For Whom the Retailer Roasts
From the July 2006 Tea & Coffee Trade Journal
So you've already begun to dream about the many ways that adding a coffee roaster to your retail coffee shop will improve your business. Good for you! Visualizing your ideal outcome is the first step in successful planning for any project; it gives you a goal at the end of the tunnel to strive for later when you're stuck in the dark details of implementation and problem solving.
Now close your eyes: smell that sweet scent of fresh-roasted coffee wafting through your shop. Ahhhh. Count the extra cash that you expect to save from purchasing green coffee instead of roasted coffee and the new streams of revenue you will earn from all of those wholesale accounts. Imagine your retail customers casually sipping espresso in the noir ambiance of a gleaming metallic coffee roaster; if you squint your eyes enough, you may just believe that you're seeing couples embrace in the shadow of a steam locomotive at the end of some Ingrid Bergman film.
You can open your eyes again. Before we get too carried away with all of the imagery, let's step back for a second and make sure that these expectations can be reasonably achieved - after all, this is exciting stuff and it is easy to become spellbound by all of the new possibilities. The decision to roast one's own should not be taken lightly, as this may require a dramatic restructuring of your retail business model in addition to your investment in labor and capital equipment. You wouldn't go out and buy a cow to supply your own dairy without some good hard thought first, would you? I didn't think so.
Before committing yourself to this path, be sure that you consider these few simple points below. Just to be clear, it is not this writer's intention to persuade you one direction or the other as you consider the benefits and drawbacks of in-house roasting; but rather, to see that you consider these points at all.
Plan for the time and labor required to operate and support your roasting operations.
Many new roasters (the people) seem surprised by the fact that roasting is a very time consuming and labor intensive process; in fact, to maximize the return on your investment, your roaster (the machine) should operate as much as is reasonably possible to meet demands for saleable product.
One might ask, "How long can it possibly take to make the coffee that I use in my single retail location and handful of wholesale customers? After all, the coffee roaster brochure says that I can output over 50 lbs per hour!" Remember to consider not only the volume of coffee that you intend to produce, but also the number of unique varietals, since each will likely be roasted independently and blended later.
Even with one single location, the typical weekly batch of regular and decaffeinated brewed coffees, a specialty featured coffee, regular and decaffeinated espresso can easily add up to 15-20 cycles, each completed in reasonably not less than an average 15-20 minutes. Add time for packaging and blending and you're looking at a full workday for a week's worth of coffee - work that may not be possible or practical to perform concurrently with retail operations.
Of course, there is more to this than the operation of the coffee roaster itself. To make the best use of that investment, you're probably going to want to attract wholesale accounts; for all intents and purposes, this can be considered a separate and distinct business from your retail operations. Surely there is some crossover and there will be retail consumers that want to buy your coffee wholesale for their own business, but give serious thought to updating your business plan to reflect the many potentially significant changes to your business model. You will need to plan this new segment of your business just as you would any new stand-alone business, including identifying sales and marketing objectives, budgeting income and expenses and allocating resources to your staff in order to support increased demand for sales, marketing, support and production roles.
Staffing appropriately for a roasting operation is essential; this may be particularly difficult for the startup owner-operated independent location as attempting to do both may be a drain on available resources. Failure to dedicate sufficient employee hours to account for scheduled and last minute orders may lead to some unpleasantly long work nights - but at least you'll have plenty of coffee on-hand to stay awake.
You do not want a half-ton paperweight: use your team of advisors to avoid simple but potentially costly mistakes.
Zoning restrictions, city ordinances and building codes, oh my! A whole circus of legal obstacles and physical limitations await you at your location that can stall your progress before you even begin; never fear, you need not go forth onto that stage alone.
Speak with your professional advisors before and while you undergo your expansion to be certain that you have not overlooked some basic - but not necessarily obvious - requirements. Air pollution agencies and even your retail lease may prohibit installation of roasting equipment, which alone may prove costly, or at least frustrating to surmount if not handled properly.
Also consider more the more physical (but no less real) limitations of your facility. Where were you planning on venting the roaster exhaust, do you have the right or approval to run ductwork up and or out? Do you have adequate loading access and storage facilities to accept and hold hundreds or thousands of pounds of green coffee and packaging materials? You'll need it.
Speak with your:
- Attorney to help you identify potential limitations in your lease, identify prohibitive local ordinances and work to obtain permission from your landlord and agencies
- Insurance provider to identify limitations and restrictions in your property and liability insurance; your coverage will likely need to updated
- Roasting consultant to identify equipment needs, space and facilities requirements to accommodate your staff, inventory and supplies
Learn your craft - and learn it well - before your beverage quality and business suffer
The act of replacing good quality coffee from some knowledgeable and well-performing wholesale roaster with coffee that you have roasted yourself poorly will not financially benefit your business.
Roasted specialty coffee is not a commodity and should not be viewed as an interchangeable assembly line component. Shaving a few dollars off of the price per pound may reduce your cost of goods sold, but you'll also reduce your customer satisfaction and sell less "goods" - so make sure that when you are ready to make the final transition in-house that you are fully confident of your competency.
Think of a roastmaster as being like a musician: just like in music, there's much more to know than just how to operate the instrument. Anyone can learn the hand or finger positions of a musical instrument in a short period of time and honk or bang out some notes; however, to play a tune that listeners wish to hear, you must not only master your instrument but also the reading and interpretation of written music. Those who study their craft further to learn music theory can then abstract and create unique expressions of their own design that become a signature hallmark of their own mastery. These "recipes" of music can then be recorded in a manner that can be communicated with others in a format that contains details for their consistent recreation.
Just like music, do not overlook that roasting is a craft that requires proficiency not only in the operation of the mechanical roaster itself, but also in a number of complimentary skill areas, including green coffee buying, blending and cupping, which are all necessary to create the ideal product of your efforts. For example, you did calculate into your financial projections that roasted coffee weighs 15-20% less than green coffee due to water evaporation, right? Understanding this fundamental principal of coffee roasting is not necessarily something that will appear in the operating manual for your roaster, but could be just the sort of costly oversight that could mean the difference between profit and loss in this segment of your business.
As in most of life and business, the choice to roast your own coffee does not need to be an all or nothing decision. It can take a great deal of time to carefully plan and executive a successful roasting implementation at a retail location. Create procedures, staff your business appropriately, procure inventory and learn the craft before you can become self-sufficient. Throughout that process, use your time wisely and continue to develop and expand your relationship with your wholesale roaster; you may just find that communication will not only help to improve your skills, but that there may be complimentary opportunities for you to support each other as your businesses grow.
In an ideal world, your current wholesale roaster may even assist you to develop your own coffee blend; however, you will likely find it difficult to gain their cooperation in simulating a blend of their own creation to which you have grown accustomed. In this case, you may consider the outside services of a coffee taster to help you analyze and recreate the flavor profile that you wish to retain. Blending requires the specialized skill of tasting and adjusting varietal components to produce a desired output - analyzing an existing coffee to recreate its flavor elsewhere is even more complex. Espresso blends regularly consist of between 5-7 unique varietals of coffee, each adding some important characteristic to the whole, including: aroma, body, crema, taste and flavor. A well-trained palate can identify each component of a blend and help you to re-create and improve upon your signature coffees.
Though not every coffee shop is ideally suited to also roast coffee, there is no reason that a coffee shop cannot succeed doing both and doing both well. So long as the venture is planned and executed with due care, the merger of your retail coffee shop and coffee roaster could be the beginning of a beautiful friendship.
Published: February 2007, Last Modified: September 2011