Hotel Chocolat boss on starting out, 'Slabgate' and making up with Waitrose

There’s no doubting Angus Thirlwell’s foodie credentials. Sitting at his Rabot 1745 restaurant in Borough Market, the Hotel Chocolat CEO orders perhaps the most on-trend brew on the menu: an oat milk macchiato. He doesn’t grumble when a dairy version comes by accident either, instead comparing it with its replacement as a “taste test”. In fact his eyes light up when talking about his love of food. Whether sampling the rare breed of beef at his local Italian in Primrose Hill, or trying out Hotel Chocolat’s “divisive” matcha hot chocolate, he’s passionate about his subject matter. “People laugh at how interested I am in the minutiae,” he admits. And no, there is no such thing as a night off. “You can’t help take the knowledge you’ve built and apply it when you go out socially but I try not to ruin the evening for everyone,” he laughs.

This obvious passion makes it hard to believe Thirlwell was a relative latecomer to the world of food. Entrepreneurialism is in his blood (his father founded the Mr Whippy ice cream brand) and it was this love of business, rather than of chocolate, that first inspired his career choice. “When I was growing up, I used to run a film society and my friend and I made so much money out of it we had to go and sort of launder the money in the local town to get rid of all the 50p pieces,” he says. “I have always been fascinated by the idea of building things and making them work.”

This desire for his own business led Thirlwell to co-found the Mint Marketing Company in the 1980s - selling B2B branded mints. “The first couple of years were great. But by year three customers were saying, ‘Do you have anything else?’” So he and his Hotel Chocolat co-founder Peter Harris were “slightly reluctantly dragged” into the business of chocolate.

That reluctance soon wore off, once they realised consumer appetite for the stuff. “There’s no stronger word in the food universe than chocolate,” Thirlwell enthuses. “It’s a word that excites people more than anything, sort of slightly crazily, and I hadn’t realised until I was dragged into it. As soon as I was immersed in it, I thought ‘this is way better than peppermints’.”

Thirlwell is visibly animated when describing the difference between his “high-quality, high-cocoa” chocolate (a minimum 36% cocoa content) and what he brands “sugar-laden brown stuff”.

This passion for high-quality chocolate was a major factor behind his very public spat with Waitrose over its ‘copycat’ slabs in May. At the time, Thirlwell could barely contain his rage as he slammed “sugar-laden imitations” that were a “throwback to 1970s UK chocolate”. Now Waitrose has voluntarily removed the offending slabs from sale - without a high-profile legal battle - the tone is far more conciliatory.

“I reached out to the chief exec [Rob Collins] and said let’s have a cocoa together and make sure it doesn’t happen again. We’re on good terms now. It was a clearing of the air and you can’t wish for a better solution than that,” he says. (And yes, Hotel Chocolat has retained its listings in John Lewis stores.) “I must say we got a number of warm comments on social media from people saying: ‘Wow, well done! Waitrose and Hotel Chocolat should be doing the Brexit negotiations for us.’”

Saying that, he wouldn’t hesitate to take a similarly combative stance if the same situation arose again. An Aldi copycat slab would be Thirlwell’s worst nightmare and he wouldn’t shy away from legal action if necessary. “Fair competition is fair competition, stealing is stealing and basically that crosses the line in most people’s books,” he says. The CEO supports brands such as Heck in protecting their intellectual property too. “I think it’s fantastic Heck is taking them [Aldi] on,” he says. “One thing British brands are very good at is creativity, and that doesn’t come by accident. That comes from employing designers, food scientists, research and development people and it’s expensive. That will stop if it can’t be protected.”

Supermarkets? No thanks

Arguably one way Hotel Chocolat could pre-empt any imitations is by going into the major supermarkets (its lines are currently only available at Ocado). Thirlwell admits he is approached “all the time”. But we’re not likely to find his slabs at Tesco any time soon. “We can’t think of anything worse than being wedged next to the baked beans,” he says. “We don’t want to risk our brand being commoditised. So it’s meant we’ve turned off potentially lucrative channels but that comes down to long-termism. If we turned [retail channels] on, we would have stellar growth for two or three years but then the brand would be slightly tarnished.”

Thirlwell believes this focus on long-term wins has been the key to Hotel Chocolat’s success. While the overriding narrative on the high street is one of decline, Hotel Chocolat has consistently bucked the trend. Its latest annual results showed an impressive 12% year-on-year growth and Thirlwell appeared on the Sunday Times Rich List for the first time this year (he finds the whole thing “very embarrassing”).

“We can’t think of anything worse than being wedged next to the baked beans. We don’t want to risk our brand being commoditised”

He doesn’t buy into the argument that high street retailers simply cannot withstand the growth of online. “Many of the people who are suffering are doing so for reasons that were self-inflicted: not adapting, being in denial, not taking brave enough decisions. The online element was hardly a surprise. You can draw a very predictable gradient going back five years of what proportion of household expenditure was going to go online.”

Thirlwell’s long-term strategy seems to be working. For as others are scaling back their physical presence, he’s expanding, particularly through creating new ‘café plus shop’ locations, of which there are now more than 100 in the UK (he opened 15 last year, and will add at least the same again this year). They are not only drawing in the coffee shop crowd, but delivering above-average retail sales. Thirlwell is also open to trying out places that might not seem an obvious choice for Hotel Chocolat, whose physical roots are in urban, high-footfall locations.

“We’re finding loads of places our customers want us to be, for example Carlisle and places like that, which I could have never imagined would have worked for us. It’s something we’re really proud of because we never wanted our brand to be elitist. Being accessible and friendly is a key tenet of what we try to do so it was really motivating when I went to Carlisle and saw how we were being taken to heart by people in the town.”

Thirlwell isn’t just consigning his ambitions to the UK. Most recently, he has signed a deal to open franchise stores in Scandinavia, having dipped his toe into the water with a couple of Copenhagen stores that “got the results we wanted”. A launch into another “significant market” will be announced soon, though for now Thirlwell will only reveal it is “not Europe”.

With international expansion, buoyant UK sales and strong premium credentials, everything looks to be going swimmingly for Thirlwell. So he has a pretty good reason for saying he feels “optimistic”. Unless Aldi gets any wild ideas, that is.