Skip to main content

! Man"s Journey


So 1994 was good, we made money and that was the goal, I guess. but something was missing. I started buying futures and options to cover us, in an ever changing market. it was no longer just speculator's, dentists and doctor's, it was the real deal it was guys and girls in 'fidelity and Morgan Stanley that found commodities can make you a lot of money if you were willing to speculate. Think about it as someone that doesn't give a crap about your business and really doesn't know anything about it but just wants to make money on the crop estimate to the weather. So we are in a business that buys the physical product but have no control of the pricing. That is a settling feeling right? NOOOOO.
But that is when it changed, and I went to the owner and said we have to be in the game if we fixed coffee at $1.35 and the market goes to $1.15 we are in trouble. It will directly effect our gross margin. So I developed a system to not capture all the market swings but to take advantage of the market swings and capture some of the movement through paper transactions.
It was hard to explain to a guy who bought coffee at $1.20per lb and priced it at 3.20??? It became a joust and an education that if we bought physical coffee at $1.15 and the market goes to $1.35, we have position at $1.15 and we capture the paper profits at $1.35 and effectively negating the increase by realizing a paper profit of .20c per lb and selling the coffee at hopefully a little higher price because the market went up. it was ground breaking stuff, and I had it all down to a real system we couldn't lose but when you are dealing with fixed costs and gross margins it is a tough sell.






Popular posts from this blog

How To Roast Your Own Coffee At Home!

How To Roast Your Own Coffee At Home!How to roast your own coffee at home! This is a question I have been asked by many people, especially lately. I haven't been actively updating the blog lately because this is one area of my return to the coffee business that I have really been working on.
First of all, coming from a commercial coffee roasting plant, with over 25 years of experience, this question was one I really had to think about. I was thinking, is it even possible to roast a quality cup of coffee at home and secondly, is it worth your time, effort and expense?
Well the answer is a resounding, ABSOLUTELY! Now, with Black Friday right around the corner, I thought this would be a fantastic time to talk a little about the process, the equipment required and some of the nuances you must eventually master to experience the Freshest cup of coffee you will EVER drink!
Now for me, I was lucky enough to pick whatever coffee or blend from my plant on a daily basis, throw a pound in my 1…

Has The Coffee Roasting Business In The U.S. Taken Its Last J.A.B.?#coffee#coffeebusinessnews

Has The Coffee Roasting Business In The U.S. Taken Its Last J.A.B.?
Unless you have been hiding in an unmarked oil well over the past few months, you already must have realized there has been a significant change in the coffee roasting industry. The $40 billion U.S. market has another bully on the block and watch out Nestle, these gentleman are playing for all the marbles.#entrepreneurship

Coffee beans, which is the second largest traded commodity in the world is apparently a target of one of the richest families in Europe. The Reimann family has not so quietly, been actively targeting U.S roasters and using a “price is not an issue" formula!



The cash is there, and they are clearly not afraid to be buying based on future earnings projections. This isn't a strange occurrence for J.A.B., they purchased D.E. Master Blenders, Douwe Egbert for a cool $10 billion. Many analysts refer to this transaction as, "a pure play coffee company".

Their coffee portfolio no…

The Future of The Coffee Roasting Business In The U.S.#coffeefacts#businessopinions#entrepreneurs

The Future Of The Coffee Business in The U.S.

So where do you think the coffee business is going in the U.S.? As I have written in previous posts, there has been major consolidation within this industry over the past few years. Long overdue by any industry standard.

Let's take a look at the factors, roadblocks, and issues this business has, moving forward in the U.S. marketplace. It is far from unique as many industries are in the same boat. But where is the next big breakthrough? Will there be another Keurig? Well no one has a crystal ball, but there are things happening, and most of them, like the 1 cup k cup machines are not on a lot of people's radar yet. But, for someone like me, who has spent more than half of their lives in this industry, I have to believe that will come along.

Again, that next big thing in my mind is still only half the equation! Consolidation of this industry is still in the really early stages, as far as I'm concerned. But, as I sit here an…