16/06/2011 - 00:00

Whistler’s meets changing market

16/06/2011 - 00:00

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CONTINUING the family tradition of operating Western Australia’s oldest confectionary manufacturer hasn’t been all sweetness and light for owner Ian Sargent.

CONTINUING the family tradition of operating Western Australia’s oldest confectionary manufacturer hasn’t been all sweetness and light for owner Ian Sargent.

Rising ingredient prices, lulls in consumer spending, and staffing issues – not to mention never having run a business before – were just some of the challenges Mr Sargent encountered during the past decade.

Mr Sargent’s father set up Belmont-based Whistler’s Chocolate Co in 1968. Three decades later, the then 25-year-old Mr Sargeant bought the business from him.

“I was not a business person; I was an industrial designer by trade, designing medical equipment,” Mr Sargent said.

“But when you grow up in a business like this it’s definitely in your blood and part of me wanted to keep the business going and in the family.”

Mr Sargent said Whistler’s business model had changed significantly during the past 40 years, with its predominantly retail and manufacturing model shifting to a wholesale and manufacturing business.

“Whistler’s was very much retail-based back then, because there was very little competition in the 1970s and early 1980s,” Mr Sargent said.

“The manufacturing part of the business was supporting around five shops in the big shopping centres, and in those days the margins on the products were very good.

“But into the mid 1980s, the cost of the leases became worth more than the business.”

Whistler’s closed its retail stores in the mid ’80s and decided to supply its products into Coles and Woolworths stores.

Mr Sargent said this also proved financially unviable for the company due to cost-cutting measures employed by the supermarkets and the influx of mass-produced product from overseas.

Whistler’s now brands its products into more than 80 IGA stores across WA and manufactures confectionary for other chocolate companies, which rebrand the product as their own.

“In the early ’90s, IGAs were starting to come on strong and you could still talk to the owner, get a good rapport with them and check your stock, so IGAs were our target and that was their point of difference from Coles or Woolworths,” Mr Sargent said.

While he said he wouldn’t re-introduce Whistler’s products into the major supermarkets, he had been selling his products at markets and at the Royal Show.

“We are really starting to see a pattern where people are sick of mass production and are more likely to support local produce,” Mr Sargent told WA Business News.

Traditionally experiencing a steady increase in revenue of between 10 and 20 per cent each year, Mr Sargent said a change in consumer sentiment had led to a decrease in sales of late.

“Anyone in retail will tell you they are having an absolute hell of a time at the minute and I think people are being more cautious about their spending because utilities are up and they got bitten last time,” he said.

In addition, recent natural disasters and the price and supply volatility of cocoa as a commodity have forced Mr Sargent to put up his prices between 10 and 15 per cent.

“Ingredients are going through the roof, sugar has gone from 90 cents to $1.60, so we are talking 40 to 50 per cent rise on some products over the last six months,” he said.

In addition, Mr Sargent said the mining boom had caused him significant staffing issues.

“I’ve offered apprentices good wages and good training and they come in and say ‘I can get $40 an hour working on the mines,” he said.

The day-to-day running of the business has also been a challenge for Mr Sargent.

With a staff of 20 to manage, he recently promoted one of his staff to a managerial position to help with the operational side of the business.

“I’m not a business person, I am a creative person and being a small business I’m on the floor six or seven days a week; but by having someone in that role I can get out of the business and look at the bigger picture,” he said.

Mr Sargent has shifted his focus to Whistler’s new venture – a store, cafe and ice-creamery to open early next year and creating a website for online sales.

“We’ve had to finance it and its taking a big risk, but it keeps you interested in the day-to-day tasks and this is my dream and I would love it to come together.”

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