One Man's Journey in The Coffee Industry and Life

Hi everyone, It has been awhile! I have been enjoying this great New England summer weather with my wife, and in fact, just spent a few days on Cape Cod with some of our dearest friends. Wow, maybe I should have titled this article Three things.... because spending time with good friends should always be on the agenda, but that doesn't need to be a skill you have to acquire, so I digress.. Ok. When I bought my business I was 37 years old. I was full of ideas, motivated like a lion who hadn't eaten in ten days, and enthralled in my opportunity to really be in charge for the first time in my life. Think about that for a long minute. That is, in itself a lot to be processing. This is why owning your own business isn't easy, unless you are a one person operation! Which I am now, being an active consultant, but on my own. But back in 1997, I had departments to manage, 65 employees to pay, and 104,000 square foot building to maintain! Oh yeah, and I had to sell a little bit

If you have been in this business long enough, you understand the daily challenges you face as a small business in the coffee roasting industry. You don't have to tell me I've been there, done that. As I have stated before in this blog, I am an active consultant and am always seeking opportunities to help your business become more profitable, keeping your overhead low and stay in the game, protect you customer base and become a leader in your niche! I will always be available to do that, and if you choose that path, I certainly hope you contact me, because I guarantee you I can help! As I look at this industry as a whole though, it makes a whole lot of sense to consolidate. I live in the New England area and recently did an analysis for a company about how much fragmentation there is in just this one small area of this country. There are over 40 small to medium sized privately held roasters in a 300 square mile area, and what most are doing is banging each other over each ot

If you are an active roaster in the coffee business the single toughest thing to maintain profitability is to maintain or increase your Gross Margin. Coffee is a commodity and as such the biggest challenge is to keep that gross margin level or drive your costs lower within that category on your P&L! So what is your long term strategy to do this? Do you have one? Most people I have talked to just basically say, well when the coffee market goes up, we just increase our prices. Ok I get that, but that is risky business in itself because your competitor's maybe bought coffee at a lower price or their purchasing philosophy maybe much more in-depth and complicated than your own, leaving you at a very real disadvantage along with leaving yourself open to losing customers based on pricing! Which always drove me crazy. Do you realize that if a coffee shop owner raises their price 5 cents per cup, it more than covers a price increase per pound of $2.50! I have been in this business for