Author: Head Roaster Date Posted:1 May 2016
We have mentioned in our articles about the current state of the Australian roasted coffee market - it's tough, crowded, saturated and highly competitive.
Just like the gold rush of the 1850's, every day there are new entrants and brands on the market and this has become confusing for consumers - once upon a time there were just a handful of recognizable brands but now there is such an unstructured saturation of brands and labels that consumers are struggle to identify leaders. In populated cities you can literally go anywhere and be confident of being able to purchase a coffee beverage, day or night within easy walking distance.
Whether it's watching your children run around the park on a weekend footy match or attending a social or charity event in public spaces, you are almost guaranteed that not far away will be one or many mobile coffee vans, a venue outlet or the myriad choice of cafes and outlets now serving espresso coffee - we are spoilt for choice.
Competition has been good for the coffee industry in general - stimulating innovation and pushing providers to step outside of their comfort zones to constantly improving the general standards for product offerings.
At the same time that product quality has improved, so too has the expectation of the coffee drinker - the Australian coffee consumer is now smarter, more informed about freshness and quality and we should not be surprised to report that Australian coffee drinkers are some of the most savvy and discerning groups in the world when it comes to identifying coffee quality and value. Rarely will an Australian coffee lover tolerate mediocrity or sub-standard when it comes to their cherished cup.
Some things never change
Unfortunately, some segments of the coffee supply market such as the supermarket and some styles of roasted coffee bean retail outlets do not see the need for change or improving their quality benchmarks because they are committed to filling the basic needs of price and convenience.
At most, these volume based, mass-produced budget coffees will occasionally freshen up their external packaging every couple of years with a more modern style to keep you looking at their product on the shelf, or they generate some marketing spin about why their product is the best.
But, and this is the important distinction, they won't change their ways to improve product quality or freshness because their customer is not the end consumer of the product (you) who is making the decision on buying, but it's a large retail company that operates on simple principles of screwing down suppliers to the lowest cost and ensuring shelves are always fully stocked - regardless of whether it's low grade and stale.
Why is there so much attention given to the latest hyped up coffee Brand
Entering a crowded and competitive market is a brave step for smart people. However, the majority of new coffee company brands launching on the Australian market in the last few years are not born from intelligent business decisions.
It should come as no surprise to learn that most of the coffee companies being created these days are the brainchild of people who are ignoring the basic market fundamentals and pushing ahead regardless.
Sometimes, they are started by your typical coffee tragic and 10 years ago I put myself firmly in that same camp. These are people with incredible passion, enthusiasm and excitement for the possibility they can do it better, faster and cheaper than everyone else. Unfortunately, the reality is that it's all been done before, by experts and experienced people. Novices make mistakes.
Mostly these start up Coffee Companies are owned by bored baristas or cafe owners thinking they can do a better job of roasting coffee than the experienced professionals. Or they are seduced by the false hope of selling so many kilos they will be rich and famous in no time. Some are from experiments at home with various appliances and before too long a healthy dose of delusion overtakes their thinking - of course, my product is superior to the professionals.
The harsh reality is that coffee roasting has nothing to do with freakish talent, or simplistic formulas of buy more expensive beans = a better product, or working on the basis of a lower margin. It's a combination of hard work, lots of practice and constant perseverance over many years and years.
A new coffee brand does not mean it's better than the existing brands in the market. Existing coffees brands don't get lethargic or disinterested - they looks at ways to improve and optimize their business and adapt to changing environments.
New brands don't have any distinct advantages over existing brands. In fact, new brands have yet to learn where and how to source the best quality lots of raw coffee, or how to setup roasting plants that can take 2 years to stabilize and turn out consistent coffee.
Most of the hyped up marketing for new coffee brands is around the same themes of "we buy better", "we know better", "we try harder", or "we care more". These taglines are false and hollow promises - unproven and untested.
Experience and Ownership Matters
The people sourcing and roasting the coffee are the determining factor over quality. It rarely has to do with the pretty colours on the coffee bag packaging or the well liked pictures on their facebook page.
Putting aside logistics and sales channels for a moment, what you taste in the cup is a direct result of the skills of the people in production and the tools they have at their disposal, including how much they can spend on quality - if at all.
Coffee roasting is hard physical work. It's back-breaking throwing around 70kg sacks of coffee at speed and those working in coffee roasting production may lift each single coffee bean up to 12 times from the moment the raw coffee arrives into the warehouse until it reaches the customer in the roasted product - that's a lot of lifting and like a concreter, it takes it toll on the body. It's ridiculously hot in summer standing next to a 400 deg C oven and uncomfortably cold in winter working in large windy warehouses without heating. It's dusty, smoky and very unpleasant.
There is nothing glamorous or romantic about roasting coffee beans. Like any volatile food product, the coffee roaster is equivalent to the head chef at a fine dining establishment. If they have skin in the game, e.g. an owner, they will care for the product just as passionately as their children.
If they are an employee, it's just turning green stuff brown. Yes, they may have pride in their work at the beginning, but after a while it's going to wear them down into monotonous production routine. Often coffee roasters are the source of all negative feedback in a coffee company and for this reason many get frustrated and upset at being blamed for quality inconsistencies. It's not a long term role for the majority of people.
At justfreshroasted.com.au, the owner of the business roasts all the coffee. Nobody is allowed to operate the roasting platforms. It's this sort of personal commitment to quality that separate our product from the competition.
Big companies have tighter budget constraints on quality
It comes as no surprise that larger coffee companies actually don't source high quality coffees for the majority of their products. Yes, they can source quality lots for the purposes of marketing to promote quality, but their every day coffee blends typically consist of budget grade coffees.
The larger the company, the greater the budget constraint. Saving $1 to $3 per kilo on raw coffee from sourcing lower grades translates into $10,000 to $30,000 per week in pure profit - that's straight on the bottom line and into the stakeholder's pockets. So, the larger the player, the more critical it is to source cheap coffees and maintain the illusion of quality.
See our other article: Why African coffees are the best?
At justfreshroasted.com.au, we take the opposite view........we think there is an opportunity to build a market from providing the best quality and value - converting customers across from those coffee companies that seem intent on taking their customers for a ride using lower quality.