Armenian chocolate could become the country's calling card: One of Eurasia's largest confectionery factories is preparing to launch in Yerevan

As early as September, the first products from a new Armenian chocolate production facility — which its creators call one of the largest confectionery factories in Eurasia — are expected to hit the market. The total investment in the project amounts to approximately €125–130 million, and after the enterprise is fully operational, investments could reach €150 million. The company aims to create up to 2,500 jobs, export products to EAEU countries, the Middle East, Europe, and North America, and, in the long term, make Armenian chocolate one of the country's symbols.

Economix interviewed the director of the Wellar group, Arshavir Minasaryan, about the project, its scale, plans, and challenges.

From childhood dream to largest project

The company was founded in 2021. According to Arshavir Minasaryan, the shareholders' original idea was to build a large-scale chocolate and confectionery production facility in Armenia, aimed not only at the domestic market but also at a much broader geography.

He admits that the decision to invest specifically in Armenia was largely emotional.

"For many Armenian entrepreneurs, investing in Armenia may not look entirely rational from a pure business logic standpoint. But there is an emotional connection to the homeland and a desire to create something for one's own country," he says.

At the same time, there were also pragmatic reasons. These include Armenia's membership in the EAEU, market changes after 2022, and government investment support programs.

According to Minasaryan, the departure of several major players from the market and the difficulties faced by chocolate producers in EAEU countries have created new opportunities for the emergence of large-scale new production facilities.

Factory costing over €150 million

Construction of the facility is nearly complete. Current work mainly involves the installation of production lines, over 80% of which have already been set up.

Equipment has been purchased from leading European manufacturers in Denmark, Germany, France, Italy, and other European countries.

"What you see at our factory is the Rolls-Royce and Maybach of the chocolate industry. We have acquired the best production lines available on the market," the plant director notes.

The total investment made to date is €125–130 million. Fully launching all production capacities will require an additional €25 million.

The first commercial products are expected to appear on the market in early September.

The full launch of the facility will take place in stages. The company has developed four phases of development, and every six to eight months, new lines and new product types are planned to be introduced.

Exports as the business's foundation

The company does not hide that the factory is not being built for the Armenian market.

"We are too large to work only for the Armenian market. The majority of our output will be exported," says Minasaryan.

The first key market will be the EAEU. According to the company's estimates, the chocolate market in the union is approximately $650–700 million.

The second direction will be the Middle East, which, despite having a smaller population, represents a market of about $1.2 billion.

The third stage will be entry into the European Union market. Competition there will be significantly higher due to the presence of long-established brands, but the company is confident it can carve out its niche thanks to product quality.

"We will operate in the mid-range and premium segments. Our chocolate must be associated with high quality," the director emphasizes.

In the longer term, the company intends to enter the US and Canadian markets.

Moreover, foreign partners are already showing interest in the future products.

According to Minasaryan, even before production began, the company received collaboration offers both from networks and entrepreneurs in EAEU countries and from partners in the European Union.

From Ghana to Armenia: how the supply chain will be built

The key raw material for production will be cocoa.

According to the plant director, the chocolate industry has only a few major global suppliers that purchase cocoa from farmers in Africa, South America, and Asia and then sell processed raw materials to chocolate manufacturers.

At the first stage, Velar will cooperate with precisely such international companies.

However, the enterprise intends to move toward direct interaction with cocoa producers in the future.

Minasaryan said he recently visited Ghana — one of the world's largest cocoa producers, accounting for about 30–35% of the global market.

"We want to build a company that will control the entire supply chain — from raw material procurement to our product appearing on store shelves," he noted.

At the same time, the enterprise intends to actively use Armenian raw materials as well.

The group of companies includes dried fruit producers, and it plans to purchase packaging from Armenian companies and cooperate with local logistics operators and service providers.

Up to 2,500 jobs and its own chocolate school

Currently, about 110–120 employees work at the enterprise. After full launch, the factory expects to employ more than 2,000 people.

"By Armenian standards, that's the population of an entire village," says Minasaryan.

To train personnel, the company cooperates with universities, including the Armenian National Agrarian University, participates in thesis defenses, and selects promising students.

Additionally, employees are sent for training to leading global industry experts.

A special place is occupied by the creation of the company's own research and development center.

According to the director, the company is building a chocolate and confectionery product development center unique to the region, equipped with scaled-down copies of production lines. Here, not only new products will be developed, but also industry specialists will be trained.

"Every product we bring to market must be special. To export Armenian chocolate, you need to stand out from competitors," Minasaryan believes.

Main difficulties — not equipment, but infrastructure

According to the director, the most challenging part of the project was not the procurement of production lines.

The main difficulties were related to creating infrastructure.

Operating the facility required the construction of complex electricity, water, gas, and steam generation systems.

Several electrical substations, four boiler houses, and a large steam generation complex have been built on the factory grounds.

"What turned out to be the hardest was precisely the infrastructure creation. Installing production lines is easier than building an entire engineering system of this scale," he says.

The main lesson Minasaryan has drawn from implementing the project is the need for extremely detailed planning and scenario preparation for any risks.

What the business expects from the state

The company already benefits from government support programs, in particular the infrastructure cost reimbursement program.

Additionally, discussions continue regarding mechanisms related to customs duties and VAT for imported raw materials that are subsequently used to produce export goods.

Another important issue remains logistics.

According to the director, once at full capacity, the enterprise will produce about 200–220 tons of chocolate and confectionery products daily, equivalent to roughly 10–15 trucks per day.

Under these conditions, stable and alternative logistics routes become critically important for the business.

The company places particular hope on the possible opening of the Armenian-Turkish border, which would reduce the cost of raw material imports and facilitate exports to European and Middle Eastern markets.

"Armenian chocolate will be associated with quality"

Despite existing challenges, the company is confident that the Armenian chocolate industry has a bright future.

According to Minasaryan, a serious base of producers already exists in Armenia, and total investment in the industry after the new factory's launch will exceed €300 million.

He believes the multiplier effect on the economy will be significant: the number of jobs will grow, and demand for services, logistics, packaging, and agricultural products will increase.

"In five years, Armenian chocolate and all related confectionery products should be associated with quality. If someone in Canada, the United States, or Russia wants to try high-quality chocolate, they should think of Armenian chocolate," says the plant director.

In his opinion, the market itself should set quality standards, and the competitiveness of Armenian producers will depend primarily on their ability to create truly unique and high-quality products.

"I am convinced that Armenian chocolate can become one of the country's calling cards — just as chocolate has become a symbol of Switzerland or Belgium," concludes Minasaryan.