December 2014

December 2014

www.CoffeeTalk.com Vol. XXVII No. 12

Connect. Grow. Prosper!

2015 STATE OF THE INDUSTRY

IDENTIFYING AND ADDRESSING INDUSTRY VULNERABILITIES

Welcome

C

Bill Murray, National Coffee Association Timothy J. Castle, Castle & Company, Castle Communications Amber Jechort, Primera Technology Paul Kurtz, Hemisphere Coffee Roasters Donald Schoenholt, Gillies Coffee Company Rocky Rhodes, International Coffee Consulting Group José Estorino, Javatino Jawaid Akhtar, India Coffee Board David Gross, Add A Scoop Bill Fishbein & Jake Fishbein, The Coffee Trust Don Holly, Industry Veteran Miles Small, CafeComm,Inc. Etienne Desmarais, Ecotierra

offeeTalk Media is honoured to bring you our 2015 State of the Industry in which dozens of the most influential thought leaders in the coffee, vending, and food-service related industries each address the issues of identifying and addressing vulnerabilities to our industry.

The topics addressed are wide ranging from climate change to technology, aging producer populations to marketing to millennials. Enormous thanks to our industry contributors: Rob Bethge, Perka, a First Data Company Luis F. Samper, Colombia Coffee Federation Susan Cote, Coffee Quality Institute Gender Initiative Tyler Bruno, Curtis Mike Purcell, Follett Corporation Judith W. Umlas, International Institute for Learning, Inc. Linda Smithers, Daterra Coffee Rick Peyser, Lutheran World Relief Jim Townley, Fresh Cup Roastery Café Dan Ragan, Pod Pack Int’l Alma Likic, Plitek Stefanie Makagon, Garden to Cup Organics Marty G. Curtis, Just Quantify Coffee Academy

January 2014 www.CoffeeTalk.com Vol. XXVII No. 1

We hope you find the articles thought provoking and useful!

Cheers and wishing you all an extremely successful 2015!

Kerri Goodman CoffeeTalk Media

February 2014 www.CoffeeTalk.com Vol. XXVII No. 2

ConneCt. Grow. ProsPer!

March 2014 www.CoffeeTalk.com Vol. XXVII No. 3

ConneCt. Grow. ProsPer!

April 2014 www.CoffeeTalk.com Vol. XXVII No. 4

ConneCt. Grow. ProsPer!

ConneCt. Grow. ProsPer!

See NAMA Listings page 24

The View— We have the power IF we choose to use it.

Boost Up Your Blended Beverages See Coffee Fest Listings page 24

page 10

See page 10 for instructions on how your company can be in the next Buyers Guide

This Month: 10

Cups, Lids, & Sleeves Coffee Shop Must-Haves!

20

Coffee and Weight Loss?

18

Phil Johnson: A Dramatic Display Can Pave the Way

17

The Magnificent Barista Brothers

24

Traceability What does it REALLY Mean?

18

Jack Newall Engineering Our Industry's Art Form

26

Jim Stewart Founder Seattle's Best Coffee

NAMA: A Brighter Future

Entering the Industry?

It Always Looks Easy on Paper!

18

Martin DiedrichRevolutionizing the Coffeehouse Experience

ConneCt. Grow. ProsPer!

The Essential Element

Introducing CoffeeTalk's "Virtual Roaster's Challenge"

page 10

page 10

Water

This Month: 17

August 2014 www.CoffeeTalk.com Vol. XXVII No. 8

Vol. XXVII No. 7

ConneCt. Grow. ProsPer!

See Coffee Fest Listings page 22

This Month:

This Month:

11

14

Cool Off With Iced Coffee

12

Brewing Systems

14

David Beeman - The Water Guy

MAKING A DIFFERENCE

September 2014 www.CoffeeTalk.com Vol. XXVII No. 9

October 2014 www.CoffeeTalk.com Vol. XXVII No. 10

ConneCt. Grow. ProsPer!

page 10

page 16

Listening to your ‘Inner-Roaster’Folly of a Roaster Geek

ConneCt. Grow. ProsPer!

See Coffee Fest Listings page 12

See NCA Exhibitor Listings page 23

page 8

See NAMA Listings page 14

This Month:

This Month: 10 12

Sustainability

20

Susie Spindler

14

Travis Boersma, Dutch Bros. Coffee

10

Coffee Fest's "America's Best Espresso" Challenge

16

Aroma Fingerprinting for Quality and Cost

14

Industry Icons: Rick Peyser, Life Long Industry K

Machine Cleaning Report Card: Are you Among the Failing?

18

The Luxury of Coffee is not Kopi Luwak

20

Post-Roast Dynamics and The Science of Packaging

24

Colombia The Future of Coffee

A Roaster's Secret Weapon See Coffee Fest Listings page 26

This Month:

Alton McEwen- A Man of Talent and Dedication to the Industry

20

November 2014 www.CoffeeTalk.com Vol. XXVII No. 11

ConneCt. Grow. ProsPer!

Intruiging Industry Innovations

See SCAA Exhibitor Listings page 32

This Month:

June 2014 www.CoffeeTalk.com Vol. XXVII No. 6

Packaging Makes Perfect

See NAMA Exhibitor Listings page 30

page 10

The Voice of Linda Smithers

ConneCt. Grow. ProsPer!

The Evolution of Single Serve and Industry Associations

page 8

This Month:

May 2014 www.CoffeeTalk.com Vol. XXVII No. 5

14

The Single Cup Revolution

12

20

page 10

See NCA Exhibitor Listings page 24

Cup of Excellence Winner Sets Record

Contents

16 18 20 22 24 26 28 30 32 34 36 38 40

4 Ways Mobile Can Future-Proof Your Coffee Business Rob Bethge, Perka, a First Data Company

Cooperative Programs

Facing Challenges Together with Research and Innovation

Luis F. Samper, Colombian Coffee Federation, Inc.

Gender Equity in Coffee

Challenges and Opportunities Susan Cote, CQI- Coffee Quality Institute

Consistency in a Growing Industry Tyler Bruno, Curtis

August Afternoon Seeks Cool Operators Mike Purcell, Follett Corporation

Go Grateful

For Emloyees and Customers

Judith W. Umlas, International Institute for Learning, Inc.

Branding for the Future Linda Smithers, Daterra

Resilient Together Rick Peyser, Lutheran World Relief

The Price of Emission Jim Townley, Fresh Cup Roastery Cafe

Office Coffee Service in Transition Dan Ragan, Pod Pack International, Ltd

Keeping up with Industry Demands A One-Way Street

Alma Likic, Plitek, Llc

Tea Sales on the Rise Infusing Your Business

Stefanie Makagon, Garden to Cup Organics LTD

Is Our Current System Sustainable?

Addressing Vulnerabilities to Our Industry Marty G. Curtis, Just Quantify Coffee Academy

Rudolph with your nose so bright...

Wishing you a happy and safe holiday season.

The safer, more spill resistant lid Call us today at (855) 468-8883 or visit uVuLids.com

Contents

42 44 46 48 50 52 54

56 58 60 62 64 66

Meeting the Challenges Ahead New Jumps From Solid Ground

Bill Murray, National Coffee Association Of USA (NCA)

Where Are We Now?

Preserving Specialty Coffee

Timothy J. Castle, Castle & Company, Castle Communications

Customization in Coffee Industry Fosters Need for Short-Run Label Printing Amber Jechort, Primera Technology, Inc.

The Graying of Coffee Farmers

Demographic and Societal Changes Paul Kurtz, Hemisphere Coffee Roasters

Devastating Emily

Combating Coffee’s Deadliest Enemy

Donald Schoenholt, Gillies Coffee Co.

The Danger of Hype Over Quality Rocky Rhodes, International Coffee Consulting Group

Brewing Up the Bottom line Jose Estorino, Javatino

The Indian Coffee Industry

Challenges and Prospects

Jawaid Akhtar, Coffee Board of India

Three Vulnerabilities David Gross, Add A Scoop

Tiny, Little Steps Bill Fishbein, The Coffee Trust

Riding the Waves of Coffee Equality Don Holly, Industry Veteran

The Industrial Internet of Things The Rise of The Mechs

Miles Small, CafeComm, Inc.

Ignoring Climate Change and Reforestation: An Unsustainable Effort Etienne Desmarais, Ecotierra

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Publisher’s Prologue

Kerri Goodman

by Kerri Goodman, Publisher CoffeeTalk Media

W

elcome to CoffeeTalk’s 2015 State of the Industry. This year we changed things up a bit by asking our industry experts to identify potential threats and vulnerabilities our industry faces in the coming months and years. The answers were diverse and thought-provoking. As busy as we all are this time of year, I encourage each of you to read these provocative articles. Do you agree? Disagree? Is your company in danger?

Information is power and the one thing I do not understand is when people refuse to take the time to look up and around and do a bit of research. How are we to ever improve and grow without stopping to take a moment and realizing no problem is unique? Working together, sharing ideas, and reading industry trade journals, these are the solutions we all need to overcome the vast amount of threats identified in these pages.

I hope to entice you into these pages with my favorite quotes. However there was one article that stood out and I found myself adding several quotes… Thanks Tim Castle for your insights on page 44.

Where Are We Now? Preserving Specialty Coffee Timothy J. Castle, Castle & Company, Castle Communications page 44 Coffee has been identified as a potential economic lifeline for millions of people around the world.

As an industry, those of us who are in the business of selling specialty coffee need to start preparing our customers for much higher prices that could present themselves as early as the end of 2015.

The risk of alternative production is one thing, but the risk of no production at all due to farmers deciding to cash out of their properties is another concern of government officials.

8

As an industry, we need to ensure that coffee farmers continue to be motivated and have the

tools to stay the course and remain focused on producing better coffee for coffee drinkers.

Coffee drinkers, and the specialty coffee industry, will be much better off when they come to understand that there is no one “best” coffee but an increasingly better variety of exciting coffees from all over the world.

The rest are in page order…

4 Ways Mobile Can Future-Proof Your Coffee Business Rob Bethge, Perka, a First Data Company on page 16 It’s an age-old problem: how do you tempt the AM-coffee crowd back for lunch or snacks?

Cooperative Programs, Facing Challenges Together with Research and Innovation Luis F. Samper, Colombia Coffee Federation page 18 For mild arabica coffee to continue being an option for the 21st century consumer, the commonly increasing challenges that growers face also imply collective action. ... The lesson is clear: united we can do more. ... When you have a chance, please stop and smell the beans and become aware of the challenges that hundreds of thousands of coffee growers currently face and their ability to overcome them.

Gender Equity in Coffee, Challenges and Opportunities Susan Cote, Coffee Quality Institute Gender Initiative page 20 Because of the scale of our challenges, I believe we can’t afford not to focus on gender equity said David Roche, CQI’s Executive Director.

Consistency in a Growing Industry Tyler Bruno, Curtis page 22 It’s a subject mulled over the way a younger you once dreamed about being an adult— with bright, lofty expectations, but no clear idea on how we’ll all actually get there. In the still burgeoning

industry of Specialty Coffee, where agreement is not always an option, we can at least collectively and decisively share one dream. Growers, buyers, roasters, baristas, customers— we all want to have our coffees taste as good as they can be, without fail, all the time. But the make or break of our industry falls on the barista, and once those cafe doors are open, it’s game on. This requires repetition more than it does artistry, a concept that can be met with a fair amount of resistance.

Third-wave baristas are often times referred to as artisans, and artistry by its nature does not value consistency.

August Afternoon Seeks Cool Operators Mike Purcell, Follett Corporation on page 24 So why isn’t it easier to get a great tasting, personalized iced beverage? The market is there.

The hot coffee folks have proven that given convenience and choice, people will embrace their options and do what consumers do best.

Go Grateful, For Employees and Customers Judith W. Umlas, International Institute for Learning, Inc. page 26 But there is one tactic that is totally within each and every coffee industry member’s control and capability: They can proactively and successfully become conscious of, and express their gratitude in, every aspect of their work and their lives.

The Society for Human Resource Management (SHRM) said in an employee retention study that the number one reason people leave is lack of appreciation.

Branding for the Future Linda Smithers, Daterra Coffee page 28 There comes a time in every business when it is essential to consider re-branding. Re-branding is a scary proposition for established businesses… will people accept a new name, logo, or buying proposition?

Resilient Together Rick Peyser, Lutheran World Relief page 30 ...the importance of motivation, the positive continued on page 10

December 2014

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from field to table.

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Publisher’s Prologue attitude of San Jeronimo farming families, and their willingness to work together for the common good. They are a model of resilience; a model that our industry desperately needs to replicate if we are to thrive from tree to cup in an increasingly challenging environment. If we are interested in the long- term health and resilience of our industry and a consistent supply of specialty coffee, we must follow the lead of the farmers of San Jeronimo, and work and invest in our future together, which starts on the farm.

The Price of Emission Jim Townley, Fresh Cup Roastery Café page 32 Coffee bars all over North America are doing pour over coffee once again, and we can thank Mrs. Mellita Bentz for that simple little invention she created back in 1908. The way coffee bars talk about pour-over single cup brewing you would think that this was the newest thing to hit coffee culture this century. What this resurgence is doing well, is driving home the value of freshness as it translates to value in the cup. As coffee drinkers’ palates evolve, the days of roasting coffee in some plant in an industrial section of town, putting it into a box and shipping it to different points of distribution, hoping someone likes the look of your bag, are done.

Office Coffee Service in Transition Dan Ragan, Pod Pack Int’l page 34 Approximately two years ago United Stationers, the largest wholesaler to the office product industry, stated: “Own the coffee, own the break room (paraphrased)…”

Approximately 20% of an office’s expense is break room, and 80% includes remaining consumables.

The method is to price the 20% break room segment at or below cost, to capture the 80% remaining consumable office product segment, and provide coffee equipment and service at no-charge.

Scheduled coffee tasting continues to be a successful OCS method to prove a quality product.

The on-site tasting allows an operator to display national brands, locally roasted coffee, and private labels in the format the customer want Office Coffee Service is in transition; take advantage of the opportunities!

Keeping up with Industry Demands, A One-Way Street Alma Likic, Plitek page 36 As coffee industry demands and consumer preferences are changing, all of the industry players are shifting along.

Tea Sales on the Rise, Infusing Your Business, Stefanie Makagon, Garden to Cup Organics page 38 One thing is certain: the challenge is not in finding information, but in converting an overload of information into useful strategy and staying current in an industry where growth and change seem to be occurring at warp speed!…. coffee roasters, natural health industries, and food service industries are also positioned to profit from 10 tea’s rise in popularity…

Is our current system sustainable? Addressing Vulnerabilities to Our Industry, Marty G. Curtis, Just Quantify Coffee Academy page 40 I believe the farmer will not realize the gain until we actually have programs for the farmer on truly evaluating their coffee from seed to cup. This gives farmers tools so they can truly evaluate the coffee on their farms.

Meeting the Challenges Ahead, New Jumps From Solid Ground Bill Murray, National Coffee Association page 42 Ever better, younger generations of coffee drinkers have embraced coffee and café culture as never before, boding well for the future. Caffeine has been under greater scrutiny in 2014, with energy drinks and powdered caffeine creating new behaviors in consumers and tripping the government’s radar.

Customization in Coffee Industry Fosters Need for Short-Run Label Printing Amber Jechort, Primera Technology page 46 Mass customization has been a key driver in one of the largest bursts of innovation in the digital age.

Beverage consumers are notably promiscuous and willing to try new tastes and sensations.

The Graying of Coffee Farmers, Demographic and Societal Changes Paul Kurtz, Hemisphere Coffee Roasters page 48 Hundreds of farmers, who for many years have not seen a profit, struggle to stay afloat. They literally “owe their soul to the company store.”

Buying coffee as inexpensively as possible is not compatible with the desire for quality coffee, where farmers must be rewarded for their hard work. If there is no value or incentive added for labor, why continue to add it?

Devastating Emily, Combating Coffee’s Deadliest Enemy Donald Schoenholt, Gillies Coffee Company page 50 Bill Fishbein noted “There is no doubt that climate change is playing a role, but so is a lack of organic farming knowledge. This has led to resourcedepleted soil and a gene pool lacking diversity which has exposed coffee’s jugular vein to La Roya’s sharp edges.”

According to the USAID, as reported by Reuters, “The blight is jeopardizing the livelihood and food security of about 500,000 people who make their living in the coffee industry, especially small farmers and seasonal workers.”

The Danger of Hype Over Quality Rocky Rhodes, International Coffee Consulting Group page 52 This will be the challenge for 2015: Creating a final product scoring system, developing consumer awareness that a subjective scoring system exists, and finding a way for consumers to access the new system.

Brewing Up the Bottom Line José Estorino, Javatino page 54 For restaurants, using coffee as a tool can enhance

December 2014

customers’ overall experience and provide a competitive advantage.

A simple card highlighting specialty coffee offerings complemented by a dessert menu will increase the total check amount.

The Indian Coffee Industry, Challenges and Prospects Jawaid Akhtar, India Coffee Board page 56 The lack of active growers’ collectives / producer organizations in the Indian coffee sector places limitations on the reach and effectiveness of extension services and technological innovations.

Three Vulnerabilities David Gross, Add A Scoop page 58 You will have to find your strength in differentiating your concept by catering to the health and wellness sector of consumer demand; to do something the majors are not doing.

Another vulnerability to be aware of, and this is a must: You must pay attention to social media.

Your restaurant, whether you want it online or not, will be subject to crowd-sourced reviews on business ratings and reviews sites, the most popular of which is Yelp. If you don’t actively monitor your restaurant’s online reviews…

Tiny, Little Steps Bill Fishbein & Jake Fishbein, The Coffee Trust page 60 There is no such thing as Sustainability. And if there ever was, it died when it was labeled as such.

Labels are toxic. They imply that they are absolute, complete, and contain all the answers. And herein lies the problem. For once we believe we have all the answers, we stop asking the questions. And yet, it is within our questions that we can find the next tiny, little step.

Riding the Waves of Coffee Equality Don Holly, Industry Veteran page 62 The 4th wave has been defined as the practiced interdependence of the supply chain, with balanced sharing of risk and value from origin through consumption. It is an optimistic vision of the evolution of our industry, and we can only hope that it is not too late to ensure a sustainable future for our beloved product.

[K-Cup] has affected and will probably permanently alter the structure of how coffee is sold and consumed here in the United States.

The Industrial Internet of Things, The Rise of The Mechs Miles Small, CafeComm, Inc. page 64 In today’s rapidly advancing tech world, today’s billion-dollar supergiant is tomorrow’s liquidation auction.

Ignoring climate change and reforestation: an unsustainable effort Etienne Desmarais, Ecotierra page 66 Sustainable growth is clearly a hot topic in the industry. However, we need to take things step by step. While the environmental impact of singleserve products cannot be overlooked, we must first address the issue of making coffee farming a sustainable endeavor…

Sponsors Index Company

Phone Web

Page

1stPayPOS

(888) 638-7867

1stPayPOS.com

12

Add A Scoop

(415) 382-6535

addascoop.com

59

Asean/Stalkmarket

(503) 295-4977

stalkmarketproducts.com

43

Bloomfield Industries

(314) 678-6336

bloomfieldworldwide.com

27

BriteVision

(415) 374-8119

britevision.com

67

Buhler Inc.

(905) 754-8389

buhlergroup.com

13

Cablevey Conveyors

(641) 673-8451

cablevey.com

17

Cafe Femenino Foundation

(360) 576-5045

cafefemeninofoundation.org

51

Cargill Inc / Truvia

(855) 855-2362

truvia.com/foodservice

Cascade Coffee, Inc.

(800) 995-9655

cascadecoffee.com

25

Coffee Shop Manager

(800) 750-3947

coffeeshopmanager.com

57

Costellini’s

(877) 889-1866

costellinis.com

12

Daterra Coffee

+551937288010

daterracoffee.com.br

29

E. K. Int’l Col, Ltd. / Handy Brew

+886 2 2720 6058 ext.11

handybrew.com.tw

11

Espresso Me Service

(360) 213-0715

espressomeservice.com

12

Flavor Right Foods Group

(888) 464-3734

flavorright.com

45

Follett Corporation

(800) 523-9361

follettice.com

33

Fres-co System USA, Inc.

(215) 721-4600

fresco.com

31

International Coffee Consulting Group

(818) 347-1378

intlcoffeeconsulting.com

Java Jacket

(800) 208-4128

javajacket.com

9

53 15, 12

AllStar Tools POS

1stPayPOS 888-638-7867

12

Vacuum Container

Tightvac 888.42.TIGHT

Smoothies

Sleeves

ESPRESSO MACHINES

Costellini's 877.889.1866

Java Jacket 800.208.4128

Espresso Me Service 877.215.0715 360.213.0715

Espresso Me Service is your one stop for sales and service. We offer service on many types of commercial espresso machines and brewing equipment in Washington and Oregon.

www.1stPayPOS.com

www.tightvac.com

www.costellinis.com

www.javajacket.com

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Java Jacket provides the best insulation of all sleeves on the market. Protects customers from hot or cold to-go beverages, and provides a more grippable surface than other coffee sleeves.

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December 2014

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Innovative technology for a superb cup of coffee. From green bean to brewed cup, B端hler offers efficient equipment for optimal coffee production. From intake, cleaning, optical sorters and accurate weighing systems to programmable batch roasters and precise modular grinders, B端hler provides turnkey solutions for your coffee processing needs. Take your coffee to the next level with B端hler.

PO Box 9497 Minneapolis, MN 55440 T 763 847 9900 F 763 847 9902 buhler.minneapolis@buhlergroup.com, www.buhlergroup.com

Innovations for a better world.

Mother Parker’s Tea & Coffee Inc.

(800) 387-9398

realcup.com

21

National Coffee Association Of USA (NCA)

(212) 766-4007

ncausa.org

41

PBFY Flexible Packaging

(877) 224-7496

pbfypkg.com

55

Perka

(503) 427-1377

getperka.com

19

Plitek, Llc

(847) 827-6680

plitek.com

37

Pod Pack International, Ltd

(225) 752-1160

podpack.com

35

Primera Technology, Inc.

(800) 797-2772

primeralabel.com

47

Service Ideas, Inc.

(800) 328-4493

serviceideas.com

49

Shore Measuring Systems

(217) 892-2544

moisturetesters.com

63

TEAJA Organic

(604) 558-3252

teajaoffice.com

39

Texpak / Scolari Engineering S.p.a.

(856) 988-5533

scolarieng.com

3

The Coffee Trust

(505) 670-9783

thecoffeetrust.org

61

Tightpac America Inc.

(888) 428-4448

tightvac.com

12

uVu Lids

(855) 468-8883

uVuLids.com

Vessel Drinkware

(855) 883-7735

vesseldrinkware.com

Vita-Mix Corporation

(800) 437-4654

vitamix.com

Weldon Flavorings

(502) 797-2937

weldonflavorings.com

5 7

Who We are

Phone: 206.686.7378, see extensions below

Professional Memberships

Owner

Publisher Kerri Goodman, ext 1 kerri@coffeetalk.com

Administration Laurie Veatch, ext 4 laurie@coffeetalk.com

Editorial Staff Editorial Director Libby Smith, ext 8 libby@coffeetalk.com

Design

Print Design Marcus Fellbaum, ext 5 marcus@coffeetalk.com

Copy Editor Mark Moser, ext 9 mark@coffeetalk.com Web Design Justin Goodman, ext 6 justin@coffeetalk.com

Mailing Info

Mail: HNCT, LLC, 25525 77th Ave SW Vashon, WA 98070 Phone: 206.686.7378 Fax: 866.373.0392 Web: www.coffeetalk.com Disclaimer

14

CoffeeTalk does not assume the responsibility for validity of claims made for advertised products and services. We reserve the right to reject any advertising. Although we support copyrights and trademarks, we generally do not include copyright and trademark symbols in our news stories and columns.

Postmaster: Send address changes to HNCT, LLC, 25525 77th Ave SW, Vashon, WA 98070 Subscription: The cost of a subscription in the U.S. is $47.50 per year; in Canada, the cost is $72.00. Free to qualified industry professionals. Non-qualified requests may be rejected.

Publisher reserves the right to limit the number of free subscriptions. For subscription inquiries, please call 206.686.7378 x1 or subscribe online at www.CoffeeTalk.com.

Copyright Š 2014, HNCT, LLC, All Rights Reserved

December 2014

23 65

4 Ways Mobile Can Future-Proof Your Coffee Business

by Rob Bethge Perka, a First Data Company

T

he coffee industry’s outlook on 2015 reminds me of the opening lines of Charles Dickens’ novel A Tale of Two Cities: “It was the best of times, it was the worst of times.”

First, the “the best of times”: Quality coffee is more popular than ever. Consumers will gladly pay premium prices for fair-trade beans, new preparation methods, and a curated ambiance.

But even as coffee culture is now ubiquitous, so are Starbucks locations. Independent coffee shops are squeezed by chains, by increasingly sophisticated home preparation, by consumer belt-tightening - indeed, by each other. As coffee culture democratizes, it puts pressure on independents to raise their games.

Many coffee purveyors see “going mobile” as a box to check and nothing more. It may surprise you to learn, however: mobile can help you solve four top vulnerabilities coffee businesses face in 2015.

A word on mobile payments You’ll notice right away that mobile payment isn’t a near-term vulnerability I discuss below.

Mobile payment is exciting, but it doesn’t solve a particularly pressing customer problem. You can already pay for your coffee a zillion convenient ways. Paying with your smartphone will impress your date, but it won’t make your life appreciably easier.

Mobile payment is coming, however, and coffee brands must embrace mobile generally for long-term survival. But how do you start? Enter mobile loyalty programs. By encouraging repeat business with a mobile program, you’re forging a crucial mobile link between customer and merchant, paving the ways for lots of exciting longer-term innovations with near-term benefits that merchants and customers love.

Problem: Earning rewards can slow down the line.

Solution: Beacons automate mobile check-ins for regulars.

Beacon technology is perhaps the most exciting innovation to hit mobile loyalty for coffee businesses. We predict it’ll become widespread by the end of 2015.

a low-energy Bluetooth signal that nearby mobile phones can respond to, like moving ships. You roll up to your favorite coffee shop, phone in hand. You’ve already signed up for a loyalty program and checked in manually once.

Sensing this, your mobile app asks if you’d like to automate future check-ins with this merchant.

If you agree, you’ll be automatically checked in every time you stroll into the shop.

Beacons automate mobile check-ins, which eliminates fumbling for your phone and keeps the register lines moving. But beacons also empower merchants to deliver magical new retail experiences. If you browse near the coffeemaking equipment, a mobile message can alert you to cool products on sale. With automated check-in, mobile pre-ordering becomes infinitely easier - see below. We’re just scratching the surface with the potential of beacon technology, but it’s sure to be tremendous.

Problem: Customers only stop in for morning joe.

Solution: Targeted mobile specials bring them back all day long.

It’s an age-old problem: how do you tempt the AM-coffee crowd back for lunch or snacks?

Answer: mobile specials tailored to their preferences.

Say it’s a rainy, cold Thursday afternoon. You ping your customers with a demonstrated sweet tooth for a 3pm snack: get 2 cookies for the price of 1 - while they’re still warm! The customer checks in at your store and taps the special to redeem it at the register - nothing simpler or more satisfying.

Mobile specials are an incredibly versatile tool for coffee businesses. Introduce new menu items to customers likely to enjoy them. Drive foot traffic during slower hours. Cross-sell products your customers may like, but just aren’t aware of. Surprise loyal customers with an occasional treat. Try a “Like Us to Unlock” mobile special to motivate your social media fan base. Think of mobile specials like a barista well-versed in every one of your regulars’ tastes. They can confidently recommend a new menu item or today’s special, and customers will appreciate the personalized assist.

Think of beacons as lighthouses: they emit

16 December 2014

Problem: Who has time to wait for an order?

Solution: Mobile pre-ordering speeds up the line.

Another mobile innovation on the horizon for 2015 is mobile pre-ordering. The concept is simple but thrilling: instead of rattling off the details of your daily coffee order, your mobile app will soon know your regular order and alert wait-staff to start preparing it as soon as you check-in. Talk about speeding up the line.

Problem: How can you personalize service and market more effectively?

Solution: Mobile puts “big data” to work for small coffee businesses.

Another under-appreciated benefit of mobile loyalty programs is how data-rich they are.

Customer buying habits, purchase frequency, product and reward preferences, even how successful your latest mobile special campaign was - coffee merchants can know all of that and more instantly with a mobile loyalty program.

Marketing insights are yours for the asking once you’ve got a mobile loyalty program up and running.

Mobile loyalty helps you test your best hunches about what new menu items to introduce, how to boost foot traffic, which higher-value products to cross-sell, and much more. It complements your social media efforts nicely, too. Best of all, the data you’ll gather with a mobile loyalty phone helps you cultivate deep and lasting relationships with your customers in an intimate space: their mobile phones.

By Rob Bethge, VP of Perka, a First Data Company For more information about Perka and other business solutions, please visit www.firstdata.com/smallbusiness or call 866-965-8330.

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Cooperative Programs

Facing Challenges Together with Research and Innovation

by Luis F. Samper Colombian Coffee Federation, Inc.

T

oday’s mild arabica coffee farmers face market volatility, exchange rate fluctuations, climate variability and the increased prevalence of plant blight and harmful insects that accompany climate change.

They tend to have small coffee plantations, of around 4 acres in size, and their children do not want to continue with farming. At the same time, consumers and the industry expect farmers to use sustainable methods, meet stricter environmental standards and continue producing exceptional quality coffees at high altitudes.

For mild arabica coffee to continue being an option for the 21st century consumer, the commonly increasing challenges that growers face also imply collective action. In order to accomplish change in the scale required we need common objectives, articulated strategies and, more importantly, the capacity to implement them.

While there are many challenges, in this article I will concentrate on three: the need to achieve consensus to initiate bold plans, the challenge of coffee leaf rust, and the need to make sure that the market works for small farmers.

Institutional framework Colombia has a strong institutional framework to help overcome today’s challenges. Since 1927, the Colombian Coffee Growers Federation (FNC) has been part of that story, helping to establish and preserve the legacy of our nation’s signature export. Perhaps the biggest FNC asset is its ability to provide a process for growers to agree on common objectives. Thanks to the legitimacy and democratic character of the FNC, growers can voice their needs and participate in joint decision making.

Being able to represent and make decisions on behalf of growers is crucial. Their mandate is renovated every 4 years through coffee grower elections; the last took place this past September.

These elections are the biggest of any agricultural institution in the world. Selecting their legitimate FNC local, provincial, and national leaders for the next four years is the first step toward arriving at common objectives.

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Thus, democracy underpins the ability to develop common policies, sustainability projects or promotional campaigns. The creation of the well-known Juan Valdez brand would not have been possible without this system of developing

collective action. This framework also facilitates the development of collaboration agreements with a number of clients, NGOs, international cooperation agencies, and governments. It also provides the legitimacy to defend coffee growers’ interests in international sustainability discussions or even domestic political economy struggles with other industry stakeholders. In sum, we believe that without a strong institution to accomplish projects to overcome common challenges, mild arabica coffee farming will not be viable in the long run.

Combating Leaf Rust through Institutional Models Between 2009 and 2011, Colombia had to face one of its most difficult sustainability challenges. Up until that point, no single certification protocol had suggested a strategy against the coffee leaf rust (Roya). Production was impacted throughout the region, with the average Colombian farmer experiencing a 30% reduction in yields during that period.1 While Colombia and the FNC’s Research & Development Center, Cenicafé, were ready for the crisis in terms of providing new varieties, one aspect is to have the seeds and yet another very different is to have growers adopt it and overcome industry skepticism. It is thanks to the FNC institutional framework that we were able to renovate nearly 3.2 billion trees since 2009, making two thirds of the country´s plantations rust resistant. Over the last five years, more than 420,000 coffee growers renewed their plantations, investing over $1.5 billion. Thanks to the ambitious renewal of coffee plantations and production reconversion developed by the FNC, Colombia made an impressive leap in production and farm modernization. Average productivity has reached 15.2 60-kilo bags of green coffee per hectare, the third highest of the past 14 years.

The main focus of this program is to provide the conditions for producers to sell small quantities of coffee at transparent market prices 365 days a year at more than 500 purchasing points across the country, in cash, close to their farms. This provides market access to small producers, which allows them to capture a higher value in spite of transaction volume, which is often very limited. Since we are dealing with small plantations that are harvested throughout the year, the average transaction volume when a grower goes to market is of less than 60 kilos of green coffee. If it were not for this system, the market would cease to operate, to the detriment of coffee growers, whose negotiating power is very reduced in their local communities.

Of course, there are a number of additional challenges that need scaled up solutions and that can only be overcome with a strong associativity and institutional models. The ability to develop Geographical Indications, minimum quality requirements that enhance the origins’ equity and positioning, or wide scale sustainability efforts are just a few of them. The lesson is clear: united we can do more. All too often, consumers view coffee as a simple commodity that they take for granted; many traders want to see it as an interchangeable good that is just to be traded.

Colombian growers, however, take a different view. It is their pride and the result of individual and collaborative efforts. When you have a chance, please stop and smell the beans and become aware of the challenges that hundreds of thousands of coffee growers currently face and their ability to overcome them.

1 If interested on how this was accomplished please watch FNC’s lessons on sustainability. Oxford, CABI, 2013. https://www.youtube.com/watch?v=kjfA8L10RBw

Purchase Guarantee One of the biggest problems small plantation owners have is the ability to sell their crop at transparent market prices that reflect the international value of their crop. In addition, they need to sell their harvest as it matures, with the liquidity of a cash payment. Colombia´s system to ensure that coffee growers receive the highest possible proportion of international prices for their beans is possible thanks to the Purchase Guarantee Policy (PGP).

Luis F. Samper, Chief Communications and Marketing Officer, Colombian Coffee Growers Federation

December 2014

Gender Equity in Coffee

Challenges and Opportunities

by Susan Cote CQI- Coffee Quality Institute

I

f you are involved in coffee, it is not news to you that the industry today faces an array of challenges—including climate change, plant disease, food insecurity, producer community out-migration, among others—that threaten the livelihoods of farmers and the supply of quality coffee required by roasters and retailers. But on top of these issues lies another, less talkedabout challenge faced throughout much of the developing world: how to empower women within their communities.

The Coffee Quality Institute (CQI) has launched a new project, the Partnership for Gender Equity (PGE), aimed at better understanding gender concerns at origin and how CQI and other industry members can help address them.

The collaborative research initiative includes participatory workshops in four countries, as well as an extensive literature review, to produce a final report containing recommendations for action, including further areas for study, pilot projects, and investments.

Why focus on gender equity now?

With so many difficult and urgent issues to address in the industry, one might question whether committing resources to gender equality at this time is a priority.

“Because of the scale of our challenges, I believe we can’t afford not to focus on gender equity,” said David Roche, CQI’s Executive Director.

“Experience around the world demonstrates the positive impacts of empowering women in agricultural communities and indicates a clear opportunity to strengthen the coffee supply chain – to make it more resilient in the face of adversity. This fits the mission of CQI: to improve both the quality of coffee and the lives of those who produce it.”

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The promise of empowering women in developing economies, the high return on investment, is so well documented that most government and NGO development organizations now require a gender equity component for development programs. Yet there remains an opportunity to develop specific approaches for coffee-producing communities to encourage and capitalize on improved gender equity. And members of the industry need guidance on how they can support that effort throughout the value chain.

“There has been quite a bit of enthusiasm and support for the initiative. It is clear that the coffee industry is looking for some direction. They know it is important to address gender equity, but don’t know the ‘how’,” commented CQI’s VP of Strategic Partnerships Kimberly Easson. “The Partnership for Gender Equity aims to provide us with an informed approach to tapping into the full capabilities of both men and women in coffee growing communities – and importantly, an approach developed collaboratively with members of those communities.”

From Left, Carolyn Fairman and Kimberly Eason participate in visioning exercise with coffee producers at gender equity workshop in Popayan, Colombia, October 2014

December 2014

Developing a producer-based perspective The first interactive gender workshop was held in October 2014 in Popayan, Colombia with 34 local men and women farmers and six international industry participants.

Together they explored the balance of power in community and supply chain relationships, the relative share of work and income, and other dynamics that influence the well-being of communities and hence, the health of the coffee supply chain. Through the workshop exercises, participants gained new perspectives about the value of women’s work and the importance of making shared decisions on issues that impact family well-being. Building on this new understanding, the group discussed a vision for the future, and how to improve upon current conditions based on the gender analysis.

Future workshops are scheduled for Nicaragua in January 2015, Uganda in February, and Indonesia later in the year.

Industry participation for success ACDI/VOCA, the respected global development organization and a leader in inclusive market development, recently committed to becoming a founding partner for CQI’s gender initiative, bringing both core funding and a combined expertise in strengthening coffee value chains and increasing gender equity in households, communities and markets around the world.

Additionally, AMFOTEK, a developer and manufacturer of premium coffee and other beverages and a 100% woman-owned business enterprise (WBE) based outside of Chicago, has signed on as a founding partner.

CQI continues to invite involvement in the initiative through funding opportunities and workshop participation. Interested industry members should contact Kimberly Easson at keasson@coffeeinstitute.org.

Susan Cote, Consultant, Coffee Quality Institute Gender Initiative

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Consistency In a Growing Industry

by Tyler Bruno Curtis

O

f all the discussions I’ve had in the world of Specialty Coffee— debates over proper use of Extract Mojo, militant agreement or disagreement with whatever Scott Rao book just came out, that cafe/roaster that used to be cool but like, totally sold out— there’s one that I’ve always been particularly gripped by: Consistency, and in particular, what we actually talk about when we talk about consistency.

It’s a subject mulled over the way a younger you once dreamed about being an adult— with bright, lofty expectations, but no clear idea on how we’ll all actually get there. In the still burgeoning industry of Specialty Coffee, where agreement is not always an option, we can at least collectively and decisively share one dream.

Growers, buyers, roasters, baristas, customers— we all want to have our coffees taste as good as they can be, without fail, all the time.

Obviously, a great many factors go into this. And of all the beverage industries, we have some of the most unique hiccups in terms of challenges.

The one that stands out to me— and for the purposes of this essay, the one I’ll set my focus on— is that our drinks are largely all made from scratch materials and all made to order.

There at the very end of the coffee bean’s journey comes its biggest threat.

Our friends in similar industries don’t have this problem. The moisture content of malts that go into a craft beer, the almost superstitious way a vintner positions his grapes, a whiskey connoisseur’s selection of the perfect barrel— these are all decisions made behind closed doors, with the peace and purpose that comes with clear-cut practices and methodology. This is similar to a scene you would see at a coffee roasting facility. But where the story ends for most beverages, ours has one last chapter.

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Cafes, in contrariety to roasting facilities and processing locations, are often bustling, demanding places. They’re more akin to a busy open kitchen than the hushed laboratories discussed above, and the baristas are more akin to cooks. Orders come in, are passed down the line, executed, then passed along. Outside of the cafe, we can focus in on the smaller parts that move the larger wheel. But the make or break of our industry falls on the barista, and once those cafe doors are open, it’s game on. This requires repetition more than it does artistry, a concept that can be met with a fair amount of resistance.

Charging someone the same price for a drink made by a skilled hand and one made by a shaky newbie on his first day is not only an ethical gray area, it will hurt your business, and the industry, in the long run.

In my experience, consistency in the cafe is something that is feared more than it is celebrated. If we deliver the same product, over and over again, without deviation or improvisation, then there is very little that separates us from being fast food employees.

Third-wave baristas are often times referred to as artisans, and artistry by its nature does not value consistency.

But perhaps we should be emphasizing it more.

Because without a repeatable experience, it may be significantly harder to have patrons come along and support us. We need constancy in order to give new customers a frame of reference for why Specialty Coffee is valuable. Say you had a restaurant you really loved. But, if the food was only sometimes good and at its worst, terrible, you’d find a new restaurant. Even some of my favorite specialty cafes suffer from sporadic quality.

Because we’re a newer industry that is heavily influenced, almost defined, by growth and innovation, it is hard to find a repeatable model while also progressing forward. But there are things that I believe we can do to help.

Being transparent with ourselves and others is a step I see many have already taken. Sharing roast profiles, TDS readings, and endless brew recipes/ theories in a respectful manner is practically commonplace while more and more educational books and videos are becoming available (I can

December 2014

remember a not so distant past where there seemed to be only online message boards and that one book by David Schomer.)

Openness to the growth of automation is, in my opinion, another move forward. While once looked at with skepticism in third-wave cafes, shops all over the world are embracing a new generation of batch-brewers and volumetric machines to help unburden baristas during the busy cafe hours, freeing up their focus to serving and engaging the customer rather than fighting against scales and timers.

This also changes how shops can be set up. With the advancement of automation, you need fewer baristas. While this is often seen as a threat to working baristas everywhere (including myself at a time), what this actually means is more money and control for the career baristas that are in it for the long haul, while also providing a position made up of simpler, easier tasks for the people that just want a cool job while they’re in school or pursuing other fields.

Reality is that most baristas will not be permanent baristas, and the training it takes to get a novice to the level of skilled professional is an investment too great for many small businesses. This isn’t just because of the sheer amount of product and time it takes to train, but also because you’re now “trying out” your investment on paying customers. Charging someone the same price for a drink made by a skilled hand and one made by a shaky newbie on his first day is not only an ethical gray area, it will hurt your business, and the industry, in the long run. The customer is paying for inconsistency, but they won’t pay forever.

The last step towards consistency that I’ll speak about is this: Acknowledging the fact that we’re testing ourselves on a live and paying audience and that our goal is to keep them around for the journey forward. By simply keeping this at the forefront of our decisions is a step in the right direction. With the way we treat our patrons, our educational spiels to friends who aren’t quite sure what you do for a living, the way we hold ourselves as professionals— in all the intricacies that go into what we do— we should do with the mindset that most customers are still testing us too, and the goal should be to make that as comfortable and rewarding an experience as possible. Talking, sharing, testing, challenging— this all will continue to push us forward for that ever changing and lofty goal: To make coffee taste as good as it can, consistently.

Thank you for another great year! We are very excited about our upcoming introductions for 2015.

VESSELDRINKWARE.COM | INFO@VESSELDRINKWARE.COM | 855.883.7735

August Afternoon Seeks Cool Operators

by Mike Purcell Follett Corporation

I

t’s midafternoon in August, and I’m walking through the lofty corridors of a landmark hotel in the heart of a major east coast city.

I’m walking past gorgeous displays of exotic flora, past the elegant water display with arching fountains, and right past a lonely looking barista, idly polishing her MegaBucks Italian espresso machine, which is parked behind eight or so

empty barstools at this very hip, very deserted lobby coffee bar. I’ve got 20 minutes before my next meeting, just around the corner from this hotel; the roasted coffee smells delicious, and the lonely barista and her coffee bar look so friendly and inviting. There’s just one catch: I’m a coffee LOVER, but I rarely drink hot coffee after 10:30 in the morning. It’s a quirk of mine.

In fact, I generally don’t drink anything hot in the afternoon, especially in August, but a quick check of the menu here says I’m out of luck: there’s coffee, Café Au Lait, Café Mocha, Café Latte, Mocha Latte, and Espresso shots.

No iced coffee, and no iced teas. In fact, nothing cold at all. I keep walking.

I walk to the nearest escalator, down toward my meeting. At the bottom of the escalator is the hotel gift shop, nearly deserted this time of the afternoon.

The encounter with the lobby coffee bar has ignited my daily drive for a nice, cold beverage, preferably a lovingly brewed iced coffee.

Maybe even a nice, delicately flavored iced tea. In any case, something cold and delicious, with some chewable ice I can linger over and savor during my meeting.

I walk into the hotel gift shop, hoping I might get lucky and find something perfect to take to my meeting. Alas, while they do have cold teas and chilled coffees here, they don’t have the lovingly brewed kind, just the kind with flashy labels, and unfathomable ingredients listed on the back: “high fructose corn syrup, sodium hexametaphosphate, caramel color, natural flavors (really??)”. Every one of them is somewhere between 100 and 300 calories, and of course, this small gift shop also doesn’t have ice, which kind of kills the deal for me. The days of sodas and slushies has passed me by; I’m a cold brewed, low-cal kind of guy these days. I keep walking.

24 December 2014

Around the corner I enter the lobby and reception area for the company I am meeting and check in with the receptionist. I’m ten minutes early so the friendly receptionist tells me to help myself to a beverage in the adjacent lounge and . . . HELLO! Imagine my pleasant surprise to discover an inviting array of single serve coffees, a modern looking state-ofthe-art brewer, and YES! an iced tea program.

Sitting smack dab in the middle of the counter, separating the rack of single serve coffee choices and brewer, is one of those beautiful little countertop ice machines, the kind that makes delicious, chewable ice. In a box to the right of this ice machine is a selection of bagged teas, including some that say “cold brewed” right on them. Jackpot! A moment ago I was mildly perturbed at not getting my afternoon pick-up, and now here I am looking at an enticing selection of teas. I’m pretty sure I could figure out how to make an iced coffee here too, if need be.

I had my meeting, a good one, and enjoyed my cup of iced tea. Even as I participated in the meeting, my mind had latched onto something I couldn’t stop thinking about: in a world gone “hot coffee crazy,” where are all the iced tea and iced coffee options? Please understand, I LOVE coffee. It’s great you can get pretty good hot coffee almost anywhere. And the variety!

Yet, I’ve discovered there’s more to daytime liquid refreshment than hot coffees and teas.

Particularly in the afternoon, and even more particularly on hot days or in hot climates, there are cold beverages. Cold teas, cold coffees, heck, there’s even cold water!

So why isn’t it easier to get a great tasting, personalized iced beverage? The market is there.

The hot coffee folks have proven that given convenience and choice, people will embrace their options and do what consumers do best.

Studies have shown iced coffee and iced tea are growing trends, and have shown that afternoon dayparts in particular are underserved by hot coffee only. I do understand not everyone has an ice machine handy, but I also know there are good ones out there that fit the bill, and you can’t make iced drinks without ice. So now I’m waiting, patiently, for the inevitable growth in delicious, iced teas and iced coffees, in every office break room, in every lobby lounge, in every place we want them to be, and in every flavor and style imaginable. And I’ll have mine with that nice, chewable ice, please.

Go Grateful

For Customers and Employees

L

ike many industries, the global coffee industry is faced with challenges of an inventively limitless number and variety.

Climate change feels beyond the industry’s control. Irrigation and artificial feeding of the trees can in some cases be used to deal with this, but in many countries this is just not possible. Crop-related diseases are another challenge – curious sounding names like Roya fungus, leaf rust and coffee berry borer make us quake. Fungicides can help, but if you are an organic producer, you just don’t have this option. Urbanization is yet another challenge, with excellent coffee growing land being sold off as farmers are given choices and chances to get substantial payouts they never had access to before. Shifting consumer preferences, with a limitless number of options, are yet another constant trial.

Most of these factors seem out of the control of coffee-associated companies, which are vulnerable to losing business, customers, crops, land, employees and even their reputations.

Finding effective strategies for dealing with the sense of defenselessness, exposure and helplessness that is emerging can be daunting.

So what can coffee companies do when they experience this vulnerability in so many arenas?

The first step is to recognize that many things are truly out of their control, although there are always some positive actions they can take.

But there is one tactic that is totally within each and every coffee industry member’s control and capability: They can proactively and successfully become conscious of, and express their gratitude in, every aspect of their work and their lives.

It has been proven through many different scientific studies and case examples that the practice of gratitude creates extremely positive results and actions.

Let’s start with the example of employee retention – there are so many different options for today’s workforce, and so little loyalty.

Whether it is an awesome barista or a creative, resourceful, innovative corporate executive you want to keep, there is little faithfulness in today’s workplace with a major exception: loyalty and engagement are the result when people feel we value, appreciate and are grateful toward them!

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So what are the real benefits of acknowledgment and gratitude in the workplace? The Gallup Organization reports that a whopping 52 percent of people are not engaged in their work. They are the “sleepwalkers,” those just putting in time.

by Judith W. Umlas International Institute for Learning, Inc.

It has been proven through many different scientific studies and case examples that the practice of gratitude creates extremely positive results and actions.

I say they can and will be engaged – and stay engaged – if leaders first become conscious of their own gratitude and appreciation toward their people, and then express it to them. The Society for Human Resource Management (SHRM) said in an employee retention study that the number one reason people leave is lack of appreciation. Gratitude will not only keep them there, but make them perform to their maximum levels.

This form of leadership is what our employees, our vendors, our suppliers, and yes – certainly our customers – truly want. We hear so many stories about good people who leave good jobs at good companies because they DON’T feel appreciated. How can the coffee industry prevent the loss of these contributors?

Expressing gratitude, and establishing cultures of appreciation are such simple, cheap and always available solutions that not only make “sense” – they makes dollars! Lots of them! The five C’s of Acknowledgment (Consciousness, Choice, Courage, Communications and Commitment) are a great way to start practicing this.

Keeping customers and gaining new ones is a priority in this industry. It is a given that customers love to be treated with respect and caring, and with gratitude for bringing their business to our particular coffee shop, and for buying our own brand of coffee. They like knowing that we are caring for others, too! So when Starbucks, for example, takes this kind of action: “In honor of World AIDS Day, Starbucks will make a 10 cent (U.S.) donation for every handcrafted beverage sold in participating U.S. and Canada stores,” or Dutch brothers honors cofounder Dane Boersma, who died of Lou Gehrig’s disease, by having all locations annually donate one designated day’s proceeds to the Muscular Dystrophy Foundation, this tugs at

December 2014

their customers’ heartstrings. They feel proud and good about purchasing from a company that cares about others, not just about profits.

Loyalty cards are another way to show gratitude to customers and support customer retention.

There are many choices available to consumers, so we need to express gratitude toward those who choose what we offer!

And without a doubt, gratitude is contagious!

People respond in kind when they feel appreciated, or receive some special customer service. They tell great stories about the service they receive. They tweet about it, they go on your blogs and comment. They come back and bring their associates.

Moreover, don’t forget the emotional and health benefits of gratitude and acknowledgment – both for the giver and the receiver! Dr. Michael McCullough reported in a study that focused on the effects of gratitude on physical and emotional well-being that people who practiced gratitude rated their lives more favorably and experienced fewer symptoms of physical illness, such as stress and fatigue. When we feel a sense of well-being, it is much easier to appreciate and express gratitude toward others.

It is clear that there are many challenges that may seem out of control at times for the coffee industry. So when you as a proud but worried member of it are feeling vulnerable, Go Grateful!

It’s a surefire way to get unpredictably positive results, for you and your recipients!

Please visit: www.GratefulLeadership.com

Judith W. Umlas, Senior Vice President, Author, Trainer, International Institute for Learning, Inc. (IIL)

Branding for the Future

O

ver the past 20+ years I have had the opportunity to speak to countless numbers of coffee professionals at conventions and seminars around the globe.

Marketing is a hot topic, but Branding is rarely if ever discussed.

Regardless of the industry or the size of the company, Branding is one of the most important aspects of a successful business.

There comes a time in every business when it is essential to consider re-branding. Re-branding is a scary proposition for established businesses…will people accept a new name, logo, or buying proposition?

This is the question that one well-known roaster/ retailer faced when he decided to change his company’s name and image from Caffé Pronto to Ceremony Coffee. I asked Vincent Iatesta why and how he made the change.

Many of you will relate to this story. After more than 10 years in business, Vincent and his team wanted a brand that was better aligned with the company’s products, quality and service offering.

He believed the name Caffé Pronto sounded like a QSR establishment and was a hindrance in building the wholesale business rather than a brand that target customers engaged with. They were already working hard with customers, sourcing amazing coffees and roasting light to highlight the terroir, but the Caffé Pronto concept didn’t really capture or convey any of this.

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They took a hard look at their business and through a year-long internal rebranding initiative, arrived at the Ceremony concept, and “we haven’t looked back”. Changing the name of the company was a start, but it also required new packaging, website and everything else related to the identity. They also fine-tuned other aspects of their business model.

• A significant focus on seasonally fresh single origin coffees replaced a heavy hand on blends • Remaining blends were renamed to align with the new brand • Both wholesale and retail menus were simplified and more coffee-centric • Customer service capacity was improved in admin, tech support and training The entire focus of the company changed from mainstream coffee offerings to celebrating the origin, production, and services of coffee.

by Linda Smithers Daterra Did it work? The retail and wholesale growth of Ceremony is amazing. They continue to re-evaluate the business with the same thoughtfulness they used when they did their original re-branding. For more information about Ceremony coffee visit www. ceremonycoffee.com.

Rebranding is not just for roasters and retailers.

Producers are faced with the same challenge of ensuring their brand is aligned with their mission, values, capabilities, and customer’s needs.

This year one of Brazil’s most innovative coffee producers took a long hard look at their brand proposition. After a trip to Europe in early summer, the Daterra marketing team lead by Gabriel Moreira decided to accept the challenge they received from existing and potential customers…

“We don’t want to purchase the same coffee that other roasters in our community are purchasing. We want something special and exclusive from all of coffee supplies”.

Daterra had built a reputation of being a big farm with a strong focus on automation and quality.

The problem was, as the Daterra brand became more recognized and widely used, some roasters began to think of the company as too big and not able to meet their business focus. What made the Daterra brand strong now appeared to be a barrier to success.

For years, the Daterra production and marketing team had been talking about the hidden jewels or masterpieces on the farm. Last year they decided to conduct an auction to provide better recognition of the Daterra brand as a niche coffee producer. Even after the success of the auction, roasters were still not clear about the capabilities of the farm.

• • • • • • •

15,000,000 trees Average annual production of 10 million pounds of green coffee GPS farm management Advanced sorting equipment Focus on experimentation and innovation…dedicated scientist on staff 100% Traceability…ability to sort all coffee production by location on the farm, varietal, processing method and cup profile Full quality range of products

The team recommended the Three Farm branding concept as an effective tool for roasters to help determine what level coffee they need for different uses.

Brands of Daterra

Quality

Attributes

Classics

82-85

RA Certification – Large Quantities marketed by menu name. Used for blending and single origin brewing.

Collections

85-88

RA Certification – Registered by lot and menu name.

Recommend for single origin brewing.

Masterpieces

89 -

RA Certification – Very small lots, exceptional quality, fully traceable, rarely reproducible

Thus, the Daterra rebranding project was born.

The task was straightforward but the work was anything but simple. How do you re-brand a large 20-year old farm to meet the needs of the current market?

The marketing, production and quality teams had no option but to work with the reality of the farm. The following were a few key realities, which proved to be both plusses and minuses for the team.

• 17,000 acres, with about 40% planted in coffee

December 2014

To learm more about Daterra Coffee contact them at www.daterracoffee.com.br

azul

Introducing Daterra Coffee’s 2014 crop and Three Farms concept

D A T E R R A

The largest farm with beans that represent the best of Brazil Cerrado with the benefits of Daterra’s quality. Our Classics offer a variety of cup profiles suitable for blending and single origin enjoyment.

Learn more about the Three Farms and its coffees Or go to: http://goo.gl/CLBVjG (Use small and capital letters)

This “small farm” is a lab where we test new innovation in producing and processing coffee. New and unusual varietals, processing methods and limitless experiments that yield unique small micro-lots we call Masterpieces.

Our Collection farm features some of the best coffees from our plantations.

They are processed using the Daterra Penta Process® and deserve to be your single origin Brazils.

Join our 2014 micro and nano-lots Auction.

Register now and order your sample pack: auction.stoneworks.com/DC2014

Resilient Together

by Rick Peyser Lutheran World Relief

F

our years ago I had the opportunity to visit a community-based small-farmer cooperative in San Jeronimo, Nicaragua that is part of PRODECOOP, the well-known 2,000-member Fair Trade Cooperative. I was traveling with Raul Diaz, Director of CIIASDENIC, and Chris Bacon, a researcher for the Community Agroecology Network.

These organizations were part of a new food security project that was being funded by Green Mountain Coffee Roasters at the time. The goal of this project was to help families become more resilient to “los meses flacos” (the thin months of food scarcity) and to other potential shocks that they might be exposed to at the household level, like climate change, low market prices, and more.

San Jeronimo is a small, isolated rural hamlet in the municipality of Telpaneca, in the northern department of Madriz. One dirt road runs through village that consists of 40 or so small homes that are visible from the road.

This particular morning, we were planning to meet with the cooperative’s leaders to talk about the plans for the food security project.

During the meeting I remember asking the co-op leaders what their dreams were for this project. First, they wanted to establish a seed bank so that they could save the seeds of crops that grew well in their community - seeds of products that their members’ families liked to eat. They said that the government often offered free or low-cost seeds, but these were frequently varieties that either didn’t grow well in the local micro-climate or were not vegetables that the families like to eat. Secondly, they also wanted to establish communal silos where families could store basic grains.

Two years later, when Raul and I again visited San Jeronimo, we met a very motivated woman who had left space in the middle of her small cornfield for a vegetable garden. She expressed concern about having enough water for the garden during the dry season. Twice a day, families in the area hiked almost a half-an-hour up a large hill with buckets to fetch the cleanest water at its source. They spent almost two hours a day gathering water to meet their families’ basic needs for this precious commodity. I asked Raul if CII-ASDENIC had ever implemented a potable water project. He told me the organization had worked on a few municipal water projects, and was hoping to do more. Two

Members of this community have withstood the shock of losing 85% of their income yet are still working their coffee.

months later, a water component was added to the food security project in San Jeronimo.

Little by little, both projects took shape. Family gardens were developing, and the seed bank became a reality. During one of my visits, the entire community was out shovels in hand, digging a 3-foot deep trench and laying plastic pipe from the water’s source, downhill to the small hamlet.

This March, Raul and I met with the Water Committee, made up of co-op members. They provided an encouraging report on the project’s progress. Toward the end of the meeting I asked the Committee’s leader, Maximino Gutierrez Lira, if San Jeronimo had been affected by la roya, or coffee rust disease. He slowly shook his head up and down, and said that two years ago the community co-op collected 2,000 quintales of coffee; this year 300 quintales - an 85% drop in yield due to la roya. This was the harshest impact from la roya that I had run into in all of my travels. The norm was closer to a 25-65% loss. I was stunned. I asked Maximino, “Have you lost co-op members to migration?” He said, “No.” I was confused, and couldn’t imagine any family or community withstanding an 85% loss of income from coffee and not leaving this remote area for other paid work. I must have looked confused too, for Maximino said, “Follow me.”

We walked over to the side of the co-op building and entered a room that had eight 7 ft. tall metal silos filled with dried corn and beans. He explained that families filled these silos together, and together they would draw from these grains during “the thin months” to feed their families.

If there was any extra, they would together decide to sell this excess into the local market as another source of income. Then Maximino said, “Let’s go for a walk.”

We left the co-op building and walked down the only dirt road in town. In front of every home there was a 4 ft. tall cement piling, painted bright green, with a spigot on top. Maximino explained that every home now had fresh, clean water delivered right to house. In addition to providing abundant clean water for drinking, families were using the water for their food gardens. We walked behind a few homes with their owners and saw beautiful and productive gardens. He explained that with fresh clean water, bountiful vegetable gardens, and the communal silos for food and income, families had no need to leave the community. In fact, they were better off now, even with la roya, than they were four years ago.

What has San Jeronimo taught us? Members of this community have withstood the shock of losing 85% of their income yet are still working their coffee. While resources are needed to start projects like this, this lesson is about more than resources. It is about the importance of motivation, the positive attitude of San Jeronimo farming families, and their willingness to work together for the common good. They are a model of resilience; a model that our industry desperately needs to replicate if we are to thrive from tree to cup in an increasingly challenging environment. If we are interested in the longterm health and resilience of our industry and a consistent supply of specialty coffee, we must follow the lead of the farmers of San Jeronimo, and work and invest in our future together, which starts on the farm.

Rick Peyser, Lutheran World Relief

30 December 2014

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The Price of Emission

by Jim Townley Fresh Cup Roastery Cafe

T

here are a number of sayings that depict the concept; ‘the more things change, the more they stay the same’, like ‘what goes around comes around’, and there is example after example that suggests the same for the fashion world. I recently remember bell-bottom jeans and the colour combination of pink and chocolate, and I was around the last time those things were the hot thing in a Sears catalogue.

The world of coffee is no different. For example, coffee bars all over North America are doing pour over coffee once again, and we can thank Mrs. Mellita Bentz for that simple little invention she created back in 1908. The way coffee bars talk about pour-over single cup brewing you would think that this was the newest thing to hit coffee culture this century. On the note of the pour-over single cup coffee concept, one could even go as far as to say that it was never really ‘out-of’ style.

Another incredibly popular coffee-thing these days in North American is ‘micro-roasting.’

The term itself takes on various definitions, but with the proliferation of macro level roasting companies all looking for their share of the market, small independents are arming themselves with knowledge and high-quality organic green coffees from around the world, prepared to take on the self-professed coffeeloving public by introducing the ‘theatre’ of roasting. These small micro-roasteries are similar in look and feel to the hundreds of small-town coffee roasters that came from the birthplace of coffee, and made their way across Europe for the past few hundred years.

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I think coffee is following in the footsteps of the beer industry and I’m not the first person to make that connection. Take for example what’s happening in Portland. There are dozens of micro-breweries, and now micro-coffee roasters.

These hipster-feeling coffee enclaves range in level of décor from simple and rustic to sheikfeeling tasting bars that parallel some of the world’s best martini bars. What this resurgence is doing well, is driving home the value of freshness as it translates to value in the cup. As coffee drinkers’ palates evolve, the days of roasting coffee in some plant in an industrial section of town, putting it into a box and shipping it to different points of distribution, hoping someone likes the look of your bag, are done. And I mean DONE. We put too much faith in the teenage stock-person to rotate the coffee on the shelf and all the macro-roasters are still trying to get the

As coffee drinkers’ palates evolve, the days of roasting coffee in some plant in an industrial section of town, putting it into a box and shipping it to different points of distribution, hoping someone likes the look of your bag, are done.

large majority of coffee drinkers to believe that coffee can stay fresh for 8-10 months. Quick tip to these roasters… ‘The new-age coffee drinker is far more savvy than that’.

However, with the concept of ‘the more things change, the more they stay the same’ comes a new factor in the theme of evolution, a theme that has to stay in-step with the changing environmental ‘signals’ that now exist in our world, without impacting the romance and feel of what retro means to the marketing Gurus of today’s hippest brands. When the pour-over became popular once again, the simplicity of our beloved kettle was not under pressure to evolve, but the traditional coffee roaster was.

December 2014

Coffee roasting at a basic level is: highly polluting, with high levels of VOC’s (volatile organic compounds) being released during the roasting process, and consumes massive amounts of energy, thus producing CO2 at rates not found with most products we enjoy daily. A small gas-fired coffee roaster that produces 30 lbs. per hour consumes approximately 500,000 BTU’s per hour (including the afterburner), which is equivalent to 10 medium size BBQ’s running on high, hour after hour. Since the turn of the 1900’s, single-pass coffee roasters have not made any marked improvements in how they use the air that’s moved through the green coffee.

In fact, micro-coffee roasters use that so-called magic word ‘artisan’ to distract from the fact that their industry has not moved towards greener, and more sustainable technologies. Even worse, the manufactures of single-pass gas-fired coffee roasters want you to believe that improvements made to their highly consumptive afterburners are revolutionary, when in fact, the hotter an after-burner runs, the more GHG (green-house gasses) go up into the atmosphere. Until 2000, nobody thought to ‘close the loop’ on coffee roasting, which leads us to take note of one small Canadian company, Roastaire™ Canada, who has worked to pioneer a way to utilize the hot air (energy) leaving the roasting chamber.

The resurgence of the micro-coffee roaster, and their capability to provide real time freshness will run into barriers set by governments in the form of higher EPA standards. Coffee roasting emissions and energy consumption will be the Achilles-heel(s) of the micro-coffee movement because residents are getting protective of their air quality and how industry mistreats the air they breathe. California was once considered the toughest state in terms of emissions standards, even cars were manufactured to a whole different level in terms of their emissions system.

Now, all states and provinces in North America are paying closer attention to GHG emissions, and how much energy we consume in all aspects of our lives.

It will only be a matter of time until someone starts to pay attention to the amount of energy consumed in our daily cup before the hard questions start to get asked. In the meantime, take a few months to enjoy your local neighbourhood coffee roaster, because they will not last long in urban areas without at least a few complaints coming in, and when that happens the local government will be forced to act.

Consider it the price of emission.

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Office Coffee Service in Transition

by Dan Ragan Pod Pack International, Ltd

O

ffice coffee service (OCS) is in transition. Although this is not a new statement, OCS operators in the northeast United States can attest to the office product industry threat. W. B. Mason has successfully leveraged their customer relationships to add the break room vertical.

Office product dealers have offered break room products for many years, although most did not offer a comprehensive equipment program.

The transition is underway; some office product dealers now offer equipment, and compete against OCS operators around the country.

The office product industry becomes more competitive as wholesale clubs and Amazon provide more products, and dealers are looking for different ways to grow their business. The office product dealer has considered the break room a legitimate add-on segment to grow their business; however, they provided products, but not equipment. Approximately two years ago United Stationers, the largest wholesaler to the office product industry, stated: “Own the coffee, own the break room (paraphrased).” Owning the break room requires a free equipment program, so some office product dealers now offer free equipment and service. The office product industry has seen W.B Mason add a comprehensive coffee program, and grow their business substantially.

Verticals such as vending and bottled water companies have competed with OCS operators for many years. These industries understand the capital expense required to own the service.

Many office products dealers do not have a strategy for leveraging capital, but rather employ large sales teams and use sophisticated marketing programs, i.e. “the easy button”, “taking care of business”, “who but W.B Mason”.

Two reasons office products dealers penetrate OCS customers are price, and the buyer. So how do office product distributors offer such low prices, and what influences the buyer?

By considering the monthly office expenditure on all consumable products, and understanding the segment expenditure, the office product dealer has found a way to build their business.

Approximately 20% of an office’s expense is break room, and 80% includes remaining consumables. These numbers may be manipulated in many ways, and are provided as a baseline to understand pricing. As competition in the office product industry increases, the 34 dealers are seeking a competitive advantage

a national brand product becomes a legitimate purchasing strategy.

The office product industry becomes more competitive as wholesale clubs and Amazon provide more products, and dealers are looking for different ways to grow their business.

versus other office product dealers, not versus OCS operators. The method is to price the 20% break room segment at or below cost, to capture the 80% remaining consumable office product segment, and provide coffee equipment and service at no-charge.

OCS operators, in many cases, believe Office Product companies cannot provide the required level of service to keep the business. Staples revenue in 2003 was 11.6 billion, and by 2013 increased to 24.3 billion. Was the increase at Staples due to poor service? Perhaps the service is acceptable and the company employs good marketing and sales people, although the vertical strategies employed may be more complex.

Office product dealers have become legitimate competitors in the office coffee segment, and OCS operators need a strategy to compete. Some strategies require new or different products that must be sold to the buyer.

The end-user buyer is ultimately interested in convenience. The buyer may be a facility manager, office manager, administrator, or receptionist. Too often the buyer does not drink coffee, and an appeal to quality of product is not a selling point. Because the buyer does not drink coffee, the sale is now based on cost, and ease of purchase. However, the buyer also has an obligation to provide a product acceptable to the rest of the office population. Therefore, using

December 2014

Too often a salesperson is faced with a priceonly strategy because of a proprietary product, although the selling strategy should have a quality story. Scheduled coffee tasting continues to be a successful OCS method to prove a quality product. The on-site tasting allows an operator to display national brands, locally roasted coffee, and private labels in the format the customer wants. The strategy for the operator is to exploit their industry expertise, and differentiate themselves from other suppliers. To be clear this is a selling technique, not a pricing strategy.

Additionally, a successful tasting strategy is embraced by owners, managers, and employees of OCS Companies.

Many opportunities exist to be educated in coffee, and to understand the competitive advantage an OCS company offers. The industry continues to innovate, and differentiating products are available to operators. OCS managers should spend an adequate amount of time at trade shows and educational seminars as part of their strategy. Many shows are available throughout the year, and are typically in a tourist destination, so attendees can unwind. Choosing a show to attend should be based on relevance to the operator’s goal, and will provide maximum success if attendees have targeted vendors to visit. Office Coffee Service is in transition; take advantage of the opportunities!

Dan Ragan

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Keeping up with Industry Demands A One-Way Street

by Alma Likic Plitek, Llc

T

he coffee industry has experienced a significant shift in the last decade. Not only is the industry being affected more and more by the impact of climate change, but there is also a notable shift in consumer demand and preferences. Consumer demands have been increasing exponentially as consumers are looking for more premium coffees and are no longer satisfied with just a hot beverage but are seeking a distinct taste. Coffee companies, in turn, are focusing on providing a “coffee experience” when offering premium grade coffee. Coffee companies address this demand in a number of ways; by sourcing premium grade coffee, providing a combination of consumer desired blends, and packaging and providing the single serve option. Each can be equally important to the consumer in providing a great coffee experience. A roaster can have the most appealing packaging, but it’s the coffee content that will keep consumers returning for more of the product. At the same time, if coffee freshness isn’t present, repeat orders will diminish.

In order to provide the freshest coffee possible and preserve the quality of their coffee, coffee roasters pack and seal their coffee immediately after roasting in a package that has a one-way degassing valve.

As freshly roasted coffee cools, it releases carbon dioxide gas. The degassing process can last up to a week depending on the roast as well as other factors. Without the proper mechanism in place to release the carbon dioxide, degassing coffee inside of a sealed package will cause the package to swell and potentially burst. Freshly roasted coffee can be bulk degassed; however the problem with this approach, in addition to tying up inventory and time, is that environmental oxygen and airborne contaminants cause the coffee to rapidly lose its freshness and quality taste.

The solution is to use one-way degassing valves that are placed on coffee packaging. The purpose of one-way degassing valve is to allow carbon dioxide gas from freshly roasted coffee to escape from the packaging while keeping environmental oxygen and contaminants from coming in.

The direct benefit to coffee roasters is giving them the ability to package freshly roasted coffee immediately to enable and enhance preservation 36 of quality. Additionally, not having to bulk degas

The direct benefit to coffee roasters is giving them the ability to package freshly roasted coffee immediately to enable and enhance preservation of quality.

decreases time to market and production costs.

PLI-VALV® patented one way degassing valves vent roasted coffee’s natural carbon dioxide gas from sealed packaging while providing an effective barrier to degrading oxygen entering the package. PLI-VALV® products afford the coffee roaster a competitive advantage by preserving freshness and ensuring the highest level of coffee quality while also increasing production throughput and eliminating degassing hold time for significant cost savings.

Valves also enhance the aesthetics of coffee package by virtually disappearing into the graphics, offering flexibility in valve placement location. Its flexibility eliminates the heat-seal scarring and exposed vent hole required by traditional molded valves as well as increasing line speed.

One-way degassing valve technology has developed immensely. It has evolved to include various enhancements that improve product functionality and ease of use. Roasters prefer to have smaller, thinner transparent valves that will not interfere with product packaging and provide the lowest oxygen levels possible. In other words, one-way degassing valves should perform the function but be as unobtrusive as possible. Plitek has continuously worked towards enhancing performance features of one-way degassing valves over the last twenty-five years with great success.

effectiveness and help with product freshness and quality preservation. Its carefully designed structure inhibits coffee grounds from entering the valve and interfering with its functionality. It is one in a line of many product generations that help roasters provide the best quality coffee to their customers.

As a response to industry demand for single serve, Plitek developed PLI-VALV Mini Valve; a one-way degassing valve for fractional packaging. The new valve is transparent and compact, at 0.50”x 0.50” in size, with significant cost advantages over standard size valves. The applicator for the new PLI-VALV Mini Valve can apply up to 150 valves per minute. A custom engineered option is available to double the rate.

As coffee industry demands and consumer preferences are changing, all of the industry players are shifting along. Producers are doing everything they can to protect their crop, roasters work on continuously offering great quality coffee demanded by the market, and packaging companies offer innovative packaging solutions. The addition of an effective degassing valve adds the security that all this effort to provide the best coffee to consumers is not spoiled by the effects of oxygen on roasted coffee.

Plitek continues to develop cutting edge solutions for the coffee roasting marketplace, from faster, more streamlined applicators with features like valve detection, automatic splicing and oil detection, to improvements to the valves in areas like increased adhesion and improved valve functionality, all of which will aid roasters in providing premium, great quality coffee.

One of Plitek’s patented innovations recently introduced to the market is PV-25-FV; a one-way degassing valve with an integrated filtering base that will additionally enhance valve

By Alma Likic, Plitek

December 2014

Tea Sales on the Rise Infusing Your Business

by Stefanie Makagon Garden to Cup Organics LTD

I

spend a decent part of each day researching all things relating to the tea industry.

One thing is certain: the challenge is not in finding information, but in converting an overload of information into useful strategy and staying current in an industry where growth and change seem to be occurring at warp speed!

Statistics on the growth of tea sales and rising consumption are everywhere, punctuating countless articles with forecasts predicting that the demand for tea will continue to grow, fueled by increased health awareness and new product offerings. In short, the call for businesses to take notice is getting progressively louder and louder.

In response, the specialty tea industry in North America has exploded. What we are seeing in the tea sector as the competition increases, is the bar being raised across the board in areas such as product innovation, quality, environmental awareness, and commitments to consumer health and wellness. Distinctions that were not so common a few years ago are rapidly becoming the new standard: loose leaf, specialty, organic, non-GMO, directly and ethically sourced.

It’s a wonderful thing to see consumers benefiting from this growing selection of ethical and quality products and new and existing tea companies are profiting from increased demand.

However, it is not only the tea businesses and consumers who are benefitting. For example, coffee roasters, natural health industries, and food service industries are also positioned to profit from tea’s rise in popularity as tea continues to be added to menus, food and drinks, and health and beauty products.

While facts and figures on growth and trends in 2014 are abundant and compelling, what is not as obvious is what real advice exists for businesses looking to participate in the growth of the tea industry in 2015 and beyond.

I asked the Principles at Garden to Cup Organics to offer additional insights on what the right tea partner can do for your business, as well as how to evaluate a tea company as a potential partner.

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Dave Diogo, CEO, Garden to Cup Organics: “Adding tea to your product mix while maintaining your core business becomes a differentiator to your customers and increases both loyalty and purchase size, when done

without sacrificing quality and service. Bringing on a tea partner can be one the most effective ways of accomplishing this.”

market by partnering with a supplier who is committed to uncompromising quality, technical sophistication and organic tea.”

“There is always a risk in bringing on new products into your portfolio. A true tea partner recognizes this and has a strong understanding that their own success is entirely predicated on the success of their clients. As such, they will work with you to understand your business and your clients to ensure that the tea program they develop with you will be a success.”

“Organic should not be considered a buzz word.

Organic agriculture promotes the sustainability of the environment and the health of everyone who farms and consumes the products.”

“An excellent tea partner will understand how the market is evolving and how consumers, and most importantly, your customers, are choosing their teas. So, look for a tea partner that provides a commitment to collaboration and innovation to provide your customers the best selection of teas and accessories to compliment and enhance your overall brand.”

Raj Teja, President, Garden to Cup Organics “IBISWorld identified four important key success factors in the tea industry. I would say this criteria is bang-on when evaluating a potential tea partner: 1. Product differentiation Building your program from a wide selection of organic single origin teas, award-wining teas, exotic blends, wellness and functional teas, which are ethically and directly sourced, will allow you to differentiate yourself from your competition.

2. Ability to adapt to change A tea partner should be able to anticipate and adapt to changes in the tea industry and consumer preferences in a timely manner to ensure that you can stay current to your customers.

3. Supply contracts in place for key inputs Ensuring that your tea partner has reliable contracts with their suppliers will reduce risk and volatility.

4. Economics of scale and scope From there, it comes down to supply chain.

As competition increases, finding a tea partner with a reliable, sustainable and scalable supply will become increasingly important.”

Greg Lui, Tea Master/Tea Blender Garden to Cup Organics “My passion is tea. I’m excited to see tea gaining popularity in North America. I will always advise those looking to add tea to their mix to cut through the crowded tea

December 2014

“Organic quality should start at the plantation level and a partner that offers plantation-direct organic teas will not only have better control over their supply, but also quality. It’s not good enough to simply purchase from a plantationdirect supplier. I would want to know that my supplier visits the plantation of every product that they purchase. When products arrive to their facility, each pallet should be inspected and every sample taste-tested and subjected to a full microbiology screening from a government accredited food laboratory when required.”

“There is an art and science to both sourcing and blending teas to deliver consistent quality, aroma, and taste for the new and astute tea consumers. A tea partner should commit to delivering all of these things, so that you can focus on your core business.”

World Tea News forecasts the emergence of 8,000 tea-specific retail outlets in America by 2018 (in 2003 there were only 1,000). Yet, much of the growth in sales is expected to come from coffee retailers and other business that are willing to expand their offerings to meet changing consumer demands.

For businesses looking to participate in this growth, industry experts advise seeking out a tea partner who will become an extension of your business and guide you towards profits.

Here’s to the year ahead!

Stefanie Makagon, Director of Brands Garden to Cup Organics

Is Our Current System Sustainable?

Addressing Vulnerabilities to Our Industry

A

s I was sitting in Brazil having breakfast with some new coffee friends, one of them asked, “Marty, how did you get started in Coffee?”

Well it’s kind of a long story. But if we go back to the late 60’s early 70’s, I was down at the Pike Place Public Market and the piers to just mess around for the day. Well, I walked into a place on the piers called Wet Whiskers and they had an old John Deere Royal Roaster. Some great ice cream, too. As we were waiting for our ice cream, they were roasting some coffee. As I walked away, I remember looking back at the piers and it looked like it was on fire, with smoke billowing from it. This was because they vented their roaster downward below the pier.

Move forward about 6 years to late 1977, when I was discharged from the USAF. I came back to Seattle to visit family before heading to Oregon to finish my schooling for Electrical Engineering. Well as things turned out, I decided to go work with my Dad. He was working on installing gas lines for a company called Starbucks. As I was helping put the gas lines in, a Semi pulled up and on the outside it was marked scrap metal/junk. So Jerry Baldwin, Gordon and Zeb were standing there like little kids waiting to open the container. Once it was open I asked them what it was. They then informed me it was a German-made coffee roaster and that they were going to put it together. As we talked, I found out that they had no one to assemble the roaster, or drawing or diagrams. So I spoke up, “I can do it!” Six weeks later we had a running roaster. Now, it may have not been 100% correct, but it was turning and getting hot. So over the next few years, I worked in Starbucks’s roasting plant building roasters and silos and a way to flavor coffee using a unique turntable system, among other things.

As I worked more and more in the coffee industry, I was continually running into people who just wanted good coffee. Then I was asked

by Grady Saunders of Heritage Coffee to give a course in air pollution. So I started doing some courses for the SCAA. As I volunteered, I met a great bunch of people trying to do the right things for the industry for the right reason. As we started to move the Specialty industry to mainstream coffee, it became necessary to build consistency and reproducibility so we could help standardize processes to speak and work

by Marty G. Curtis Just Quantify Coffee Academy

Has coffee gotten that much better?

Or have we just been doing a better job of sourcing the coffees?

Perhaps a combination of both?

worldwide in a common language. So the SCAA started the Technical standards committee, of which I am a member. The thing that most intrigued me was the openness and willingness to share on the issues we have.

consumers have for sure, as we now have better coffee. The Roaster and Retailer have been hugely economically compensated. But has the farmer realized economic benefit similar to the retailers or roasters? I’m still not sure they have.

I believe the farmer will not realize the gain until we actually have programs for the farmer on truly evaluating their coffee from seed to cup. This gives farmers tools so they can truly evaluate the coffee on their farms. There have been programs to help, but they are limited in their funding and availability, as well as a clear course of learning. We currently teach them to cup coffees from around the world and not what their coffee truly can taste like. Maybe it’s time we build a program for teaching farmers how to taste their coffee, and what the defects of improper processing or handing will taste like.

We still need to work with the brokers, roasters, retailers and consumers to help them understand that pricing needs to be fair throughout the supply chain. I still hear successful businesses in the coffee industry remark about the cost of green coffee today, yet it seems their profits are soaring. Can the Specialty Coffee system truly survive without the proper distribution of knowledge, wealth and sustainability?

As I grew in the coffee industry I tried to do the same. Which brings me to the actual coffee we are getting today. Has coffee gotten that much better? Or have we just been doing a better job of sourcing the coffees? Perhaps a combination of both? As a young person in coffee, I was mainly working with roasting equipment. But the more I worked with the equipment, it became very clear I needed to learn to taste the coffees so I could better understand what a person wanted their roaster to do. So as I grew in the industry I have seen a lot of changes in roasting levels, styles and processes. But the coffee we are getting today is quite different than 30 years ago. Some of this is possibly due to the way the farmer now picks their coffee more selectively. I’m sure it’s partly due to the way they have learned to process the coffees. Some change has come from their ability to identify the differences in the micro-climates on the farm, and better husbandry.

But who has gained from all this? The farmer, retailer, wholesaler, or consumer? We the

40 December 2014

Marty G. Curtis

Meeting the Challenges Ahead New Jumps from Solid Ground

by Bill Murray National Coffee Association Of USA (NCA)

D

espite all the uncertainty in the global economy, the world of coffee – at first glance – appears to be on a steady and solid footing.

The NCA’s 2014 National Coffee Drinking Trends report shows that consumption in the US, the world’s largest consumer market, is essentially steady, but strong. Against this backdrop the single serve format continues to grow and drive opportunities. Ever better, younger generations of coffee drinkers have embraced coffee and café culture as never before, boding well for the future.

But looking more closely, it is clear there are challenges ahead: climate change has the potential to affect supply, even as greater global demand is requiring increased production. The volatility of coffee prices in the commodities market seems to have increased this year. New and emerging formats are vying for attention and a place in consumers’ kitchens, and coffee is under increasing scrutiny from regulators.

Some of these challenges – for example pricing and the adoption of new formats by consumers – are driven by market forces, and are inappropriate for discussion among industry competitors. Other challenges – such as addressing regulatory issues or making the industry more sustainable – are the kinds of things that can be addressed on a collective basis, and often the NCA is the forum through which these matters can be confronted.

For this reason, the NCA has taken a fresh look at itself – mindful of the industry’s current and pending challenges – and has begun a process of change. This process started with a “Think Tank” in June 2014 of industry leaders to discuss current trends and how the NCA could best address the industry’s most pressing needs. Over the course of two days participants engaged in a facilitated discussion from which emerged four top priorities: •

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Advocacy. We are strengthening our advocacy efforts on behalf of the industry, whether with government, media, the public, or other audiences. We’ve also strengthened communications to our members through new “Member Alert” communiqués – single topic reports on breaking issues – and developed a new “Coffee Reporter Weekly” digest, which curates industry news and features every Friday.

Caffeine has been under greater scrutiny in 2014, with energy drinks and powdered caffeine creating new behaviors in consumers and tripping the government’s radar.

•

•

•

Science. The NCA is amplifying the prominent role of the NCA Scientific Advisory Group (SAG) which is comprised of expert food scientists, toxicologists, epidemiologists, and botanists, leveraging their expertise to ensure that the NCA’s positions on coffee, science, and health are firmly grounded in facts, research, and expert opinion.

Sustainability. We’ve convened a crosssector task force to look more closely at sustainability so that the NCA can reinforce and sharpen its focus on a critical topic that impacts everyone in the supply chain. The first step: determining the NCA’s role on this key topic.

Certification. To better identify and encourage industry talent, we’re assessing the certification landscape to determine how best to plug existing gaps and support special skills in areas where programs currently do not exist.

which we anticipate starting in 2015. The website redesign will improve the user experience, as well as result in a “responsive site design” which will be more user-friendly to visitors from mobile platforms.

So what does this mean as a practical matter?

Caffeine has been under greater scrutiny in 2014, with energy drinks and powdered caffeine creating new behaviors in consumers and tripping the government’s radar. We’ve gone on record with the FDA to argue that caffeine as typically consumed in coffee is safe, as tested in the lab and over time. We’re continuing to work with industry counsel in support of the industry’s defense in Proposition 65-related litigation in California. We confronted – and obtained a retraction – earlier this year in response to a misleading article implying that consumers’ coffee could well be tinged with sticks and twigs. And, as new regulations continue refining compliance with the Food Safety Modernization Act, we’re recommending changes to proposed rules to reflect the reality of your business.

Yet even as we’re changing, one aspect of the NCA remains the same, and would even now be recognized by Julius J. Schotten, who served as the NCA’s first president 1911: we remain led by experienced, passionate and committed industry leaders, and are dedicated to serving and protecting the common business interests of our members – whatever the future may hold.

At the same time, we’re in the process of ratcheting up our infrastructure and capacities.

We’re expanding our social media presence (with a new Linkedin Group, for example); have installed new media monitoring capacities; and are upgrading our internal and external technologies, including a state-of-the-art “Association Management System” (or “AMS”) to support new levels of internal data reporting and analysis; member support; and industry service.

On this enhanced technology base, we’ll be able to incorporate advanced technical standards and functionality in a redesigned NCA website,

December 2014

Bill Murray President & CEO National Coffee Association

速

Where Are We Now? Preserving Specialty Coffee

by Timothy J. Castle Castle & Company, Castle Communications

I

n asking ourselves where we are as an industry today, we necessarily have to question where we were before and what is different now. The things that have not changed, in the fifty years or so that I have been drinking coffee, are some basic questions: Who needs good coffee? Who could really use a good cup of coffee? Who would really, regularly, appreciate a great cup of coffee? What could stop a dedicated coffee farmer from catering to those requirements?

What has changed, however, are the things that might get in the way. After fifty years of slowly raising the expectations of coffee drinkers, the specialty coffee industry faces several grave risks that emanate from forces and conditions that dwarf the plight of any one coffee peddler.

The chief long-term threat to the specialty coffee industry is climate change due to human activity. Coffee farmers, even those who were not even aware that such terms as “Global Warming” and “Climate Change” existed, have been dealing with the effects of climate change and anticipating more for years. These coffee growers, many of whom have not even been to the equivalent of high school, have been working on these projects for well over ten, and in some cases twenty, years.

Coffee has been identified as a potential economic lifeline for millions of people around the world. Hundreds of economic aid programs now extant are built around assisting coffee farmers. Such organizations, mostly NGOs, depend upon the work of supporting research and training organizations including the Coffee Quality Institute [http://www.coffeeinstitute. org], the World Coffee Research project [http:// worldcoffeeresearch.org], and others. This is in addition to the increasingly sophisticated work of the national laboratories that exist in Brazil, Colombia and Costa Rica, among others.

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Concomitantly, direct aid is being provided to farmers at the most practical levels. This is being done in Antioquia by providing intensive training for the region’s most promising young coffee farmers and “New Generation Coffee” camps for young people, while mobile coffee labs and training facilities have been allocated to serve more remote farmers. Additionally, a vibrant effort has been established to promote domestic consumption of high quality coffees, which allows farmers to domestically market their coffees independently. The results of these

programs are important because the specialty industry faces a supply risk that overlays the perils of climate change: As food prices escalate, many farmers will find alternative crops that yield significant return for far less effort and risk, especially within the context of climate change. If the supply of fine specialty coffees is to be found down the line, it’s likely to be much more expensive than industry members or coffee drinkers expect. So while higher prices can ensure the likelihood of continued production, they obviously do not ensure that coffee drinkers will want to pay those high prices. As an industry, those of us who are in the business of selling specialty coffee need to start preparing our customers for much higher prices that could present themselves as early as the end of 2015.

The Colombian Coffee Growers Federation has provided assistance to coffee farmers throughout the country for years, although the programs have been general in approach and the resources offered are designed to apply to a wide audience of coffee farmers. Other government or quasi-governmental agencies have consistently supported and represented the efforts and needs of coffee farmers over the years.

In other origins, a continued lack of transparency, and commitment to corrupt practices at the highest levels of some producing countries’ ruling classes constitute another threat to the vibrant production of higher quality coffees. Unless farmers know that they themselves will be benefit directly from a commitment to quality, the overall quality of a given country’s coffee will obviously decline.

The risk of alternative production is one thing, but the risk of no production at all due to farmers deciding to cash out of their properties is another concern of government officials.

As an industry, we need to ensure that coffee farmers continue to be motivated and have the tools to stay the course and remain focused on producing better coffee for coffee drinkers. We can do this by supporting the many programs mentioned herein or ones like them, or by simply developing direct relationships with farmers.

December 2014

The Pernicious Best Coffee Speaking of the “best” coffee, one last threat to the vibrant and dynamic health of the coffee industry needs to be mentioned: that is the expectation on the part of consumers that there is a single “best” coffee out there waiting for them. Coffee drinkers, and the specialty coffee industry, will be much better off when they come to understand that there is no one “best coffee,” but an increasingly better variety of exciting coffees from all over the world. Roasted by a wide variety of dedicated specialty coffee roasters, they can bring an incredible array of specialty coffees from an increasingly deep selection of roasts and origins.

It’s true that many specialty coffee drinkers will find a favorite coffee they will always return to, but by educating coffee drinkers to the variety of coffee and roasting styles available to them, they not only drink more coffee, but they might even come to appreciate their favorite one even more.

Timothy J. Castle, Castle & Company, Castle Communications

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Customization in Coffee Industry Fosters Need for Short-Run Label Printing

by Amber Jechort Primera Technology, Inc.

M

ass customization has been a key driver in one of the largest bursts of innovation in the digital age. What was once standard issue is now open source.

Consumers are personalizing everything from sneakers to fragrances to coffee mugs, and the trend shows no signs of slowing. Businesses that can capitalize on this new era of microsegmentation – and do it profitably – are poised for success.

Couple the customization trend with an everdiversifying and adventurous consumer palate, and set it all against a backdrop of a burgeoning industry of hyper-local, single-source growers.

It’s clear: Decision makers in the coffee and tea business are uniquely challenged to balance a singularly satisfying product experience with the practical realities of running an enterprise in order to meet a lengthening menu of customer demands and captivate loyal customers.

Compact, cost-efficient label printers enable small to medium roasters and converters to print and apply package labels in adaptable, customized batches, rather than large industrialsized print runs.

Trend-setting independent coffee and tea entrepreneurs are adopting label technology to better serve their customers, expand their assortments, embrace new partners and give themselves a leg up on the competition.

Minneapolis’ Peace Coffee has been leveraging Primera’s label printing technology for over two years. “We knew we would be offering more limited runs and shorter term seasonal coffees, so we started shopping around for solutions,” said Jon Katzung, Director of Operations for Peace Coffee. “We were really looking for something to increase the flexibility of our production.”

Peace Coffee decided to invest in Primera’s LX900 printer, which has afforded them much greater agility, and the ability to adjust quickly to changing market conditions and consumer tastes. Using the printer has reduced overhead and inventory costs, and has virtually eliminated label scrap, underscoring the company’s commitment to the environment.

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Moreover, Peace Coffee says they can now entertain working with small growers they wouldn’t have been able to partner with in the past. Like many small roasters, their mission is

rooted in fair trade, community-building and sustainability, so being able to act immediately on emerging opportunities is a strategic imperative.

Now that they are no longer constrained by large print runs, an increasing number of customers are using custom label functionality to open blue-sky expansion for their businesses. Coffee and tea purveyors can cost-effectively offer packaging with corporate logos for gift baskets, or labels emblazoned with a couple’s photo for wedding favors. New marketing alliances abound, with opportunities to cross-promote other local businesses and restaurants with special limited edition blends, or to assist with fundraising or cause marketing for likeminded charitable organizations in their own communities and beyond.

repeat visits and basket-building at the register by continually offering new items on a shortterm basis. Although SKU proliferation can be risky and hard to manage in a traditional print environment, a new label printing technology mitigates the risk of scrap and carrying costs associated with packaging overstock.

With so many choices in the coffee marketplace, being nimble, running lean and offering distinctive products can be the difference makers in the success of a small business. Short-run label printers allow entrepreneurs to achieve these ideals by freeing them from the confines of traditional print services and giving them room to customize their operations to best suit the needs of the business they envision.

And of course, the label is valuable real estate to use for communicating the narrative of the growers. With consumers around the globe actively engaged in seeking information about the sources and safety of the food supply chain, each package can tell a specific story about the person and the place where the product originated. Consumers appreciate authenticity, and the emotional connection these stories establish between consumers and the brand will build customers for life.

Variety is another lever for consumers to stay engaged with a brand, especially in the beverage sector. Beverage consumers are notably promiscuous and willing to try new tastes and sensations. A roaster can encourage

December 2014

Amber Jechort, Product Manager, Primera Technology Label Printer Line

Watch the case study: www.primeralabel.com/Peace_Coffee

for something to increase the “ We were looking flexibility of our production. ” When Jon Katzung, Director of Operations for Peace Coffee, Minneapolis, Minnesota, was looking for a way to increase the flexibility of their production, he turned to Primera’s LX900 Color Label Printer.

“We knew that we were going to be offering more limited run, shorter-term coffees in the next couple years so we started shopping around. We were looking for something to increase the flexibility of our production and the LX900 was the best fit.”

www.primeralabel.com | 1-800-797-2772 | 763-475-6676 ©2014 Primera Technology, Inc. Primera is a registered trademark of Primera Technology, Inc. All other trademarks are the property of their respective owners.

The Graying of Coffee Farmers Demographic and Societal Changes

by Paul Kurtz Hemisphere Coffee Roasters

M

any busy Roasteries have a core business plan of insisting on buying good-quality coffee as inexpensively as possible. Contracts with customers are secured, and prices are set, based on the cost of green coffee. A broker may, to gain a customer, call and offer a green coffee for a bit less than what you are currently paying. If the moreexpensive coffee can be substituted with a coffee of lower price and grade without negative notes in the cup, many roasters will work it into their blend or offering. I am not against making a profit and, indeed, none of us will be in business long if we don’t. But have we ever stopped to think about how that statement would sound to a coffee farmer? Outside of Matagalpa, Nicaragua, where I have been buying coffee for the past eight years, there are farmers who are spinning their wheels, virtually going backward each year, unable to make a profit. Hundreds of farmers, who for many years have not seen a profit, struggle to stay afloat. They literally “owe their soul to the company store.”

other societal ills into the community, as these men may have a separate life in the city that’s often never talked about or acknowledged.

Our insistence on low prices is at the heart of a social change happening across coffee-producing lands. I have witnessed it firsthand in Central America, South America, East Africa, and Northern Thailand. There are three significant changes I have seen in the past 12 years buying, importing, and roasting coffee.

At the core of these societal changes is an incorrect assumption concerning the production of high-quality coffee – that coffee is just coffee.

Coffee is a commodity and, as a commodity, its value is based on supply and demand. Corn from Iowa is no more valuable than corn from Ohio. Corn is corn, right? Yes, in my opinion, it is. (However, a corn farmer may disagree with me.) But coffee is not just coffee. All coffee is not equal in value to the roaster and thus is set apart from other commodities. Everyone in the coffee industry knows this. Michael Sivetz, in his unromantic treatise on coffee, Coffee Quality, wrote that there are more than 100 separate, verifiable steps that farmers take to produce coffee, from the nursery to the loading dock. If just one of those steps is missed or goes wrong,

1. Gender shifts - Fewer men are on the farms today. They are in the cities earning a living, leaving the women and children on the farm to work the coffee plantation. I’ve seen this in the little community of El Tuma, Nicaragua.

Producing high-grown coffee in these rugged mountains is hard work. Families struggle without the men involved, but they get it done.

This rural-to-urban gender shift introduces

2. Graying population - Young people, seeing how hard their parents have worked only to be deep in debt, want nothing to do with this life.

Opportunities to get off the farm and go live in the cities are sought and seized. Parents see education as the ticket off this treadmill, and they sacrifice much to get their children to the city to develop academically. These kids never return.

3. Land use - In the Central Plateau, outside San Jose, Costa Rica, are large tracts of land covered in concrete supporting housing developments, malls, and retail outlets. Just four years ago, some of the best coffee in Costa Rica was grown there. This land will never go back into coffee production and is lost forever. Real estate has more value for building than it does for producing a fluctuating commodity.

the cup can be affected, slightly or significantly.

Buying coffee as inexpensively as possible is not compatible with the desire for quality coffee, where farmers must be rewarded for their hard work. If there is no value or incentive added for labor, why continue to add it?

Although complicated, the answer is not impossible to find. Direct trade, based on long-term relationships of mutual respect and understanding, is a principle I believe in. I need the farmer and he needs me. We each have a face, a name, and a life. My life is no more valuable than the farmer’s. If I must make a profit to survive, so does he. Coffee is people and, in the end, people matter. I believe these societal shifts can be corrected by truly valuing the coffee for what it is. It is the fruit of someone’s labor. As long as we turn a blind eye to who grew this great coffee, we can buy it cheap and pass it off to our customers. But by having a direct relationship with those growers, looking out for their welfare as rigorously as I do my own, I am not even tempted!

Paul and Grace, the owners of Hemisphere Coffee Roasters.

Diego Chavarria, the owner of the Nicaraguan farm Paul imports from, holding harvested coffee beans.

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Beans being sorted in Thailand.

Nicaraguan farm workers harvesting beans (most are women).

December 2014

Paul Kurtz, owner Hemisphere Coffee Roasters

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Devastating Emily

Combating Coffee’s Deadliest Enemy

by Donald Schoenholt Gillies Coffee Co.

T

he coffee borer is a severe pest, but it can be managed to the level where it is merely a pest, and is no longer the threat it was a century ago. In 1869 a previously unidentified fungus struck the coffee plantations of Ceylon, one of the great coffee origin lands of the 19th Century. In a very few years the blight known by colonial English planters as “Devastating Emily”, and later its scientific name Himileia Vastatrix, destroyed the coffee economy of the Island. Ceylon’s coffee never recovered, and in time it was replaced by planting tea. The disease, which appeared in various other coffee producing lands in Asia and Africa over the next 100 years, was believed to have effectively been kept out of the coffee nations of the Western Hemisphere through a quarantine provided by the world’s oceans, but 45 years ago, in 1970, the blight, possibly carried by wind, appeared in Brazil. An isolation area was created around the affected farms and their trees were destroyed, but within 18 months the invisible pathogenic agent jumped the blockade, possibly carried by the prevailing winds. Similar fencing efforts have proven unsuccessful elsewhere, and so attempts to contain the scourge have morphed into labors to manage the disease.

With its introduction to the Americas, the scourge picked up new names, “La Roya,” and “Roya del Cafeto”, “Roya” for short. It is also active in Jamaica, felling 24% of the Blue Mountain crop.

Rust disease arrives unnoticed, transported on the wind or through the interaction of the coffee leaf with other organisms that may have come in contact with the fungal spores. The stealth-like onset of the disease is part of what makes the scourge so difficult to handle. The parasitic spores only live in a temperature range of 21°C (69.8°F) and 25°C (77°F). The spores like moisture, and prefer mature rather than young leaves. Roya manifests itself first as spots that grow into blotches on the underside of leaves.

The blotches multiply; the leaves die back and fall.

We have seen the good effects that programs such as the Smithsonian Bird Friendly and Rainforest Alliance have done in support of the Central American rainforests, and coffee agricultural diversity. Some say that Roya is easier to manage when coffee is grown in sunlight as the plant leaves dry faster in sunlight, and the fungus breeds in moisture. Spaced rows

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of trees, it is pointed out, are easier to spray with anti-Roya agents. From other quarters we hear that shade-grown coffee protects the trees as the canopy prevents dew formation on the leaves, which lessens the opportunity for spread of the disease.

Coffee is a highly politicized crop. As The American Phytopathological Society (APS) points out in its excellent report on Rust Disease, http://www.apsnet.org/edcenter/intropp/lessons/ fungi/Basidiomycetes/Pages/CoffeeRust.aspx “In general, sun-grown coffee is produced on large, well-capitalized farms that can afford to control the rust with fungicides, the cost of which is offset by the higher yields. The small, “low-tech” producers tend to favor shade-grown coffee, which, despite its lower yields, requires less external input in the form of pesticides and fertilizers.”

Protective action on healthy plants has emerged as the method best suited to holding back the onset of Himileia Vastatrix. There are no records of it menacing other vegetation.

Bernhard Rothfos, in his exceptional book, Coffee Production, explores the cultural work that needs be done in defense of the trees.

Scientifically, it appears that wider spaced trees, a dryer leaf environment, good ventilation, and good pruning and weeding practices all contribute to healthier, less susceptible trees.

Spraying the leaves from below with fungicide can be therapeutic, even curative. But that does not mean that shade-grown coffee need be abandoned. It is just another challenge that shade farmers and organically certified farmers must face in their efforts to bring certified coffees to market.

Coffee destruction has social as well as economic consequences. The Coffee Trust reports that Guatemala, Honduras, and El Salvador have declared Coffee Rust a national emergency.

Where the coffee economy fails, farm families are at risk of turning to coca as a cash crop.

This leads to dealing with dangerous people; increasing risk from violence, and leading to the family’s potential servitude to drug interests. Coffee means economic freedom to a smallholder, and farmer, and efforts must be made to maintain the sustainability of the coffee economy of farm families.

Poor farming practices play a role in making coffee susceptible to Roya. In a

December 2014

recent fundraising letter to The Coffee Trust stakeholders, Bill Fishbein noted “There is no doubt that climate change is playing a role, but so is a lack of organic farming knowledge.

This has led to resource-depleted soil and a gene pool lacking diversity which has exposed coffee’s jugular vein to La Roya’s sharp edges.”

The Coffee Trust is working with a group of 460 farms in the western highlands of Guatemala using Campesino a Campesino teaching methods, helping the farmers to learn soil replenishment methods to defend the plants against Roya.

According to the USAID, as reported by Reuters, “The blight is jeopardizing the livelihood and food security of about 500,000 people who make their living in the coffee industry, especially small farmers and seasonal workers.” In response to the threat, USAID has partnered with Texas A&M University’s World Coffee Research in an effort to develop rust-resistant coffee varieties, and “increase the ability of Latin America’s coffee institutions to monitor and respond to outbreaks of the blight.” According to the Reuters report the USAID commitment to challenge coffee rust is now $14 million.

We must be mindful that a farm family at risk is always at risk. If people of good will and the resources to help turn away when the crisis is past, a new crisis with all its ugly consequences will appear just around the next corner. Manere Vigilemus. We must remain “Ever Watchful”.

For information sources, see our article on the web: magazine.coffeetalk.com/december14-devastating-emily/

By Donald Schoenholt, at Gillies Coffee Company, celebrating its 175th Anniversary in 2015. coffeeman@gilliescoffee.com

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The Danger of Hype Over Quality

by Rocky Rhodes International Coffee Consulting Group

D

o you remember when “Gourmet” meant something good? How about the term, “The Best”? If you see either of these things you are for sure being sold something that isn’t either one.

So now look at the phrase, “Specialty Coffee”.

This is even more difficult because no one could define it in the first place so now everybody’s coffee is ‘special’. To some it means a Pumpkin Spiced Latte with a beautifully designed rosette on top. Frankly, it means whatever the marketing department wants you to believe it means.

The demise of these words and expressions is due to hype taking the place of quality when discussing a product; in this case, coffee. This happens because there is no way to prove a claim false. If the coffee shop owner thinks his coffee is the best, then he markets “The Best” coffee. At least it is to him so you can’t really prove he is wrong. But if the shop across the street also sells the best coffee, isn’t somebody wrong?

All the hype causes confusion for the customer.

The consumer is less likely to part with larger dollars for something if she feels she is being duped by advertising. When this happens, it has the potential of decreasing the value of actual great coffee and can run down the supply chain. Imagine a progressive coffee farmer getting damaged for doing the extra work needed to export a 90+ coffee but the marketing departments degraded the trust of the consumer.

In 2015 this problem must be addressed more completely. The solution has started, but many don’t know it. As with most questions of ambiguity, a standard to which you define something must be created so legitimate comparisons can be made. This standard exists for half of the supply chain; from farmer to roaster.

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The standard for Arabica coffee is the Q-System of the Coffee Quality Institute (CQI) and the Specialty Coffee Association of America (SCAA). It is a standard that allows participants in the transaction of green beans to judge, reward, punish and discuss the qualities of any given lot of coffee. If you are in the green trade, you are either a Certified Q-Grader already, or at least you should familiar with the system. It allows a far more objective look at the attributes of a lot of coffee and is a key in the efforts of price discovery. It helps define quantitatively the value of the coffee.

The consumer is less likely to part with larger dollars for something if she feels she is being duped by advertising.

Is this a perfect system? Of course not! But it is the most perfect one we have for the job; defining the standards to which all coffees can be judged.

Starting in 2015 there will be over 4000 Q-Graders in the world spanning most producing and consuming countries. This now has the “critical mass” of participants to make this the standard methodology for grading green coffee lots. But there is an important part of this industry solution missing.

This will be the challenge for 2015: Creating a final product scoring system, developing consumer awareness that a subjective scoring system exists, and finding a way for consumers to access the new system.

If a “critical mass” of people from the roaster to the consumer could agree on how to define quality in coffee in a simple and trustworthy way, the industry would be able to easily demand higher prices for higher quality roasted coffee in the same way it is working for the green coffee.

3)

4)

home of the person buying the coffee and produce the drink every time.)

The system has to be versatile enough to adapt to the many ways coffee beans are produced for the consumer: Light to dark roasts, single varietals and blends, as well as packaging decisions such as whole bean or K-Cup. The score must be for a specific lot, or blend which must be consistently tested to maintain its score.

Sounds simple enough…. But alas, it is not!

Until CQI, SCAA, or some other 3rd party steps up to the challenge, other systems will emerge and prove the concept in ‘micro-markets’. Cup Of Excellence (COE) is a great example of this.

COE as a ‘brand’ helps roasters sell the coffees that win in their competition. It is easily shown to be an objective system and the scores reflect a nice high score for the best of the best coffees from the winning entries. Unfortunately the competitions are few and far between and really it is just another way to judge the green beans and not the final roasted product.

So, the State Of The Industry for coffee is one that can be left to languish in the ambiguity of hype, or perhaps someone will finally step up in 2015 and create a consumer facing scoring system and allow a true reward for quality to start happening. Whoever does it will change the lives of everyone that cares enough to strive for true quality in their work.

Many look to the wine industry for a comparison. If you walk into any given wine store you will see industry scores posted next to the bottles that give you a number rating the overall quality and some word descriptors to help you understand taste attributes. The same can happen for coffee. Remember, this scoring system judges the vintners ability as well as the grapes that were used.

What does the solution look like?

1) It must be done by an objective third party with no interest in the coffee. Otherwise we will be right back to “My coffee is the best because we scored it a 100!”

2) It will be designed to grade the final roasted bean product, but not the skill of the barista and the resulting drink as there are several factors that can’t be objectively judged. (Unless the barista will go to the

December 2014

photo: Trish Rothgeb

Rocky Rhodes started as a coffee lover, became a coffee roaster, evolved into a coffee educator and is currently serving time as a coffee addict. He loves telling other people his opinion so being a consultant suits him well. Rocky can be reached at rocky@INTLcoffeeConsulting.com

Brewing Up the Bottom Line

by José Estorino Javatino

I

n a world where expert sommeliers can marry wine and dishes in perfect harmony, artisan coffee roasters have yet to be given the same matrimonial privileges.

It is amazing how some of the finest, Michelinrated restaurants can serve the most exquisite dishes paired with the finest wines, but when it comes time to serve decadent desserts they are accompanied by an afterthought: the coffee.

The interest in artisan micro-roasting and smallbatch coffee is on the rise, not only for patrons, but, more importantly, for restaurateurs, as not only is the ROI for serving premium coffee staggering; it is also an important element to the ever-evolving dining experience.

While 30 percent of the world’s Michelin-starred restaurants serve cheap coffee with costly crème brûlée, there’s a growing trend within the restaurant industry to reconsider this practice and stray from the norm. Coffee is often the last taste diners have upon leaving, but the pageantry of a great brew is often overlooked. Restaurants across the country can improve the coffee quality they serve customers, for today artisan coffee roasters can be found in every state and major city in America. Not only do these roasters provide fresh, diverse and exquisite coffee, but they also give restaurateurs the opportunity to support local, small-business owners, and in turn, make major profit.

Artisan roasting is expanding and evolving every day. The number of coffee-savvy sippers is growing and they collectively demand a better coffee experience. Consumers today are better educated about the production and location of food and the expectation of quality over quantity is growing.

The coffee story is powerful, whether it is focused on the origin, roasting process, or

unique notes; these details are imperative selling points and often justify the uniqueness of premium coffees. For restaurants, using coffee as a tool can enhance customers’ overall experience and provide a competitive advantage.

The roaster can bring new and exciting coffee experiences to customers, share exotic coffees from different regions of the world or provide coffees with distinct flavors full of smoothness and complexity.

Coffee seems to be evolving in a similar path as wine; through education consumers learned wines were not limited to pinots, chardonnays and merlots, and discovered unique blends developed throughout many regions by various grapes and processes. The types of beans, brewing methods and sources are integral components to the coffee-learning process and more consumers are finding interest in this delectable beverage.

The artisan roaster offers something a major coffee distributor cannot - freshly roasted coffee for surprisingly great prices, and local roasters are often willing to create a special blend for restaurants too. A freshly roasted, ground and brewed cup of coffee will delight customers and provide an experience they will want to repeat.

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Consumers also like to have choices. A restaurant typically provides options for various appetizers, main dishes and desserts, and coffee should follow suit. Java drinkers often have a plethora of preferences beyond the brewing method, but variables like coffees’ strength, creams, sugars or unique add-ins must also be considered when making the perfect cup. Be creative, offer unique coffee pairings, experiment with coffee liqueurs or carry specialty coffees, like 100 percent origin Kona or Jamaican Blue Mountain. A simple card highlighting specialty coffee offerings complemented by a dessert menu will increase the total check amount. A cup of coffee can be brewed for pennies on the dollar, making it a significant moneymaker.

This markup is substantial, yet for a mere $2 or $3, the customer does not feel like his or her wallet is impacted; rather, that his or her taste buds have been satisfied. This can make all the difference in dining.

Artisan roasts are taking over the java-brew world and kicking the bland coffee can out of the kitchen. The micro-roasting pilgrimage is about to take a major java jolt, and restaurants, especially fine-dining establishments, must be aware that this ever-growing trend for marrying delectable edibles and exceptional artisan roast guarantees a happily ever after.

José Estorino founder of Javatino

December 2014

The Indian Coffee Industry Challenges and Prospects

by Jawaid Akhtar Coffee Board of India

I

ndia is the sixth largest producer of coffee in the world with about 4% share in global coffee production. India is a high quality producer of both Arabica and Robusta varieties of coffee with the coffee being grown under a canopy of shade trees in ecologically sensitive regions of the biodiversity-rich Western and Eastern Ghats. Indian coffee plantations provide direct and indirect employment to about 0.6 million persons with the processing and exports/retailing subsectors also contributing to significant employment opportunities in the country.

Indian Coffee production rose steadily from 1950-51 and reached a peak of about 5 million bags (60 kg bags) in 2000-01 but subsequently slumped during 2001-02 to 2005-06 mainly on account of cumulative impacts of slump in global coffee price, the occurrence of drought, and the outbreak of pests & diseases during the period. Subsequently, the coffee sector has shown signs of recovery and the country’s coffee production crossed the 2000-01 level in 2010-11 and increased consistently reaching a peak of 5.3 million bags by 2012-13. By the year 2020, it is expected that India’s coffee production would rise to about 6.5 million bags.

Coffee is an important export commodity from India with a share of around 5% of world’s exports. About 70% of coffee produced in India is exported primarily to EU-member countries.

The domestic consumption of coffee is growing at about 5-6% per annum with enabling factors such as higher incomes, better awareness of coffees, and higher out-of-home consumption being supported by the industry’s initiatives to establish trendy cafes and other retailing formats. India’s domestic coffee consumption is estimated to have risen to about 1.9 million bags in the year 2013.

Producers hope to meet the growing demand by adopting a set of integrated and comprehensive strategies to increase coffee production in the country. Strategies to increase coffee output in the country should be based on the dual dimensions of (i) expansion of area under coffee cultivation and (ii) increase in productivity, while integrating issues such as scarcity of skilled farm labor and climate change.

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The Coffee Board has conducted extensive surveys towards identifying new tracts of land for expansion under coffee cultivation in traditional coffee growing states of South India

as well as in under-exploited states such as Himachal Pradesh and West Bengal. Based on the findings of the surveys, a pilot program for trial planting of coffee has already been initiated in Himachal Pradesh. In the states of Andhra Pradesh and Odisha, the state governments have been promoting coffee cultivation with an emphasis on tribal development and afforestation.

Increasing the productivity of coffee plantations by undertaking suitable technological interventions is a sustainable strategy that is feasible in the mid-term. Coffee-growing areas in India experience long dry spells, hot weather & excess rains during monsoon months which make it mandatory to grow coffee under shade, placing constraints on productivity levels.

Enhancing productivity would require the development of higher-yielding cultivars that are resistant to pests/diseases and stress conditions.

Coffee cultivation in India is a highly laborintensive activity requiring about 400 persondays/hectare/year for Arabica and 300 persondays/hectare/year for Robusta. In recent years, there has been a scarcity of skilled workers in plantation areas. This situation has led to partial replacement of existing Arabica tracts with Robusta as the latter requires a lower amount of labor while also being resistant to white stem borer.

Although most medium and large coffee plantations in India want to adopt farm machinery to overcome the scarcity of skilled labor, the uneven terrain reduces the effectiveness of mechanization on coffee plantations. In response, the Coffee Board has launched a focused research program to evaluate technological solutions, while also providing financial assistance for small growers to adopt farm machinery. New initiatives are being implemented, such as the Mission Mode Action Program on popularizing control measures against White Stem Borer. A multi-country collaborative R&D program with the World Coffee Research for improvement of Arabica coffee is also underway.

India has created a niche for itself in the international market as an origin of high Quality Coffees with value added coffee exports currently constituting about 30% of India’s coffee exports. In order to increase the competitiveness of Indian coffees, the government has initiated programs incentivizing exports to high value

December 2014

destinations such as USA, Canada, Japan, Australia, New Zealand, South Korea and Scandinavian countries.

The exciting growth in the domestic market during the last few years is creating entrepreneurial and skilled job opportunities.

Coffee retail market in India is estimated to be 17,000,000 Rupees growing at an annual rate of 20%. The Coffee Board is conducting a comprehensive Post-Graduate Diploma in Coffee Quality Management with modules spanning the entire value chain. The Coffee Board has also been actively contributing to the growth of the domestic coffee segment by conducting training workshops for stakeholders and entrepreneurs in roasting & brewing of coffee through short-term Kaapi Shastra Training Programmes.

With most leading roasters committing to procure sustainable coffees to meet most or all of their quotas, the Board has been providing assistance to Indian Coffee growers to produce certified Coffees under various programs. It is estimated that about 15% of the Coffee that is currently produced in India is certified under at least one voluntary program.

The lack of active growers’ collectives / producer organizations in the Indian coffee sector places limitations on the reach and effectiveness of extension services and technological innovations. Both the private and public sectors are implementing various programs to encourage the establishment and functioning of growers’ collectives / producer organizations across all coffee growing regions.

In summary, the Indian coffee industry is poised for exciting times ahead with rapid growth expected in domestic consumption and exports.

A dynamic, evolving private sector fostered by support from the Coffee Board is expected to lead India to emerge as a trusted producer, supplier and consumer of fine coffee. While exploiting the sector’s potential, it is essential that the challenges faced by the sector are wellmanaged regarding the issues of livelihoods, equity, and environmental sustainability.

By Jawaid Akhtar, Chairman of Coffee Board

Three Vulnerabilities

by David Gross Add A Scoop

W

hen entrepreneurs choose to venture forth, the opening costs can be staggering and overwhelming. The goal of being independent from any franchise is applause-worthy, but independence does have its vulnerabilities.

Independent coffee concepts’ initial vulnerability is exposed when it comes to securing a location.

They could lose their standing against the majors when it comes to location. It’s going to be more and more difficult to get into business and to expand because shopping centers and malls prefer the majors. Though this won’t be true in all shopping centers, it will be (and already is) happening enough to prevent the independents from entering into the “A” locations.

You will have to find your strength in differentiating your concept by catering to the health and wellness sector of consumer demand; to do something the majors are not doing. And more than that, once you’re providing something healthy, promote it. Use signage and POS to let your customers know the health benefits you offer. If you’re catering to the health and wellness market, why keep it a secret?

If you don’t actively monitor your restaurant’s online reviews, and participate in answering complaints, you will find your shop empty and you won’t know why.

participate in answering complaints, you will find your shop empty and you won’t know why. At any given moment, people looking on the virtual map for where-to-go will also see ‘Reviews’ hyperlinked as well. Your restaurant will be there. If they see, “This place is a rip off!” do you think they’ll give your place a chance?

You need to see that post and respond to it in a way that shows you take pride in your restaurant and you care about the customer experience.

Another case in point, the recent scandal Dominos Pizza had to encounter when someone posted a prank video showing the employees putting cheese up their nose before putting it onto the pizza. How would you handle that?

Domino’s responded within 48 hours but even that was too late according to AdAge, a trade publication. If you have employees and customers with Internet access, the Internet is your vulnerability. However, you can use the Internet to your benefit if you simply respond to customer complaints, and in a timely manner.

Your concept will face its ultimate vulnerability in your food and beverage presentations. The current trend is Health and Wellness. The independent operator will have to put together a menu board chock full of healthy options.

That is the ultimate vulnerability. You will find yourself having to compete not just for customers, but you’ll be in competition for prime business locations as well.

Of course there are exceptions. A lot of the independents do have good locations with prime real estate, but they’re pre-existing. They got in at an earlier stage of the game. Nowadays it’s likely that when those prime locations come up, the property management teams are going to say, “I’m bringing in Starbucks,” or “I’m bringing in Peets,” or Caribou, or whatever the case may be. Landlords don’t want turnover, they want security as in long-term leases. They want a draw; the overage; the percent rent. It’s not just a case where the majors are seeking locations, but the landlords are actively seeking them out as well. The landlords aren’t putting an ad in the paper for independents; they’re getting busy today by calling on the majors directly.

I don’t mean to be negative, but that’s the trend that’s happening out there. There are some cities where it’s opposite, where the independents are strong, for example the St. Louis area where

Kaldi’s Coffee is more dominant than the national brands. Portland Roasting of Portland does probably better than bigger names as well.

The same with Klatch Coffee of the greater Los Angeles area. Local chains can survive if they’re there. But trying to form one today? That would be tough. The mall would open up to a place like Kaldi’s or Klatch because they have established a name for themselves in their city already. But if they were just starting out, and it was name brand versus the unknown name? Well, if you were a landlord, you’d do the same thing. You wouldn’t want the hassles; you’d want the rent guaranteed by a public company, etc.

Another vulnerability to be aware of, and this is a must: You must pay attention to social media.

Your restaurant, whether you want it online or not, will be subject to crowd-sourced reviews on business ratings and reviews sites, the most popular of which is Yelp. If you don’t actively monitor your restaurant’s online reviews, and David Gross, President, Add A Scoop

58 December 2014

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Tiny, Little Steps

by Bill Fishbein The Coffee Trust

T

here is no such thing as Sustainability.

And if there ever was, it died when it was labeled as such.

I have come to this conclusion after 36 years in specialty coffee. I have seen specialty coffee grow from a dry seed to the flourishing plant it is today. But underneath its stunning verdant leaves there is a hidden blemish. The vast majority of the world’s coffee farmers live in poverty.

This was the reason I stepped out from behind the coffee counter at my own Coffee Exchange to create two non-profit organizations to help coffee farmers overcome poverty, feed their families, and live in dignity.

I established Coffee Kids with David Abedon and Dean Cycon in 1988, and I created The Coffee Trust 20 years later. I started both organizations because I couldn’t justify selling one more pound of coffee without doing something to help coffee farmers upon whose shoulders I stood on to earn my living.

My coffee business and the two non-profits have been extremely successful and extremely rewarding. But recently I’ve discovered a flaw that is threatening the stability of all three of my organizations. This flaw has to do with the labels we place on ideals.

When I founded Coffee Kids there wasn’t an outpouring of support. One might say there was a slow pouring of support. We were called radicals, socialists, and communists, until social and environmental issues became good for business. Suddenly, coffee businesses had a cause to support, and the cause was labeled all over their packaging. Worse still, consumers were led to believe the label. Meanwhile, for generations coffee farmers and their families have been hungry. It’s not pleasant, but it’s true. It is this contradiction that troubles me.

Strangely enough, the situation reminds me of the American Revolution. We look upon it as one of the pinnacles of American achievement.

The yoke of the oppressor thrown off, and a country built upon the principles of life, liberty, and the pursuit of happiness, born in the process.

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Freedom is our calling card, and the words “All Men Are Created Equal,” burned into our collective memory, just like the ink that saturates

the paper upon which those immortal letters were first written.

Yet, the illustrious “All Men Are Created Equal” was about as true then as today’s statement that coffee is sustainable. At the founding of our nation only 1/3 of the people could vote, the wealthy landowners. Women couldn’t vote. And Slavery? Slavery was part of freedom’s landscape.

So the question emerges, “How could the founding fathers say freedom and accept slavery”? How can the coffee trade say sustainability and accept hunger?

I have come to believe that it is simply too big of a challenge to change the entire world all at once, especially when we are all pretty much dependent upon the world being the way it is.

The founding fathers were dependent upon the way things were in 1776, and that included slavery. The coffee trade is dependent on the way things are in 2014, and that includes hunger.

Expecting to change our dependency upon the way things are immediately is an illusion of the highest order. Yet, we communicate this illusion while we should be communicating the discrepancies between the labels we place on our ideals and the realities that exist.

Ironically, by recognizing these discrepancies, we put ourselves in the position to work towards achieving the perfect form of each ideal. And all we have to do to accomplish this is take one…… tiny...... little...... step.

Recently, I decided to walk to work on Tuesdays.

I couldn’t change my entire world all at once. So, I decided to take one tiny little step.

An easy step. An achievable step. A guaranteed to succeed and become routine step.

ideals to become reality, their project needed built-in action steps, not big ones, but instead tiny, little steps.

The coffee trade could acknowledge the discrepancies that exist today and accept that sustainability is unrealistic in 2014, but instead is an ideal to be rigorously pursued.

Today, my coffee business is threatened. If it hides behind the labels of sustainability, it will make it impossible for either to truly exist.

Farmers will continue to go hungry. Because their children are hungry, they will wade through water, walk through jungles, and wallow in the desert, to cross the border to the United States for a place where their children can eat.

And one day, there may be no more farmers to grow coffee anymore. Sustainability will have been destroyed by its own label, and along with it my coffee business and untold others as well.

Imagine though, if my coffee business was more concerned about pursuing the ideal of sustainability; each year challenging itself with more tiny, little steps. Imagine if other coffee businesses did the same thing.

My two non-profits are threatened. They use the label “sustainable” to articulate success. What if my two non-profits were more critical of the use of the label, “sustainable,” speaking a little less about sustainable successes, and little more about the unsustainable reality?

Labels are toxic. They imply that they are absolute, complete, and contain all the answers.

And herein lies the problem. For once we believe we have all the answers, we stop asking the questions. And yet, it is within our questions that we can find the next tiny, little step.

And when that step has become a part of my routine, I will continue with these tiny, little steps. Imagine what our democracy would look like today had the founding fathers written into the constitution the need to take tiny, little steps.

That’s 238 years of tiny, little steps.

They could have acknowledged the discrepancies that existed and accepted that total freedom and total equality were simply unrealistic goals in 1776, but instead, were ideals to be rigorously pursued. They could have stated that for the

December 2014

Bill Fishbein, Executive Director, The Coffee Trust and Jake Fishbein, Volunteer Reporter, The Coffee Trust

Your Coffee is in Trouble La Roya, or Coffee Rust is a deadly fungus wreaking havoc on Central American coffee farms.

If Coffee Rust continues unchecked, the rippling effect will cause a catastrophic loss in incomes, jobs, and food security for coffee farmers.

The Coffee Rust outbreak has pushed already impoverished farming families to the edge of survival, and it’s getting worse.

Poverty and hunger increases, along with the price of your coffee.

25k Total Chajul Region Coffee Production in QQs (100lb Bags)

20k

15k

10k

5k

0

2011

2012

2013

2014

Production is plummeting.

Since its outbreak, some farmers have lost up to 75% of their income due to Coffee Rust.

It’s a National Emergency.

Guatemala, Honduras, and El Salvador have declared Coffee Rust a National Emergency.

YOU CAN HELP A safe, organic, sustainable solution.

• Uses cost effective micro-organisms to eradicate coffee rust on plant leaves and in the soil.

• Provides farmers with training in soil replenishment and plant maintenance.

• Improves food production while eliminating coffee rust.

• Empowers farmers to spread their newly learned skills to other farmers.

Find out about hosting your own fundraiser by contacting helpnow@thecoffeetrust.org.

Support the La Roya Recovery Project, a roaster-to-roaster fundraising effort uniting specialty coffee roasters, retailers and customers throughout the country in the effort to stop the spread of coffee rust, recover coffee production and help coffee farmers feed their families.

www.TheCoffeeTrust.org

Riding the Waves of Coffee Equality

by Don Holly Industry Veteran

N

ature expresses itself magically in waves.

From the movement of electrons and photons to the motions of the ocean, waves are the way that nature dances.

Industries have natural waves, too. Expansions and contractions, movements of various orders that have harmonic amplitudes and frequencies, with the occasional rogue crescendo that can be highly disruptive. Sometimes these patterns can be highly predictable, even comforting, and have positive effects in moving an industry forward. Other times, the inexorable impact can be menacing and destructive, requiring a reset of industry standards, culture and goals. Our industry is in the throes of such a pattern right now, and every participant must choose how to ride these waves.

The state of the coffee industry has had various wave monikers applied to it over the past decade, and as of last year it has been suggested that we have now entered the 4th Wave. About time; but really, what does that mean?

If the first wave of our industry was the commercialization of coffee following World War II (which seems more like a low trough between waves), and the 2nd wave was the growth of the café culture and specialty coffee industry from the early 80’s through the millennium, then the distinction of the 3rd wave was characterized by intense focus on quality – from farm through roast to cup. The 4th wave has been defined as the practiced interdependence of the supply chain, with balanced sharing of risk and value from origin through consumption. It is an optimistic vision of the evolution of our industry, and we can only hope that it is not too late to ensure a sustainable future for our beloved product.

So, where did coffee quality shake out in all this wave making? Certainly on almost every front and from any perspective it is easy to contend that we are all better off now versus thirty years ago, despite the challenges facing our industry.

The availability of great greens, skilled and conscious roasters, talented and passionate baristas can be found in every large city and suburban area, and even in the most out-ofthe-way rural hamlets. It is AWESOME. Does everyone have wonderful coffee? No. It is still the minority of brown beverage sold that could be deemed drinkable by the discerning palate; but it is a hell of a lot better than it used to be.

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There are still many challenges to coffee quality and the critical role it plays in our industry, and no doubt that the biggest risk is long term sustainability of supply. The published data that puts the average age of coffee farmers at 50+ is alarming. The difficulty of receiving commensurate pay annually for producing a great coffee is discouraging the next generation from keeping the family in farming. This should be a call to action for everyone in the industry to rally around collaboration in our supply chain so that the next generation of coffee drinkers have something to put in their cup.

There is another industry challenge that occupies the consciousness of most roasters: single-serve coffee. Just to be clear, single-serve is about the dominance of the K-Cup, referred to recently by an industry colleague at the NCA Summit in October as “the big elephant in the room.” It is in fact such a profound rogue wave (or more accurately, Tsunami) for our industry, that it has affected and will probably permanently alter the structure of how coffee is sold and consumed here in the United States. Its success as a disruptive technology, dominating the sales of coffee brewing appliances for consumers the last few years, and rapidly securing a 15%* ‘share of mouth’ with continued accelerative growth, cannot be ignored by anyone in the coffee business. It has been forecasted that potential terminal velocity of consumer adoption could be as much as 40-50% of total households, where 85% of coffee is consumed. The success of the single-serve system is based on convenience, variety and quality that consumers found has great value, equivalent to paying $30-60 per pound of coffee.

Whether the interlock technology of the Keurig 2.0 is able to secure total proprietary dominance for KGM in the making and selling of K-Cups will be tested in the courts and on market shelves over the next few years. In the meantime, other appliance manufacturers and non-Keurig licensed roasters are seeking to garner some of that share of installed and still growing brewer base and use, before they get swamped.

Keurig has such a huge lead on manufacturing capacity and efficiency that “system compatible” packagers will be at a serious competitive disadvantage. And the barriers to entry for a new single-serve system are extraordinary.

Keurig itself could not overcome their own K-Cup based system with the “better” VUE product launched several years ago, despite a massive investment in capital and leveraging of

December 2014

its distribution and marketing muscle. Small to medium sized roasters may be locked out of the system on the basis of economics.

So what do you do when faced with the onslaught of a Tsunami? Well, the survival manual would suggest that you grab only the valuable possessions that won’t slow you down and you RUN for high ground. If you don’t have a big enough surfboard (metaphorically) to get up and ride the huge wave, the best advice is to make a secure spot on higher ground. Anytime that a new high water mark becomes the norm, then you have to move camp even higher to survive. Our human ancestors have proven their adaptability to changing environments, evolving through catastrophic meteors, ice ages and flooding. The landscape may change permanently, but we can still figure out how to thrive.

Specialty coffee has had its success principally on the basis of quality. Quality of the product and experience can always be raised to a higher level. Is it a challenge to teach consumers how to appreciate fine coffee enough that they will learn, or relearn, how to make a French Press or AeroPress at home with a fresh roasted specialty coffee? Yes, it is. But if the new tide level of satisfaction is that the resulting quality needs to be greater than the convenience of them choosing to stick a single-serve cartridge in a brewer and pressing a button, then get to it. It is a matter of survival.

Remember, every wave is the synergy of zillions of water molecules acting together to express themselves according to the magic of natural forces. Our industry is fairly magical, too, in that the natural collaboration and interdependence of all of the players – growers, traders, roasters, retailers and consumers – determine the value and quality of our product. We may not be able to stop or ride every big wave that comes through, but we can certainly all do our part to contribute to each other’s success to make the industry as a whole continue to evolve positively.

We owe that to coffee. *Much of the data cited is based on the NCA’s 2014 National Coffee Drinking Study

Don Holly

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The Industrial Internet of Things The Rise of the Mechs

H

ere is a question for coffee houses and other Main St. businesses, “How much did equipment maintenance issues cost you last year?” Think about lost productivity, lost sales, labor and parts, lost customer satisfaction, scheduling issues, and a host of other costs as a result of equipment down-time.

What would be the benefit to your company if you could reduce these costs significantly and deliver better customer service? Let’s think about your espresso machine. This is a highly engineered and sophisticated piece of machinery. One is in almost every coffeehouse in the world. If it stops working, the café might as well flip over the closed sign.

To reduce this possibility, the machine manufacturers have engaged a global network of service companies to rapidly repair their machines when they develop problems. But this solution is very expensive and inefficient.

Café owners want their machine fixed now, but are notoriously bad at communicating what the actual problem is. The service company has to rely on the initial diagnosis by the coffee shop when the real problem could be caused by something completely different. The service company needs to be prepared for any possibility.

Now, let’s think of a world where your machine is outfitted with a sensor array and a microprocessor that communicates wirelessly with a database and automation software residing on the cloud.

In this world, a microprocessor is continuously polling the health of the machine and sending updated status reports wirelessly through an access point to a massive presence in the cloud.

Using parameters set by the manufacturer, the incoming data is compared with these acceptable ranges for operational compliance. If everything is within the acceptable range, the database simply files the new data and waits for the next report.

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But, if a sensor detects some element that has gone out of compliance, say for example a pressure drop at the group head, the anomaly is immediately tagged and an alert is sent to the manufacturer and their designated servicing vendor. Before the shop owner knows that there is a developing problem, the service company is already on it.

Imagine how much better you will sleep at night by being aware of approaching issues and having a system that gives you and your staff a pathway toward positive action.

Before the service person leaves his shop, he now has knowledge of what to expect at the coffee shop, what tools and parts he needs to bring, how soon he needs to get to the job, and how long he will actually be on site.

Imagine the effect that this proactive response will have on the coffee shop owner. What a surprise that the first person that comes through the door right after the shop opens is the service person. Being proactive with service calls is much less expensive than reactive to emergencies.

Credibility and proactive solutions mean happy customers and increased sales. Just like you want to cut costs and be more competitive in your business, your customers want that as well.

A tool like this allows you to do that for your clients as well as your own business.

Imagine how much better you will sleep at night by being aware of approaching issues and having a system that gives you and your staff a pathway toward positive action.

Consider how many mission-critical elements there are in a typical coffeehouse. For example: • The espresso machine, the brewers, the ice maker, all that refrigeration and freezers, the water filtration system, security, POS systems, inventory control (using RFID), kitchen prep equipment…to name a few.

You can begin to see how the Internet of Things will ultimately have a huge impact on Cafes and vendors. But remember that this is only an example of Coffee shops. This same future is inevitable for most of the small businesses on Main Street. If the business has equipment that is mission-critical to the business’ success,

December 2014

by Miles Small CafeComm, Inc. it is on the list of industries that will be affected by the Internet of Things either by embracing the changes and growing their businesses or by ignoring the changes and eventually fading into obscurity.

As the cost of sensors and microprocessors continues to fall and the costs of maintaining in-house servers skyrocket the momentum of change can only accelerate. As the deluge of BIG data generated by these systems exponentially grows and Small Business owners and equipment vendors are drawn closer together in a mutually dependent relationship, those business that do not embrace and adapt will be increasingly sidelined.

We are not rambling about talking toasters here. We are talking about whether or not your business will be competitive five years from now.

As with all disrupting new technologies, either your company adopts or it must learn to adapt.

Remember when a Blackberry was the smartest handheld device you could get? (Don’t even talk about the Palm!) That was five years ago, now what do you think? I bet RIM (Blackberry) wishes they had been paying more attention.

In today’s rapidly advancing tech world, today’s billion-dollar supergiant is tomorrow’s liquidation auction.

This advance is truly paradigm changing. It is the next logical advance in the Internet’s potential, it increases a business’ bottom line profitability, it uses current and familiar technology, the entire data transmission infrastructure is in place, and it has a crystal clear value proposition.

The Internet of Things is going to happen. The question is, are you going to lead, follow or get out of the way so your competitors can move in?

For more information on the impact of the Internet of Things on your business and world, please contact Miles at miles@cafecomm.com or visit www.cafecomm.com.

Miles Small, CEO of CafeComm, Inc., a “big data” service provider and developer of wireless tools for the Coffee industry.

Ignoring Climate Change and Reforestation: An Unsustainable Effort

T

he topic of sustainable growth is on the lips of almost everybody in the coffee industry today. What it implies, however, depends on who’s doing the talking.

That was apparent at the recent National Coffee Association’s (NCA) Coffee Summit 2014, held in Boston last October. The reasons for touting Fairtrade Organic Coffee vary among retailers: some see it as a means of increasing market share and profit margins, while others think it a necessary step to decreasing the environmental impact of single-serve products.

While all these arguments are valid and worthy of discussion, one perspective often goes unheard – that of coffee farmers themselves.

Given the advanced age of the average coffee farmer, the ravages of la roya, fluctuations in coffee prices, and the effects of climate change, is it safe to assume that green coffee is a sustainable resource? How can we guarantee, for instance, that farmers will not abandon coffee for a more profitable crop? How can we even be sure that their precarious financial situation will not force them out of agriculture altogether?

These questions in turn lead to another: how can we ensure sustainable growth for coffee farming?

Planting the seed for sustainable growth Years of working in South America setting up and developing farmer-owned cooperatives have given me a keen appreciation for the hard reality most farmers face.

Given that many work in isolated areas, support – whether in the form of technical assistance or of training in efficient and ecological farming methods – is virtually inaccessible. If left unresolved, the lack of resources and the

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by Etienne Desmarais Ecotierra constant setbacks will affect farmers’ profit margins, their financial security, and ultimately their willingness to invest in coffee farming as a means of securing their family’s future.

This realization is what lead me to seek a sustainable solution, one that would guarantee farmers adequate returns, reduce the impact of farming on the environment, and provide a new source of coffee with added value to the buyer.

Preserving the future of coffee farming My experiences in South America gave birth to the Shade Coffee and Cocoa Reforestation Project (SCCRP). The primary goal of the project is to improve the quality of life for participating farmers, and my partners and I are aware that the only way to achieve this is by addressing the underlying environmental issues. Be it burning fields as a weed control method or engaging in illegal logging and mining, poor forest management techniques have contributed to the depletion of forest cover, to soil erosion, and in turn, to a loss of income for local producers. These ecologically unsound practices can only impede the development of a sustainable economy for coffee-growing communities.

To counter these practices, we turned to working with small-scale farmers to reforest, restore and rebuild disused and deforested parcels of land through shade-grown agroforestry systems that promise high yields, better resistance to disease and, a high-quality, profit-generating crop.

The project regroups over 15,000 small-scale producers in 33 cooperatives that share a common vision of developing a sustainable economy through sound environmental farming practices combined with the increased produce and profits from their reforested lands.

We offer a comprehensive training program for local cooperatives and individual growers, one that focuses on updated farming and sustainable forestry methods. The goal is to educate our stakeholders on the realities of climate change and to give them the tools to combat it.

December 2014

Even in the short-term, this leads to an increase in productivity that will ultimately result in a sustainable agricultural program.

While reducing carbon footprints does factor into our evaluations of the success of the project, it is not the most important consideration.

Increased income from newly planted crops, better landscape management, reduced soil erosion, as well as improved water quality will all lead to an increase in biodiversity and are thus equally important goals for us.

Our web-based in-house database – the Minka – gives us twenty-four hour access to information on reforested land parcels, their owner(s), and the scale of their crop production. This in turn allows us to track the results of the project.

An ethically sourced, risk-managed investment In recent years, we have seen more and more high profile investors back projects that have turned out to use unsustainable sourcing practices. This has led us to establish regulated sourcing practices that are guaranteed to be free of any association with deforestation.

Through the SCCRP, buyers can access Fairtrade, organic, and environmentally friendly coffee, or as we like to call it: greener green coffee!

Sustainability: an industry wide-concern Sustainable growth is clearly a hot topic in the industry. However, we need to take things step by step. While the environmental impact of single-serve products cannot be overlooked, we must first address the issue of making coffee farming a sustainable endeavour. After all, imagine the impact on the industry and the environment if coffee were to cost $10 a pound or run out altogether? Let’s stop the future of coffee farming from running dry.

Etienne Desmarais, President & CEO Ecotierra