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Coffee Manufacturing- One Man's Journey

So here we are I am 4 years into my life in the coffee industry. Now things are changing rapidly. Our company is not built to be efficient. We lived in a building that had four floors(the ideal plant is one floor), you know the raw materials go in one door and the finished product goes out the other door. This is the time when consumer's were starting to really look at the stuff they were buying also. I started hearing from people, "you know what, I used to drink a pot of coffee a day, but now I am down to one cup, so it better be GOOD". Well that is kind of the start of a revolution. One guy called me up out of the blue and he claimed he had the most revolutionary product, and was determined to change the coffee industry and the way people drank coffee. The first thing I did was chuckle, not because of the premise or his demeanor. It was just I had by then had over 50 people sit in my office and say, "I am going national with this idea, my path is I am going to open 500 coffee shops in 18 months, blah, blah, blah. Well I can tell you not one of them even came close. Well there was one idea started by two guys that was in 1991 or 92, which then was a pretty great idea, it was to put up these, Double Drive thru Kiosks. Made sense to me, if you have the traffic, and it is all about location, location, location, then it was a brilliant idea. The only problem was, one guy was working in a deli department at a local supermarket chain and the other guy, was the "creative" one. So here I am talking to these two guys with a great idea, but there was just one thing. They had no idea about business, and capital, and business plans or even trying to seek out investor's. How frustrating! I offered to help them financially through the company, but they decided I was trying to steal their business model. This really scared me, because they never even mentioned retaining an attorney and retaining their intellectual property or covering themselves in any way. Well, two years later, Chock full O' Nuts came along, sold them a bill of goods of how they were going to sell franchises based on their concept and forever take care of them. So they signed the deal, thinking they'd both have jobs and within two years, they were both gone and Chock sold the existing locations to Dunkin Donut's. What a crime!

Anyway, getting back to the other guy with the idea. I sat on it for about two weeks. Then one night I was sitting there thinking, Oh what the hell, let's at least hear the pitch. What's the worst thing that can happen, I waste 45 minutes to an hour of my day. So in comes this kind of quirky guy, that was carrying a "prototype" model, maybe not even that, a sort of conceptual machine, that brews coffee one cup at a time. The great thing was every cup could be different! You could have a breakfast blend and your wife could have a french roast! I am sitting there astonished, because this guy wasn't a coffee guy at all he was an inventor! So I am pretty astonished by this guys concept. I mean, to me it was the best idea since A&P put grinders in the aisle to transform fresh roasted whole bean coffee into fresh ground coffee. Which turned into Eight O' Clock coffee and TATA beverages, who also owns Tetley tea among a few other national brands. The only thing was the idea was so raw, there was plenty of R&D to be done to successfully bring it to market. So during our meeting I ask this gentleman, why are you pitching this idea to us? His answer almost made me fall out of my chair. He said, "well I was looking in the yellow pages, and your company was the first one that caught my eye". WHAT?

I will say he had a plan, was looking for funding and knew his product had to be manufactured. The only thing was it was still in its infancy stage. When I mean infancy, I am talking about maybe a three month old baby, and you really don't know what you have yet. I fell in love with the idea. Brilliant I thought. The only thing was, you had to kind of create a prototype packaging machine that could produce the product without defects and the product wasn't really completely finalized. I looked into the cost associated with something like this for 3 months. I found a company who could build such a production machine, and the cost would be $400,000 approximately. They thought I was crazy even asking about this. Anyway, I did my homework, presented the proposal to the owner of my company, with my strong recommendation that we do this, and he basically shot it down in ten minutes! He thought I was a gambler and absolutely out of my mind. I will never forget him saying to me, "kid, you have a lot of potential, but you really need to grasp the risk reward thing, it will come with experience, you will see". Well that product became K Cups, which is now everywhere you look! They are selling the machines and multiple products in Supermarkets, for crying out loud! Just look at Green Mountain Coffee and their public stock price! You know why they are so successful? Because they partnered and spent the capital to produce the product. The downside of this whole thing is the inventor of this revolutionary product, because of panic, financial difficulty or whatever, isn't even involved in it. Some VC company bought the whole thing for some ridiculous  amount like $50k from him. Now he is over in Newton, Mass, trying to build something to do with lights that will revolutionize the electrical industry. Unreal but true. That's all for now but more to come. I hope you are enjoying the journey it gets crazier and crazier from here on out, but really the truth. As always, peace to everyone, kiss and hug the people you love daily, and always give thanks, that we live in the greatest country on earth! I am out of here for now! Joe

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