Coco Delice Fine Chocolates abruptly shutters, The Bread Project Forced out

Published On September 18, 2015 | By Rob Arias | Local Business, Minimum Wage, News & Commentary

Coco Delice Fine Chocolates Chef Dennis Kearney recently announced the sad closing of his six-year Emeryville chocolate business effective August 31st. Kearney noted the elimination of a small business tax credit by the state and a recent 20% rent increase compounded with other increases were partially to blame. Kearney also noted that the two month old highest in the nation Minimum Wage Ordinance was probably “the straw that broke the camel’s back” for them.

Neighboring nonprofit The Bread Project that help train the low-income, refugees and those with employment barriers have also recently departed from Emeryville after a significant increase in operating costs. The rent for their 8,000 square foot space was recently increased from $11,000 to $16,000/mo. (45%) forcing them to move to Berkeley. Both parcels are owned and operated by Gerow Properties in Lafayette.

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Photo: SF Weekly

Kearney noted that despite a growing economy, local financial pressures had recently become too much to bear for his business. “I don’t know if everyone understands the pressures on Small Business. Workman’s Comp increases, spiking rents, Healthcare, payroll taxes, our electric bill almost doubled … and now tack on the highest in the nation minimum wage? At $12.25/hr. we might have been able to squeak by but the trajectory was not sustainable for us”. Coco Delice employed twelve full-time and part-time people.

Kearney announced the sad closure in a letter to his customers:

Hello Coco Fans-

It is with mixed emotions that I let you know that Coco Delice Fine Chocolates will cease operations at the end of August, 2015.

It has been an amazing experience (almost 10 years!) with lots of ups and downs. As some of you know, that this company started out my desire to get in touch with my creative side. Never in my wildest dreams did I think one day I would be the founder and owner of a successful artisan chocolate company.

Through the years, I have amassed an incredible amount of technical knowledge and small business insight, some of it consciously and some of it thrust upon me. But what kept me going during times of doubt was the support and encouragement of Coco’s customers, many of whom have became wonderful friends. I was also fortunate to have some amazing staff work for me throughout the years and could not have gotten this far without them.

Looking ahead, I will be shifting my focus on trying to help other chocolate and confection oriented entrepreneurs as an outside consultant, helping them create and develop their skills and interests. I am still speaking with a number of small chocolate makers who might assume some of our products. I will share any updates with you once we know more. I am also looking forward to my first “normal” holiday season in many, many years!

As you know, there are so many passionate artisan confectioners these days, doing really cool and amazing things and they all need your support. It takes courage to pursue one’s dream, but it takes a dedicated community to nurture those businesses and help them grow.

In closing, I would like to offer a huge Thank You to each and every one of you who supported Coco Delice through the years. May you always find your “Sweet” spot when you need it.

Warmest Regards-
Chef Dennis

 

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Many of the students that The Bread Project trains were previously incarcerated, battling addictions or other employment barriers. One of the unintended consequences of the MWO may be the departure of nonprofits that tend to operate on thinner budgets (Photo: cuisinenoirmag.com).

Bread Project Executive Director Alicia Polak noted the tandem of massive rent increases with rising labor costs are a 1-2 punch to Emeryville small businesses and nonprofits like hers. Polak noted the impacts of the MWO on her business model had she been able to absorb the rent hike. “Of course it would have had to be a consideration had we stayed in Emeryville” noted Polak through a phone conversation. “There would have had to have been significant changes that may have included hiring fewer people, an increase in the price of our product … it would have been a real challenge, but I believe in innovation and ingenuity and we value our employees. These are the current realities for for-profit and nonprofit small business owners alike.”

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Gourmet creations like this Bison Black Magic Chocolate helped put Coco Delice on the map (Photo: 650Food.com). 

Coco Delice originally opened in Oakland in 2006 and moved to The Park Avenue District in 2009. They specialized in French-inspired chocolate treats, gift boxes and candy-making classes. Their product graced the shelves of premium grocery stores like Whole Foods and were honored within the industry for their chocolate artistry including a Good Foods Award last year.

Kearney liked the proximity to the freeway and the climate of Emeryville, but noted the city didn’t offer much of an advantage for his particular business model. “I’ve never been particularly fond of working with the city. The planners were difficult to work with and seemed to give preferential treatment to big business. I feel like if I was Dennis from Pixar, the city would be more likely to return my call than Dennis from Coco Delice. I wanted to put a sandwich board up during the Holidays to give us some exposure. I sent in the permit … and they never got back to me.”

“It’s not just the labor, everything is going up. I really don’t know how some people stay in business.” Dennis also expressed preference for a regional approach for any increases in to the Minimum Wage. “The Oakland Chocolate Company is literally a block away and their wage scale puts us at a bit of a disadvantage.”

What’s next for Dennis? Coco Delice has already begun selling off their assets and will completely vacate the spot by the end of the month. Dennis plans on taking a short trip to Hawaii to clear his head and then strategize his next career move that may involve something on the consultant side of confectionary business or go back to his “day job” as an Environmental Consultant.

When asked if Dennis would consider Emeryville for his next business venture, he paused. “I think If I was, I would probably look at Sacramento. My advice is to make sure you have a viable business model in the location for what you want to do. Unfortunately, mine apparently was not here in Emeryville”.

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About The Author

is a third generation Californian and East Bay native who moved to Emeryville in 2003. A new parent in the community, he can often be seen walking his French Bulldog rescue "Fiona" around his Park Avenue District neighborhood, traversing the greenway on his bike or enjoying his favorite Emeryville small businesses. Rob's "day job" is as a creative professional.

23 Responses to Coco Delice Fine Chocolates abruptly shutters, The Bread Project Forced out

  1. Kevin Mulvey says:

    Being forced to move to Berkeley, where operating costs are lower? How insane. How much evidence do you need that the current well meaning, reality-avoiding “progressive leadership” of Emeryville does not get it? Maybe soon all those pesky businesses and their tax paying employees will have fled to Berkeley and Emeryville can go back to being Rotten City..

  2. Krisna Hanks says:

    We are very sorry to see two of our local biz neighbors move away. A sad day for Park Avenue businesses and residents. Both Coco Delice and The Bread Project offered unique, creative and inspiring services to our community. The challenges of owning a small business in this area grow rougher by the day.

  3. Joe Barnhart says:

    If your business is national in scope, it makes sense to move out of California. You can rid yourself of state income tax, crippling minimum wage ordinances, and debilitating EDD bureaucracy at the same time — a three-fer in one!

  4. Anonymous says:

    It begins.

    Coco Delice, I apologize to you and your ex-employees on behalf of Jac Asher, Dianne Martinez, Scott Donahue, Ruth Atkin, and Nora Davis for the loss of your job. They wanted to be on the news.

    Every small locally serving business I talk to is struggling now. And that’s with a fantastic economy. When established businesses like this are moving out in good times, wait until the economy slows a little.

    The city council just killed any chance Emeryville had to sustain a diverse local economy. Sell the place to IKEA and McDonalds. No small, local business in its right mind would open here. If you do not have the economies of scale of Target or Walmart and you ate the type of business that hired entry level workers, this is NOT the city for you.

  5. Anonymous says:

    This is so sad. I really want to believe that locally produced goods and services can be the antidote to an unsustainably globalized economy. However, it seems so hard to keep a small business afloat, no matter how much planning or how much elbow grease one puts in. I’d be surprised if many were still trying to make it work in Eville come 2019.

  6. Anonymous says:

    Where are all the people who support the MWO? It seems like almost everyone hates it.

    During the council meetings, I saw about 5 actual Emeryville residents speak in favor of it. Lots of union people showed up from out of town (the same ones now pushing a $19 minimum wage in Berkeley). Everyone else was opposed. The comments and polls here also point to a lack of resident support.

    I’m getting the feeling that there has never been any real community support for the MWO.

  7. Anonymous says:

    A 45% increase in RENT? That sounds like the killer, right there. It’s happening all over the Bay Area, not just Emeryville. So many people are just one rent increase away from living out of their cars. I’m one of them. My rent has gone from 1000 a month to 1500 a month in 3 years, and my wages have gone up 1% per year. It’s legal for them to raise the rent–it may not be right, or moral, but it’s all perfectly legal. The solution is fewer people or saturate the market with affordable housing and business locations. Supply and demand. And get rid of the get-rich-now slum lords and avarice mentality.

  8. snorc says:

    Interesting that advocates for working people are vilified as small business predators while the profit amassing landlords are just doing the respectable job of responding to the market.

    • Rob says:

      Which part of the article do you think paints landlords in a flattering light? The blood of small business heading into 2019 will be equally on the hands of shortsighted politicians and profit-maximizing landlords. If you had watched how the MWO discussion unfolded, you’re observations wouldn’t have been that they were “working for the people”. Working for labor groups and political notoriety is more appropriate.

      • snorc says:

        I was also referring to the preceding comments of fellow readers, not just the bias of the article. I apologize for any confusion I caused. What makes you think I did not follow the democratic process of the ordinance? If most minimum wage workers already had access to labor unions, they would have long been able to advocate for themselves collectively. There are no other beneficiaries to the MWO except to the families of the workers. As a resident of Emeryville who earns a living through work, I am proud to know that under-represented people can sometimes access the local political system which has always been dominated by deeper-pocketed commercial interests.

  9. Anonymous says:

    The people raising the minimum wage too high and too fast are not advocating for working people. They are advocating for organized labor. There’s a big difference.

    EBASE and the SEIU who were behind Emeryville’s wage hike do not work for the poor, the unemployed, or the marginalized entry level worker. They work for the unions. And as the article above highlights, helping one hurts the other.

  10. nGruen says:

    Is there any chance to get rent control in emeryville? How would one go about it?

    I get it, that if you are not having a big profit, there is no way to survive the double whammy of minimum wage increase and rent increase.

    Sorry for Emeryville in the long run.

  11. nGruen says:

    It’s really unsettling how there is no protection when it comes to rents. Commercial or residential. I want this area to strive, but when it does, one can easily fall be pushed out. I know that this is known; but I every time I think about it, it seems so crazy that there is 0% regulation.

    • Rob says:

      nGruen, the issue with Rent Control is complicated as much of Emeryville’s Housing stock was built after 1983 which makes it exempt from establishing Rent Control because of the Costa-Hawkins act. If we enacted rent control measures, it would apply to (what I’ve heard) only about 10% of Emeryville. There would have to be a larger state initiative to overturn this. Tenant Protections to make evictions more difficult are a little more feasible.

      • Rob says:

        nGruen, please note that I am not legally versed in this matter so my answer here may not be entirely accurate. I’m working to understand this better and write a post that outlines our options a bit better. Stay tuned!

    • Anonymous says:

      It’s even more unsettling that this lack of protection now also applies to the minimum wage. At any moment, businesses can be forced out with 30 days notice. The profit-seeking landlord has been replaced by the headline-seeking city council.

  12. Anonymous says:

    Forced out because Emeryville raised the minimum wage from $9 per hour to the same as Oakland at $12.25. He could have continued on if he could continue to pay his workers a $9 poverty wage but Rob Arias insisted Emeryville’s minimum wage be raised. All these workers making $9 are now thrown into the streets. Happy Rob?

    • Anonymous says:

      You apparently just arrived in Emeryville or maybe woke from a six month nap.

      I’ll catch you up really quickly:
      – The SEIU strategically identified that having Emeryville adopt an extremely high minimum wage instantly would give them a boost to their national effort to promote a $15 minimum wage in other big cities
      – Some city council members got a bee in their bonnet that they wanted to have the highest minimum wage in the country. Those same council members appeared together at an SEIU rally in Berkeley holding “Fight for $15” signs. The Mayor of Emeryville spoke at that rally and informed us that Emeryville would soon have the highest minimum wage in the country
      – The SEIU brought in union advocates and employees from all over the bay area to show up at council meetings and give the appearance that there was community support. These same people showed up in Oakland and are now making appearances in Berkeley trying to leverage Emeryville’s $16 minimum wage to get $19 in Berkeley.
      – The labor unions conveniently included text in the Emeryville minimum wage ordinance exempting union shops from having to pay the minimum wage that they were advocating for
      – The local businesses counter-proposed a $12.25 minimum wage increase that would align with Oakland (a regional minimum wage), an exception for youth employment, more discussion, a more reasonable timeline, and an economic impact study to determine what the consequences of the ordinance would be on the community
      – All of these requests of the local community were rejected by the city council in favor of adopting the SEIU’s national agenda
      – The SEIU and others began harassing local businesses who signed a petition requesting the city council do an economic impact study.
      – The city adopted the minimum wage ordinance and gave local businesses slightly less than two weeks notice that they had to raise wages by up to 60 percent
      – Members of the city council began doing national media appearances.
      – Emeryville’s small businesses began raising prices, cutting hours, laying off workers, and shutting down.
      – Rob Arias insisted on reporting on what was happening.

      • Rob says:

        Whoa … can I hire you as a freelance correspondent? You left out one important detail. The Community and small businesses advocated for a regional approach. Unions and even R.U.L.E. advocated for “a path to $15” … then Councilmember Jac Asher, despite stating in the Chronicle that she was supportive of a regional approach, proposed something even more radical than what the unions asked for by graphing a path toward $16 within 4 years. Scott Donahue, who also stated a preference for a regional approach while he was campaigning, “flipped” and bended to Asher’s will.

  13. Anonymous says:

    Yet another city council sees the wisdom in doing an impact study to determine the effects of raising the minimum wage:

    http://m.startribune.com/local/blogs/329549721.html

    In Emeryville, we prefer to shoot from the hip and hope for the best. Sorry about that Coco Delice employees.

  14. Anonymous says:

    http://www.latimes.com/opinion/editorials/la-ed-0929-minimum-wage-20150929-story.html

    “It’s the bad idea that keeps coming back. In the final days before the Los Angeles City Council approved the region’s first $15-an-hour minimum wage, the County Federation of Labor tried to slip in an exemption for employers with unionized workers. It was a galling display of hypocrisy by labor leaders who had publicly fought efforts to exempt restaurant workers, nonprofits and small businesses from the new minimum wage, yet quietly lobbied for companies to have the right to pay union workers a sub-minimum wage.”

    “The bad idea that keeps coming back” and the “galling display of hypocrisy by labor leaders” refer to the same exception Emeryville’s city council rushed through at the request of union leaders as part of the Emeryville MWO.

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