the U.S. which was challenging.
There are a lot of sugar free products out there. What truly sets Ross Chocolates apart from the rest is their taste. People just don’t believe that it is a sugar free product, given that it tastes much better than a lot of regularly produced chocolates that are on the market right now. Hemmings adds, “Taste is our weapon when we are doing a presentation whether to a buyer or at a trade show to an end consumer. So, we really were kind of handcuffed by not being able to get out into that market to be able to really show people what our chocolate was like, especially how it tastes.”
The upside of this was, it allowed the team at Ross Chocolates to look at a couple of other things, one of them being how they were producing chocolates in our facility. They had a recipe that a supplier was making for them. They decided to again upgrade their equipment in their facility, so they were able to take more control over the recipe. In doing so they were able to eliminate a lot of ingredients that didn’t need to be in their chocolate. They were able to adjust the taste portfolio to make it much better than what it was previously. They were able to really look at their sourcing for cocoa and they were able to secure a sustainable cocoa vender called Cocoa Horizons, whose purpose and mission is improving the livelihoods of cocoa farmers and their communities through the promotion of sustainable, entrepreneurial farming, improved productivity, and community development, which protect nature and children.
The Ross Chocolates team also use the downtime brought on by the pandemic to focus on expanding their flavour offerings with flavours like cherry almond and salted caramel, but also offering different products altogether such as non sugar added Chocolate baking chips, Chocolate covered Almonds & Hazelnuts, and a Luxury Line of 0% Sugar Gifting Chocolates meant for the Premium Market.
When asked about the culture and what it is like to work at Ross Chocolates Hemmings answered with, “We’re a pretty small team, but also a very committed team, aside from the marketing manager, everybody has been here for at least four years. We all have the same goal in mind, so our hats are interchangeable sometimes. We all know there’s a job we have to do and we’re all 100% committed to making it happen. Stefano is a great leader, he makes sure that you know what you need to do, that you have the resources to do it and then trusts you to do it. If there’s a big issue or problem, he is happy to help with his input, but otherwise encourages the team to try to solve it. I think it’s that sort of leadership that has really helped us here. We know that we can count on each other and that has been the key to the great successes we have had, especially the last six to eight months as we have seen some big steps in growth. We’re really going through a transition time right now with the business, moving from a $1.5 million company, to potentially a $4 or $5 million company. So, what that is doing is forcing everybody to stretch again and to look at things differently including our roles and our vision for the company as it continues to expand.”
We were curious if a consumer’s past perception of sugar free products being essentially taste free as well was hurting their growth? Hennings was quick to respond, “I remember early times, when I tried sugar free chocolate, it was pretty much like eating brown chalk.” Hemmings goes on to talk about the first time he tried their product, “When I came here for an interview, I met with Stefano, I saw the facility. I was on my way out, to be honest I was heading to another interview with a much bigger company, but for a similar role, and Stefano gave me some chocolate on my way out to take with me and said, ‘let’s connect in a couple of days.’ So on the way to my second interview that day, I tried the chocolates and was blown away. I was just like, I had to read the label over a couple of times, just to make sure they weren’t trying to sneak me some sugar in somewhere. I was so impressed with the product, when Stefano called me the next day to follow up. I was, yeah, I definitely want to be a part of this journey. I was our target customer, so believing in the product helps you push through some of the criticism that might come initially from consumers that have not tried the products. My mindset is, how could you not like this.” That confidence in the product is company wide and it comes through when they are speaking with others about their offerings. They know that they have an amazing product, and the market is changing for ‘better for you’ products. A lot of people are moving toward or need to move towards sugar free options. With obesity and diabetes rising and customers looking for healthier options, the market is moving towards ‘better for you’ with more people following Keto and Paleo diets.
Having good sugar free products is certainly going to help some gravitate towards making these lifestyle changes. Plus, there are a lot more products out there now that are sugar free, but as Hemmings says, “There are a lot more brands and products out there than they used to be in this segment. And they’re not all good. And I know that because my desk is covered with them.” Being in the business means that Hemmings gets to try everything out there, and he will tell you that there are definitely a couple of really good products out there other than Ross Chocolates.
As the business looks to expand Hemmings is seeing the demand for the product also grow. At one time a buyer wouldn’t take his calls regarding sugar free products because they already have one in their stores or to offer their customers. Now they are calling him, because they understand the value of these products to their customers because more and more customers are asking for them and wholesale and food services are becoming a bigger part of the company’s offering.
Ross Chocolates is more than a company that is selling sugar free products, it is a company that cares about its customers and their love for chocolate. Yes, they have won many awards, but the most satisfying thing is the emails that they receive which really tells you something about a company and their product. I mean, when was the last time that you ate a chocolate bar and then felt that you had to get online or send the company an email saying how good it was? I know that I have never done that. Taste aside we believe what really sets Ross Chocolates apart from the rest of the industry is their commitment to a diabetic community. It was the reason that the company was founded and continues to be a driving force day in and day out for the business because everyone should be able to enjoy eating chocolate.
by Ryan Myson