Dagoba sale to Hershey draws mixed reaction from locals
Calls poured in to the Dagoba Organic Chocolate office when news spread that The Hershey Company bought the locally owned, successful company.
CEO and Founder Frederick Schilling said he expected a backlash.
Dagoba has operated since 2001, starting in Boulder, Colo. and expanding to Oregon in 2003.
Schilling said Dagoba should make $9 million and produce more than seven million candy bars in 2006. After a year and a half of considering selling, he said it seemed like the right thing to do.
"The only thing that's going to change is we're going to be available to more people," Schilling said.
Hershey and Dagoba announced the merger Thursday morning. By the afternoon, local groups and other business owners in the chocolate world began to call.
Selling to a corporate chocolate company like Hershey — which makes about $4 million in revenue each year — stirred concerns. Schilling said the 40 employees of Dagoba will stay in town. He would not say how much the company sold for.
He said he will continue to buy raw ingredients from cacao farmers, mainly from Latin America. Cacao beans grow well under the rainforest canopy, Schilling said, so expanding to buy more beans from more farmers could be a good thing for independent farmers and rainforests.
"By expanding, we're going to impacting thousands of farmers," Schilling said.
He said he knows some people will accuse the company of "selling out," but he hopes his company will work toward sustainability and farmer welfare for the larger company.
Schilling said he hopes Dagoba Chocolate-lovers will look beyond the prejudice that large companies are evil.
"We're going to be bringing organic principles to thousands and thousands more people," Schilling said.
The news shocked Ashland Chamber of Commerce President Graham Lewis, he said.
"My initial response was, 'this is scary. I don't want them to leave,'" Lewis said.
After speaking with Schilling Thursday, Lewis said growth could bring more jobs to Ashland and be a good thing for the community.
Local sustainability advocates admit Dagoba's shift into the corporate world could have a downside, but some say it is a success story that shows sustainability and organic farming are expanding.
Wendy Siporen, director of The Rogue Initiative for a Vital Economy, said she was happy to hear Dagoba would remain in Ashland. THRIVE is a non-profit organization based in Ashland. The group focuses on promoting small, environmentally-friendly local businesses and agriculture. Dagoba is a business member of THRIVE.
Siporen said locally-owned businesses return more money to the local economy than those with headquarters elsewhere.
"The loss lies in the fact that Dagoba profits will now be sent to absentee shareholders rather than remain in the Rogue Valley," Siporen said. "When a business is locally owned, there is a better chance that business decisions will be made with the community in mind, not just profit for shareholders."
Annie Hoy, outreach manager for the Ashland Food Cooperative, said consolidation of smaller, locally-owned businesses with corporate giants is a fact of life in the organic food business.
"You can mourn the loss of your small local business so many times until you get hardened to it," Hoy said.
She said bringing local, sustainable ideology into the mainstream can be a powerful force that changes and influences large corporations for the better. She hopes cacao bean farmers will still get a fair price for their product when Dagoba buys their raw product. Hoy said some companies with solid integrity have the ability to change something from the inside.
"All I can do is hope that he's right when he says it will have an impact," Hoy said of Schilling.
Staff writer Alan Panebaker can be reached at 482-3456 x 227 or apanebaker@dailytidings.com.
