The Chocolate Ambassador

You know it’s a serious situation when Louis Tanuhadi said that the chocolate industry has no future.

You’ll be hard pressed to find other person with vast experience and the understanding of Indonesian chocolate industry better than Louis Tanuhadi, Tulip’s Embassy of Chocolate. As one of the most vocal person in campaigning the use of real chocolate in Indonesia through the couverture product line, The Embassy of Chocolate, and Chocolate School by Tulip, Louis wrote a book specifically about chocolate, Chocology in 2012.

In the middle of his tight schedule, Passion Media had the chance to discuss deeply with the man about his concern on the future of chocolate industry, Tulip’s choice, definition of chocolatier, his personal dream, and the meaning behind his unique position “The Embassy of Chocolate”.

In various occasions, you always say that chocolate industry has no future, please elaborate.

I see the reality, supported with the data I got from Googling, newspapers, and social media. Firstly, people are shocked by the chocolate observers who predicted that the cocoa tree will be extinct in 2025 because of the climate change.

The second, is the growth of global chocolate consumption, which is 6%, is not supported by the fact that the supply of cocoa bean is continuously declining every year. There are many factors that cause it, one of the them is the climate change, as mentioned before.

Higher demand, and lower supply, I assume the price is escalating.
Definitely. However, it’s not that simple because chocolate is dynamic, along with cocoa bean, we have another ingredients, such as sugar and milk. This year, the price is relatively stable because even though the cocoa bean’s price is rising, the sugar price is dropping. It’s different case 2 years ago where both of them were rising.

In addition, cocoa is quite complex, because from cacao bean, we’ll have 2 products: cocoa butter and cocoa powder. The problem faced the the cacao farmer is, when they produce cocoa butter (usually used in cosmetic industry) to meet the escalating demand, they will produce as much cocoa bean as possible to get the cocoa butter, as a result you’ll have to keep the excessive cocoa powder. Cocoa powder is only used in compound (chocolate) and food industry. As we have another year, the demand of cocoa powder rised, but the demand of cocoa butter declined. They never go along. The thing is, in the past few years, the demand for both products has risen together.

It means good thing, right?
Good for the cacao farmers, but it’s also an issue, as we don’t have enough cocoa bean supply. In addition to the declining supply and climate change, the third factor is the biggest one, monopoly. Don’t imagine the old style monopoly, this one is subtler. Some of the world’s leading chocolate brands entered region such as Celebes, built a facility there, interact directly with the farmers to create emotional relationship. We used to take 3 hours drive to the cocoa farm, now we only need 1 hour, thanks to them for improving the infrastructure. Tulip used to do that also.

“Used to”? You don’t do it anymore?
Yes, we no longer have the cocoa business, that’s a long story. In short, Tulip used to be a part of Petra Food, owned by General Food Industry, which was currently acquired by Callebaut. For the big names, cocoa bean supply is not an issue.

How will Tulip respond to this?

For chocolate manufacturers, we only have 2 options: to be premium, or to be mass product for middle low market segment. The last one will struggle because they will only get the leftover bean from the big companies. If you’re paying attention, we have more chocolate manufacturers, which invested in this business already, offer products that are made not from cocoa bean, such as strawberry or green tea flavored white chocolate compound, or chocolate rice which consisted of sugar, vegetable fat, and very little cocoa powder.
If you want chocolate made of cocoa bean, you have to go premium. What’s the trend? You can see it from the rise of artisanal chocolate, which only produce 20-30kg chocolate, you know it also as “bean to bar”. If you know big chocolatier names such as Godiva, they don’t produce their own chocolate, they get the supply from the big names. So, in the future, there are only 2 choices: artisan or mass production.

Which way will Tulip go?

Premium, but not to bean to bar. Some people complained, “Tulip is expensive”. Indeed, but not because we want higher margin, because there are cost we should pay, for certification as example. We have complete sertification, from the lab accreditation, halal certificate, we even have kosher certificate. These kinds of assurance cost a lot. This is why we only focus on supplying big companies, they trust PT. Freyabadi Indotama (Tulip’s company), they know our standard, they pay more for that.

And what about Tulip’s existing retail market?

The market segment is similar to pyramid, we aim for the middle up, because they are more loyal. We can’t penetrate into all segments, yes it’s true that we will lose the fat segment of the market, but it’s inevitable, we can’t focus there. We might lose volume-wise, but we can maintain better relationship and have better margin, it’s still enough for us.

Does it mean that you’ll only produce real chocolate?
We don’t ignore the compound market, we’ll maintain it, but we won’t focus there. Even for the retail consumption, such as for housewives, people started to switch to real chocolate. They know the real chocolate in Indonesia is Tulip. Meanwhile, the middle low segments are not loyal. When the demand is only limited to the price tag, sorry, we can’t help you, again we can’t aim for all segments.
It’s a decision we took long ago. In 2006, when I have the idea to produce couverture chocolate, everybody laughed at me. Today, you’ll see many middle retail manufacturers produce couverture, simply because they have realized that we only have those 2 options. I’m not saying middle low segment is wrong, it’s just they have to struggle in the future: the customers are not loyal and only demand low price, while facing the low ingredient supply.
It’s no wonder many manufacturers turn to carob (chocolate substitute), it happens. Is it wrong? No, it’s what the customer wants. I mean, when you don’t have money, you’ll be happy with any bags. When you have money, you started to purchase Louis Vuitton, when money is not a concern, you’ll opt for Hermes. In a year, Hermes only sells few bags, while the middle low brands may produce millions. It’s a matter of choices, it’s not about right or wrong. In Tulip, the compound segment is the money maker, while the premium (couverture) one, The Embassy of Chocolate, doesn’t produce as much, but we’re okay with that.
This answers your question in the beginning, if we talk about chocolate, the one that doesn’t have future is this middle low segment. For the middle up, brands such as Valrhona, Cacao Barry and Callebaut they will be around for good.

What about the real chocolate consumption growth in Indonesia?

For our production, internally, of course we have growth. It’s still above 2 digit. In this August, you’ll see a breakthrough from Tulip, just wait.

Why did you put The Embassy of Chocolate behind Tulip?

It’s similar with Toyota and Lexus. You can buy Fortuner or Alphard, but that’s Toyota, while Lexus owners can proudly say, “this is Lexus!” When China marketed cars with Mercedez appearance, do they sell well? There’s no trust there.
No matter how hard I fight (for real chocolate), I won’t succeed if I’m still using the name Tulip, that’s why I use The Embassy of Chocolate. We’re currently using both names as part of the process, it may work 50 years from now, when I’m no longer here, but we have to start early, it happened in 2006.

If I were to use The Embassy of Chocolate from the beginning, who would buy?

People bought because Tulip, “So, you’re part of Tulip and Ceres?” The younger generation chefs don’t know Tulip, they know Callebaut, Cacao Barry because they are studying abroad. Perhaps now is the time to separate Tulip and Embassy of Chocolate. Of course we need huge promotion for this. People are wlling to spend extra 40% for big brands, simply because they have the name, they have the trust.
In 2007, I went to Jember to get criollo (read: krio-yo, the best cocoa bean variety in the world), they said they have none. I ask the price if they have it. They answered, “how many tons do you need?” It means you have it, right? Latter, I found out that they supply the bean for Michel Cluizel (premium chocolate brand). If I were to use criollo back then, it was suicide, but now? Perhaps it’s time.

How do you define chocolatier?

Firstly, chocolatier came from the word chocolate, what is chocolate? I refer back to the codex, it was written that chocolate refers to real chocolate made of cocoa butter. So, if someone is known as chocolatier, he should be working with real chocolate, not compound. In this sense, you can’t claim yourself as chocolatier if you use compound.
The second, he has to make chocolate products. If you’re in Belgium and said to the Belgians that you want to buy chocolate, bonbon or chocolate bar will be on their mind. In France, some leading chocolatiers may offer cakes, but they have racks of chocolate products. The third one, he has the skill and knowledge to work with chocolate, he also can explain it to everybody.

How far does he have to know? Would it include the knowledge from cocoa bean?

No need. He might only know the common knowledge, let’s take Jean Francois Arnaud, a Meilleurs Ouvriers de France (MOF). Even though he’s a chocolatier and sugar expert, he admitted that he has no idea of how to produce chocolate from cocoa bean.

What about the new bean to bar players? Can they be called chocolatier?

I have no problem as long as it’s other people who call them, not their own claim. Why I said that? Because in Indonesia, we have too many mistakes like these, people call themselves as chefs, do you know what a chef is?

A chief cook in a professional kitchen.
Exactly. If people call me chef, I’d say, “sorry, I’m not a chef”. Even though I worked as baker in Germany, I never lead the kitchen division; I don’t have background as a chef. It’s different case when someone own a restaurant and become the head of the kitchen, feel free, chef actually comes from chief. That doesn’t mean you may call chef to to someone who cook in TV. It’s the same with chocolatier, I don’t have a problem as long as the claim come from other people. I’d say that the one that has the right to give the title is journalist, like you, it’s like paying respect.

Let me ask you about your official position, Embassy of Chocolate? What’s that?
I don’t have any position. If we have Embassy of Chocolate, let just say I’m the Ambassador. The most related term would be Business Development Manager, because I develop business in Tulip, but I also in the kitchen, responsible as quality control in production, doing demos. Therefore, it’s difficult to pigeonhole my position. If somebody asks it, I’d say I don’t have one, and I’m happy with that.

Outside Tulip, what’s your personal dream?
My dream and idealism is only one: I’d be glad if I can see our red and white flag waving in France (pastry competition). We’re not talking about nationalism here. I won’t be satisfied if it’s only in Singapore, even though I know that we have to go through Singapore in order to get to France. Imagine, Malaysia is already ranked 7th in the world, and Philippines is 11th. Until today, I can’t find anybody who’s serious. This is why I join the chef association (Indonesia Pastry Alliance) as Secretary General, I want to find out why.
After a while, I knew that there’s gap between older generation chefs and younger ones. The older chefs are tired, they don’t want to give their knowledge and skills to the youngsters. If there are some, they don’t know which youngsters.

The knowledge transfer in workplace is something inevitable, isnt’t it?
I’m talking about competition, not job, they are different. Competition is more to art, idealism, and skill, while working in hotel and bakery is more to give what the customer wants. When the older generation chefs are willing to teach how to make the proper mousse, most hotels won’t give time for that. It’s different with hotels in Singapore or Malaysia, the management gives them spare time, they also support by giving the ingredients. In here, only few companies are willing to support the competing chefs.
When we have the hotels that give the time, the younger generation chefs are not willing. There are many reasons. I can’t mention all of them. When I join the association, I understand that the older want to teach, but haven’t found the right people, while the younger generations don’t know us. When both of them meet, I was disappointed because of the younger ones’ excuses, they have many things to do.
I started to ignore people from hotel and bakery industries. If we want to have a proper Indonesian team, they have to come from the proper organization, schools. How can Malaysia have this kind of achievement? Because they have Pastry Arts Malaysia, the one who’s competing are the lecturers. Their job is only learning and teaching, so when you have competition, they don’t have the responsibilities of production or taking orders, just like what happened to chefs in hotels and bakeries.
That’s my idealism. You can write this down, my mission is to find passionate, talented, dedicated young chefs under 30, to join competitions, I need at least 3 people.