Building a business in this specialty market is a tricky algorithm of timing, research, intuition, and money spent in the right directions. Something as simple as the presentation of tasting notes on coffee bags can make a huge difference in reaching a target demographic. Choosing whether or not to sell clients syrup and paper products along with the coffee can affect the bottom line tremendously. Light vs. dark roasting (and all the gradients between), air vs. drum roasting, single-origin vs. blends: every decision carries weight.
Phil Goodlaxson, founder of Corvus Coffee in Denver, offers a strong piece of advice to the bright-eyed dreamer: don’t try to mimic other successful coffee companies. Learn from them, for sure, identify what you admire, and then hone your own vision until it can stand on its own. Why would anyone want to buy coffee from a roaster imitating Heart Coffee Roasters when they can buy from Heart itself? And how can the observer possibly know the internal mechanisms that lend Heart its success? By all means, ask questions of anyone who will answer them, read, take classes, and shadow others. Then, synthesize all those pieces into a working business plan complete with a vision statement to which every decision you make in the future, large or small, can be compared.
From Café to Roastery
On the practical side, building a roasting operation is a complex and potentially rewarding endeavor. First things brutally first: is it really a good idea to roast your own coffee? If you own a café, should you continue purchasing beans from an established roaster instead? “The biggest concern I have is, what is the economic cost of the roasting business?” says Tracy Allen, founder and CEO of Brewed Behavior. “Will it take your focus away from being with customers? It’s a problem when the biggest contributor of the retail environment [the owner] gets peeled away to oversee roasting operations. I can think of people who roast through the night so they can still be present in the café or to keep labor down.”
The usual motivations for developing a roasting program are straightforward: vertical integration of the supply chain, quality control over the product and story, and (often) reduced costs for one of the most expensive products in the café. Ben Helt, founder of Benetti’s Coffee Experience in Raytown, Missouri, a suburb of Kansas City, says, “We decided to roast at the beginning, because we always knew we wanted to do some wholesale.” He adds that at the time he opened his coffeehouse, Kansas City didn’t have its current strong crop of micro-roasters, and that now, seven years and one renowned coffee scene later, it actually encourages him to see cafés opening that focus on showcasing local and national roasters to their customers without roasting their own coffee. “You have to act differently in your café when you roast coffee for sale, because you’re trying to set yourself up as an authority and your real source of money is going out the door as wholesale. You may not be reaching out to the audience you have at hand because you’re trying to maintain a certain image and can’t interact with your customers on a daily level so easily.”
Need to Know
Pressing question: how much should you know about roasting coffee before you start roasting? Usual answer: varies widely. “Roasting manufacturers will often make roasting sound very simple and straightforward, while roasters might say the opposite,” says Tim Cureton, founder of Rise Up Coffee in Maryland. “When I finally decided to leap into roasting, I went on a quest to figure out what to do.” His first question was whether to learn the craft himself with Noah Kegley, his business partner, or to hire a roaster who already possessed the knowledge. Settling on the former, he and Noah drove up to Waterbury, Vermont, to study coffee roasting in Mané Alves’ Coffee School before stepping out on their own. “I’ll never forget him patting us on the back at the end of the five-day course and saying dryly, ‘You can do this.’ Of course, it was just the beginning,” says Cureton.
There are many private training options available, and many roaster manufacturers offer in-house instruction. The Roaster’s Guild also provides long-term support through classes and the dynamic community of roasters it magnetizes. Private instruction and apprenticeship is deeply valuable, with the right instructor.
The unspoken truth hampering the free flow of coffee-roasting knowledge is that for many roasters, profiles and systems are proprietary. Thus, it’s hard to step beyond a certain level of understanding without either stumbling into the perfect apprenticeship or just figuring the details out the hard way. A huge amount of skill in roasting simply comes from repetition, observation, lots of cupping, and adjusting course regularly, making it accessible to anyone willing to work at it.
The Kit and the Green
The equipment needed to start is simple. Allen says, “Get the roaster, a good table or workbench, packaging, bags, and labels. If you plan to ship you’ve got to buy boxes and filler.” As for roaster size, Allen says that on average, with packaging time and the inevitable interruptions, a roaster can count on 2.75 roasts an hour, which averaged out over an eight-hour day can give an idea of capacity. “A lot of people might want to buy a twelve-kilo roaster but only need three,” says Allen. Helt adds, “There’s a certain scale to making a living roasting coffee, and without wholesale, a single café doesn’t seem big enough. I’d be impressed with those who could generate that much income in a single-shop environment.” It’s tempting to add software, up the game to a vintage roaster, and jump immediately into direct sourcing, but it’s important to focus on developing the core of a profitable roasting company and keep costs down. Though it was groundbreaking several years ago when Benetti’s shared a roasting space with another Kansas City roasting company, nowadays roasting collectives and shared roasting spaces are springing up throughout the country.
Starting simple and small as a principle applies to green coffee as well. Many young, small roasters start out by buying from micro-seller The Coffee Shrub, which offers great coffees with full transparency and will break bags into smaller shipments. Matthew Toomey, founder of Boomtown Coffee Roasters in Houston, says, “At first I didn’t keep much green on hand. I went the Sweet Maria’s route, which helped me learn distinctions between origins and processing. From there I established relationships with local importers. I go through fifteen to twenty bags a month now, but at first I could by a bag and it would last all month!”
Learn the routine of requesting, roasting, and cupping samples, and develop relationships with importers who can give you exactly what you need. For cash flow purposes, note that most importers don’t extend credit terms until a buying relationship has been established. What coffees a new roasting company purchases depend entirely on its projected customer base. The new roaster may want to highlight light-roasted single-origin coffees, while the customer base wants a dark-roasted blend. There’s plenty of room for dialogue here, and gradual change of drinking habits, but roasters must be realistic about offerings.
Retail and Wholesale
Wholesale and retail are different animals as well. The modern wholesale roaster is generally expected to fulfill a wide variety of services, from leasing and maintaining café equipment for clients to training the clients’ staff so they represent the coffees well. Depending on the target market, the roaster may be required to keep a large range of green coffees in stock, which increases the amount of cash in hand. Some markets will demand you become skilled at blend development. (Proprietary blends are still one of the strongest wholesale products.) Helt remembers the wholesale growth at Benetti’s as challenging, since there was already so much good coffee in Kansas City. “Because of the competition, we had to start out with some more challenging accounts that had been open for a while and were struggling, or that had gone through multiple roasters in a short period of time. This gave us a chance to learn about the logistics of making it all happen and what it’s like to deal with customer concerns about your product.”
Retail coffee sales depend on building a dynamic coffee community that regularly buys whole-bean coffee to brew at home. Keeping coffee sales largely in-house reduces the green coffee variety needed (ten years ago, a café was expected to serve many coffees; now a seasonal stock of three to five is normal). When Rise Up Roasters transitioned to roasting for itself, it was moving around 600 pounds of coffee a week, says Cureton. “Our goal was to seamlessly transition our core coffees, and we had a lot of anxiety over it—six and a half years of loyal coffee drinkers! Our customers were very excited for us, and we built the roaster in a customer-facing way so they could see the whole process. We had strong retail whole-bean sales in our shops then, but it’s only increased since we started roasting.” Allen adds that the most important step to selling coffee, whether wholesale or retail, is, “Defining your UVP [unique value proposition]: what makes you different from other roasters? Lots of roasters buy the same coffees, roast it the same, and customers can tell. Personality and follow-up with potential clients are important.”
What is success for a coffee roaster? Definitions vary, but in the end, make it personal. By all means, learn from those you admire, but adherence to your individual vision will bring an authenticity to your business that no amount of imitation and observation can hope to replicate.
—Emily McIntyre is a regular contributor to Fresh Cup. She is a founder of Catalyst Coffee Consulting.