It's Not About Being A Businessman - It's About Being A Business
It’s time for those in speciality coffee to accept that they are in business and through being good at business they will be able to deliver the greatest impact to the supply chain they are so passionate about.
Coffee is full of passionate, idealistic and creative individuals. These people are what make our industry tick and such a joy to be part of. However, without robust, sound and commercial business practices, it will never transcend being a passion-led pursuit. This is the biggest threat to the success and the industry’s ability to deliver real change whilst we trade.
If we can collectively raise the bar of speciality coffee in terms of the offering, accessibility, understanding and engagement of the broader consumer our businesses will be able to deliver the value we seek to those that produce the raw product we love.
A chain is only as strong as its weakest link
It is only from our individual position of sustainability that we can collectively bring sustainability to the whole supply chain, and indeed speciality coffee as an industry. Lest we forget: A chain is only as strong as its weakest link.
It is the responsibility, therefore, of each business in the supply chain to make itself sustainable. To do that, each business needs to be well run and make a profit, even if it then choses to invest those profits back into those at the bottom of the supply chain (i.e. the farmers).
Therefore, to succeed we must hold ourselves to account to the same basic business principles of any other business or market sector, and we must achieve the following:
- Deliver to the customer a product they want and can understand.
- Provide that product at a profitable margin – i.e. sell it for more than it costs you to make it.
- Run your business within its means. Debt or losses should only be accepted if planned and with a clear path to profit making.
- Do not treat cash or investment as a renewable resource. The basic principle of business is to generate value, financial value being the bedrock of its success, as without it your business will not survive long-term.
If you cannot sign up to these principles, that’s okay. But you must then acknowledge that you are either a charity or a not-for-profit organisation by doing so.* Both of these types of ventures are commendable, but should not be confused with business.
*As funny or controversial as it may seem, this would be a great chance to get up to speed on the great tax breaks for these endeavours
If the first step to change needs to be our focus on our businesses, the second is to focus on how we engage with customers. It’s time to make a stark choice.
- Reduce the ‘specialty’ aspect of our coffee, shifting our businesses to being mass producers and providers of a lower-grade, but more profitable product that (sadly) resonates with the commodity drinker
- Hold our nerve - and quality of our coffee - and improve our customer engagement
If we choose the latter, we must stop talking to each other and competing to see who can become the most speciality of speciality. This doesn’t mean we stop innovating or trying to push the boundaries of speciality. It just means we apportion an appropriate amount of time and resources to such endeavours – don’t invest what you can’t afford to lose. This will give us the time to shift our everyday attention to offerings that will appeal to a broader consumer group by creating offerings which put the value perspective of the consumer first. If we get this right, we will gain greater market share together whilst still sleeping soundly at night, safe in the knowledge these consumers are now experiencing better coffee. This will enable us to collectively deliver speciality coffee at scale, rather than allowing the commodity coffee providers to milk us of our innovation, language and owning scale.
Why is it time for everyone in the business of speciality coffee to be successful businesses and broaden their appeal to new customers? Because in competitive markets this is historically an unavoidable survival-of-the-fittest situation, or at the very least a fight to make speciality coffee deliver on its promise of real impact to its fragile supply chain.
It’s Not About Being A Businessman – It’s About Being A Business
Every day our industry is faced with many challenges: Environmental / climate change impacts our raw producers, global markets & currency fluctuations have significant implications on our businesses, key workers in our retail sector such as baristas are not remunerated at a level commensurate with the level of expertise and skill they have painstakingly acquired, making attracting and retaining talent relentless. It is our responsibility not to let poor business acumen or consumer acquisition be added to the multitude of challenges we share as an industry.
If we don’t actively safeguard our very industry to our best abilities, it will remain a nascent industry whilst the commodity producers - who cannot and will not make the positive impact to the supply chain that we can - will continue to dominate.
Being successful in business does not make you a capitalist sell-out nor does it compromise your independent credentials. Being successful in business gives you the breathing room and strength you need to be a true contributor to the robustness of a real Speciality Coffee Supply Chain that can deliver great value to every one of its continuants.