Friendly Competition: There is No “I” in Coffee

By Lily Kubota

Mac vs. PC. Facebook vs. Twitter. NBC vs. ABC vs. Fox.

We live in a world of competition, one in which companies knock their opponents in ads, product devotees push their favorites and make fun of the others in YouTube videos, and customers are expected, always, to choose a side. It is, we’ve been taught, the way of business, the way of capitalism and consumerism. Beat the competition to a pulp and leave it lying there, gasping for air. That, we’re taught, is the only way to win at business.

Of course, it’s not the truth. There is also another way, one that pervades the specialty coffee industry, and one that is perhaps best exemplified every year at the Annual Roasters Guild Retreat, where roasters gather—not just to learn and create friendships—but to give away their best-kept secrets, assist those who are just starting in the industry, and celebrate the success of their closest competitors.

It is, in essence, the antithesis of competition. And, yet, it works. As Shawn Hamilton of Java City, a founding member of the Roasters Guild, comments, “Even though we are all competitors, we actually rarely run across one another’s path in the marketplace.”

He goes on to say, “The real benefit of the Roasters Guild, and this event, is that it makes us all a little better at what we do. The better we get, the better specialty coffee as whole gets. The better specialty coffee gets, the more consumers will gravitate towards it, bringing all of us more business.”

All For One, One For All

This sense of community in the specialty industry is not exclusive to roasters, by any means. These interactions and relationships extend to every level of the supply chain. In coffee, every link in the chain is dependant on the others. This reliance and interdependence has become particularly evident in roaster-producer relationships in recent years, as the trade models have shifted to take into account the hardships that are faced by producers and the affect that these hardships have on the availability of specialty coffee.

These global issues were examined at one of the highlights of this year’s retreat, the Roundtable Discussions. Participants chose to discuss one of these four topics: 1) Will there be enough supply of specialty coffee? 2) Is the Q Coffee System relevant? 3) How can Relationship Coffee survive a $2.00+ market? 4) Is Fair Trade dead?

The moderated discussions were open for a given period of time, and then the tables reported their conclusions to the group as a whole. New roasters found themselves at the table with some of the most influential people in coffee, discussing issues that will affect our ability to obtain and enjoy specialty coffee as we know it. The relaxed atmosphere of the Roundtable format seemed to lend itself to an open dialogue where participants could express their opinions, correct misconceptions, and perhaps begin to craft plans for action. The intention for this activity was not for participants to leave with all the answers, but rather to ask the questions and work together to identify areas of opportunity for the industry.

One of the key themes that emerged from these discussions was the idea that if we, on the consuming side of the equation, don’t look out for those on the producing side, the result will be not only the continued hardships of so many coffee producing families, but the reduced availability of specialty coffee. One of the topics at this event has been the subject of much discussion on the Internet, in the media, and at industry events as of late. Direct trade, also referred to as “relationship coffee,” has gained popularity in recent years, although there are a few roasters who have been clear pioneers in the movement. To varying degrees of success, roasters are adopting the model to address the desire to pay a fair price to the producer, as well as ensuring the sustainability of their supply of specialty coffee.

When a roaster forms this type of relationship with a farmer, they are able to assist in building infrastructure, suggest quality improvements, and ultimately improve the producer’s chance at success, as well as their own.

“The people who are the most successful in their direct trade programs are the ones who realize the importance of their partners in the supply chain and who have been very clear with how they work with everyone in that chain,” says Christopher Schooley of Coffee Shrub. “I think that where direct trade has run into problems is in the language. It’s not the intention of the people using a direct trade model, but every story I’ve read about direct trade in the non-industry press has said something about ‘cutting out the middleman’ and are vague at best with how a successful direct trade program truly works. It’s not about cutting out a ‘middleman,’ it’s about working with the right people in the supply chain and being involved in the whole process.” This sentiment was echoed in the Roundtable Discussion at the Roasters Guild Retreat. Most attendees expressed a desire to have the key players of this movement sit down at the table together and come up with a common language that can be used to clarify the terminology to the consumer, as well as within the trade.

As more roasters jump on the direct-trade bandwagon, the original adopters of the model have had to adjust to a more competitive landscape.

“We’re at an interesting crossroads with direct trade right now,” says Aleco Chigounis of Stumptown Coffee. “With more folks ‘using’ this system, there are some that not are taking advantage of the virtue of the term. They’re not actually establishing relationships with farmers directly (affecting quality positively, negotiating farmgate pricing at sustainable levels or have even been to the farms in some cases) or controlling the rest of the supply chain transparently.” Chigounis agreed that in order for direct trade to be sustainable, there must be a common understanding within the industry of how to implement a successful and legitimate direct trade model.

For as much discussion as direct trade has received lately, another of the Roundtable topics, the Fair Trade program, has also received a fair amount of attention, and some of it not so positive. There is a sense among roasters that Fair Trade has not achieved its goal of paying a fair price to the farmer, not to mention the shortcomings with regard to quality. Many of the companies who have recently adopted the direct trade model have abandoned the Fair Trade program for some, if not all, of their coffees.

However, as Schooley comments, “I don’t think that [direct trade] is meant as an industry-wide replacement for any other programs, but it works on a company to company basis for roasters who have the resources to do it right. I do think that smaller roasters should use the concepts of direct trade as inspiration for how they work with their importers and green coffee suppliers, looking for that level of transparency and information and asking the right questions about how this coffee got here.”

Although some companies are still finding success with Fair Trade, in order for it to be widely recognized as a solution to this humanitarian concerns, it needs to evolve and address some of the concerns that currently being raised.

In the coffee industry, as in any industry, competiveness is always present. There are always new faces appearing on the scene, and each of these new faces represents potential lost business. But the important competition isn’t roaster vs. roaster. And it certainly isn’t roaster vs. farmer vs. retail store. Instead, our true competition comes from outside our own industry—scarcity, poor quality, bad business practices: These are our real competitors.

Business is tough, especially in this economy, but if the sense of community that is present and tangible in the coffee industry can be harnessed to bring people together to discuss these important issues, we can be assured that not only will everyone along the supply chain be happier and healthier, there will also be a sustainable supply of high quality coffee.

Lily Kubota has spent the last two years as the communications specialist for the SCAA. She started her career in coffee at age 15 with her first job as a barista, and hasn’t left since. Much to her delight, she is able to make espresso drinks in the office for anyone who will let her.