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Tony’s Chocolonely

The example of Tony’s Chocolonely shows how the company actively encourages
other chocolate companies to adopt their methods through Tony’s Open Chain
platform. This is an open source platform that collects all relevant information and
tools that companies can use to ensure their supply chains are 100% free of slavery
and enable cocoa farmers to earn a livable income. This is achieved by increasing
traceability in the supply chain, based on Tony’s own “Five Sourcing Principles”
model.

With chocolate brand Delicata, supermarket chain Albert Heijn was the first to join
Tony's Open Chain. By cooperating with Tony's Chocolonely, they contribute to a
positive development of the sector.

Tony’s Chocolonely started as a small social enterprise that sources cacao

to ensure farmers a ‘living wage’ and has now expanded to a fast-growing
international company, whose sourcing principles have been followed by
the largest Dutch supermarket chain.
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5 Sourcing Principles | Tony's Open Chain (tonysopenchain.com)

Tony’s Open Chain consists of 5 Sourcing Principles. They need to be implemented all five. No
cherry-picking. In a system, you cannot change only one thing. A change always triggers something
else. These 5 Sourcing Principles interact with each other to strengthen the positive impact, but also to
counteract possible, negative side-effects. An integrated approach is needed, geared to structurally
change the system. Every principle has its own tools.
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Recent reports show that productivity increase programmes do not have an inherent positive effect
on the net income of cocoa farming households (Waarts/Kiewisch 2021, IDH 2021, Dalberg 2018).
On its own, increased productivity cannot be the strategy to bridging the living income gap, for
several reasons. Firstly, it requires significant investments in inputs and labour resources, which are
neither available nor affordable for most cocoa farmers. Even if they were, investing in the farm
comes with significant risks, especially compared to the possible return on investment; farm gate
prices could decline steeply (as they did in 2016/2017), extreme weather conditions can cause bad
harvests, as can pests and diseases (such as the Cocoa Swollen Shoot Virus which is spreading in
Ghana). Secondly, increasing productivity requires an increase in labour hours. Even with current
production levels, many cocoa farmers in major producing countries find it difficult to find enough
labour for their farms during peak times. Every cocoa growing household has a finite amount of
available labour days to spend on cocoa; a household in Ghana has 246 available labour days, in Côte
d’Ivoire 272. If more labour than this is necessary, this will require hiring additional labour, if it is
available in the first place. This is – not coincidentally – also one of the reasons why families revert to
household members to help with the farming, increasing the risk of child labour. If only 10% of all
farmers would double productivity and by this fulfil the requirements of many companies, the
ensuing oversupply would cause prices to fall drastically. Any productivity increase drive must be
coupled with equally strong measures to curb overproduction
1. Using an appropriate business management theory, describe a human need that

Tony meets by using its supply chains that are 100% free of slavery and enable

cocoa farmers to earn a liveable income. (2 Marks)

2. Explain two possible challenges facing Tony’s Chocolonely. (6 Marks)

3. Using all the resources provided and your knowledge of business management,

recommend a possible plan of action to ensure the sustainability of Tony for the next

5 years. (17 Marks)