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Cocoa & Butter closing its doors months after opening on University Avenue

Uploaded: Nov 18, 2022

The display case filled with baked goods and sweets at Cocoa & Butter in Palo Alto. Courtesy Rafae Bhatti.


By Kate Bradshaw

Cocoa & Butter, a French bakery and patisserie that opened a brick-and-mortar location in downtown Palo Alto seven months ago, announced Nov. 16 that it has closed the shop, offering its goods only through online orders.

There are a number of factors that led husband-and-wife team Fouzia Rafae and Rafae Bhatti to suspend retail operations, including major workforce challenges, a rent increase and a rapidly changing economic climate, Bhatti says.

Before opening the shop at 383 University Ave., Cocoa & Butter had operated as an online business for about six years through a cottage kitchen license, renting out commercial kitchens to bake for larger events. That's the setup they plan to return to after deciding to close down their storefront, Bhatti says.

The couple turned to crowdfunding to support launching their bakery, a family business funded primarily by personal savings, they said.

"We were hoping for a rebound that never arrived," Bhatti says.

One of the biggest challenges the bakery faced was with hiring and retaining workers, Bhatti explains. Offering higher-than-market pay, along with medical and dental health care benefits and 401K options, wasn't enough to attract workers with the experience they wanted. So they took on workers who were less experienced and needed training. After going through the training, many left for higher-paying jobs after receiving their first pay stub from the bakery, he says.

Over the course of their seven months in operation, they were searching for new workers every two or three weeks and cycled through 30 to 40 employees, he says.

These staffing problems have been compounded by recent layoffs hitting the tech sector.

"At least in the pandemic, the tech sector retained its strength," he says. "Now that part has reversed as well…the sector is losing jobs and spending is going to go down."

Meanwhile, their efforts to negotiate with the landlord regarding a rent increase weren't successful.

"We just could not continue to accumulate all those losses, particularly with the forecast not looking bright either," he says.

But despite the obstacles, they're not giving up on their bakery concept.

"We enjoyed serving the community," he says. "??Hopefully we'll be able to find another opportunity for retail, but for now, I think we'll just have to wait it out a little bit."

Cocoa & Butter, 383 University Ave., Palo Alto; Instagram: @cocoaandbutter_.







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Posted by toransu, a resident of Barron Park,
on Nov 21, 2022 at 6:01 pm

toransu is a registered user.

30-40 employee turnover in seven months, and them leaving the minute they got their first pay stub? Something tells me it goes beyond them just finding better pay elsewhere.


Posted by ndn, a resident of Downtown North,
on Nov 25, 2022 at 9:38 am

ndn is a registered user.

I'm not surprised at all.I went there once to buy a very large number goodies as gifts for a breakfast(almost $200.00). Some of the goodies were packaged by them in boxes some just paper bags. I asked if they had any bags and they answered "Well, we've already given you some boxes, so..." with some disdain and showing me the bags they wouldn't part with... I piled up the boxes in my arms with the paper bags on the top and got back to the car. Passing by the Venezia caffe' their piled paper bags were starting to slide and threatening to fall when an employee of the caffe' swiftly came to rescue and got me to my car(parked almost in front) with my goodies intact. While I was getting everything in place in the car I told him to wait to give him a little tip but he just said "my pleasure" and resumed his duties at the caffe'.
Caffe' Venezia is successful. They train their employees well.
It's not just the goodies (theirs were fantastic )it's the attitude. I never went back to Cocoa & Butter.


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