Dunedin edged closer to having a new chocolate factory after managing to secure a facility which will house chocolate production, a chocolate factory tour, and a cafe in the Steamer Basin building.

The plan for the factory began when Cadbury's parent company Mondelez announced it was closing Dunedin's Cadbury factory last year, resulting in the loss of about 300 jobs.

At the time, Dunedin city councillor Jim O'Malley and a team of volunteers launched an 'Own the Factory' campaign, with the aim of purchasing the business and keeping chocolate production in Dunedin.

This has since evolved with Otago Chocolate Company (OCHO) coming on board.

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A PledgeMe campaign last year saw $2 million raised in less than 48 hours from around 3,500 shareholders across the country.

OCHO founder and now general manager Liz Rowe, who sold the company to the wider group, said the funding would allow OCHO to expand its production, providing jobs for some of the chocolate makers as well as keeping chocolate production in Dunedin.

"Jim and the group started looking at how to keep the Cadbury jobs and chocolate making in Dunedin by buying the Cadbury factory.

"It seemed clear to him after a wee bit that that wasn't going to work out," Rowe said.

"Our focus this year is to get the new chocolate factory up and running. Once we have achieved this we will start working on plans to operate chocolate tours and then look at opening a café on the site.

"The wonderful thing about this building is that it allows us to manage our expansion in stages."

Rowe said the new business would provide between 10 and 20 jobs initially, with more roles opening up as expansion continued.

Dunedin considers itself the home of chocolate making in New Zealand so it's great we can do this," she said.

The OCHO team, (left to right) Stewart Cowan, Vito Iannece, Anna McDonald, Tami Louisson, Liz Rowe, Rachel Elder, Nicola McConnell, Jim O'Malley
The OCHO team, (left to right) Stewart Cowan, Vito Iannece, Anna McDonald, Tami Louisson, Liz Rowe, Rachel Elder, Nicola McConnell, Jim O'Malley

The money was being invested in new equipment, new beans and fitting out the new building which would allow OCHO to ramp up production from 90 kilos of craft chocolate a week to 200 kilos a day.

The new equipment from Italy is scheduled to arrive mid-way through this year.

The Steamer Basin was an ideal location for the tourism venture Rowe said.

Meanwhile, Mondelez International is investing $7 million in redeveloping and growing Cadbury World in Dunedin.

Following the decision by Mondelez to close manufacturing operations and chocolate production, the company has committed to maintaining its presence in New Zealand with the redevelopment, as well as continuing the annual Cadbury Carnival.

Mondelez country head James Kane earlier said the decision to close manufacturing in Dunedin had been a difficult one but investment in Cadbury World would ensure it remained a part of Dunedin's tourism sector.