You were doing well before the pandemic hit then BAM! You’re struggling to stay afloat. You’ve laid off staff and the only option you had was to take out a loan and another loan. Fast forward to several months and you’re still in debt… Oh no! Joining me now to discuss her experience, we have CEO of Chocolate Dreams, Michelle Smith.

Debt should be last resort for entrepreneurs

By Kalilah Reynolds Media 

CEO of Chocolate Dreams, Michelle Smith said debt should be a last resort for entrepreneurs in Jamaica, especially as the country continues to grapple with the pandemic.

Speaking with Kalilah Reynolds, the CEO said in her experience as a business owner, debt has never worked and has been expensive and time consuming.

“You have to jump through so many hoops to get debt financing here. I know DBJ [Development Bank of Jamaica] has it’s SERVE programme now but you still have to go through an FI [financial institution], you still have to jump hoops and climb walls; it’s just not easy,” she said.

Smith said her experience with debt financing in the past was also challenged by the relationship she had with her lending partner. It’s for this reason, she’s cautioning other entrepreneurs who are seeking assistance to ensure their business goals are properly understood before entering agreements.

She’s also calling on financial institutions to be ‘puller uppers’ and be more involved in the operations of the businesses they choose to lend to. 

I don’t think the financial institution knew about my business. They didn’t take an interest in it. It was like let’s give her the financing but there was nothing behind it and you can’t work that way,” she argued.

“If you [the financial institution] have a business manager, how can the business manager not visit your company? That doesn’t make any sense, you have to appreciate what people are going through, what they do and how they live,” she added. 

Smith explained that she has been able to keep Chocolate Dreams afloat during the pandemic without debt financing, by capitalizing on the baking segment of the business that has been working. The company had lost 60% of its revenue when five hotels that it supplied closed last year due to the pandemic. 

She said the business has had to pivot online and use social media more to engage customers.They also relocated their factory and retail arm to a more accessible location on East Kings House Road.

Smith said while COVID-19 restrictions, including curfews and lockdowns have had a negative toll on the company, income has been stable over the last eight months with the quality of products uncompromised.

She’s credited the work of her small staff for keeping the company above water.

“The pandemic has taught me a lot. It showed me what I can do and what I can’t do. For instance buying stock big or small as you need it; I don’t have a big stock room anymore so I buy as I need it and it works really well,” she said. 

The Chocolate Dreams CEO said a more aggressive approach will be taken towards the export market come 2022, with a pilot already underway with Amazon.

She said she also stands ready to list the company on the Jamaica Stock Exchange (JSE) with the help of financial advisers. 

“I think listing is the way to go, and it should be every entrepreneur’s channel out; that’s a great way,” she said, and added that she believes investors would be eager to buy her company’s stock whenever they should announce an initial public offer (IPO). 

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