FUTURE PROOF: Skelligs Chocolate:A blaze almost put Colm Healy out of business, but he was determined to salvage his company

November 2010 was a defining moment for Skelligs Chocolate. The companys premises were destroyed by fire and owner Colm Healy was on the brink of closing the doors on the 16- year-old business for good.

“It was a horrible experience, absolutely gut wrenching,” he says. “In the dark nights that followed, I seriously thought about walking away. But two main things made me stay. One was great support from the local community; the other was that I decided that, if I was going to exit the business it would be on my terms, not because I was driven out by something beyond my control.”

The company relocated from its base in Ballinskelligs, Co Kerry, to a temporary premises nearby and tried to keep going. However, the disruption was huge and sales were affected.

“We hobbled along with about 40 per cent capacity. Our goal was to be in a new, purpose-built facility within a year. We managed this with a week to spare but there were a lot of ups and downs as we tried to find a site and source equipment.

Strategic importance

“I also got married to Nickie and we had a baby. Quite a dramatic year really,” Healy comments wryly.

The fire was devastating for the company but, paradoxically, the fact that it happened during the downturn took some of the sting out of it.

“We couldn’t have afforded the unit we have now five years ago when costs were so much higher,” Healy says. “We still spent over a million, but have premises that are three times the size. This is of major strategic importance as it makes it possible to develop the business down two distinct tracks – chocolate production and tourism. Around 50 per cent of our turnover comes from direct sales to visitors.”

Healy bought the company, which employs 10 people full-time, in 2004. He was attracted by it because Skelligs is an artisan producer that makes its chocolates by hand.

In 2006, the company joined forces with the Cocoa Bean Chocolate Company to pool resources and produce complementary products. (Skelligs makes truffles, Cocoa Bean makes bars.) This merger added turnover, made better use of the facilities and improved margins.

Healy has a background in electronics and set up his own IT support company in Dublin in the 1990s. On a visit to Kerry, he discovered that Skelligs Chocolate was for sale and the rest, as the saying goes, is history.

Healy’s first task was to learn about chocolate making, his second was to restructure the company.

“I knew the fundamental product was excellent. What needed attention were the dangling ends,” he says. “We needed to rationalise our range, develop a good website and address key issues such as continuity of supply.”

Sales to tourists have always formed part of Skelligs’ income but with a lot more space available, Healy has become more focused on developing this aspect of the business.

The new site is big enough to accommodate a coffee shop (which employed eight people during its opening season last year) and the factory’s open-plan layout means visitors can see the chocolates being made.

“We have been working with Fáilte Ireland to up our game and maximise the visitor potential,” Healy says. It is not finalised yet but we are hoping to be included in the Wild Atlantic Way as it comes right by our door. This year, we are also planning to run chocolate courses and workshops for adults and children.”

Healy has been flat out trying to rebuild the retail sales lost in the aftermath of the fire by attending trade shows and pushing hard to have the product listed into new outlets. This has involved major changes to prices and packaging.

Value for money

“In the year we were limping along, the market changed,” Healy says. “Almost overnight price became king and when we looked up as it were, the landscape had completing changed. In response, we redesigned our pack sizes to hit specific price points while also offering value for money to cost-conscious consumers.

Skelligs exports about 15 per cent of its output but Healy says the focus for now is building up its home base.