November 2017 by CoffeeTalk Magazine

November 2017 | Vol. XXX No. 11 www.coffeetalk.com

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HIGHLIGHTS

10 THE RISING FUTURE OF RTD COFFEE What Happens When a Can of Coffee Looks Like a Can of Soda? 14

for Women Coffee Producers 16

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Contents

The View WCR Verified Program

New Certification Addresses Coffee Where It Begins—The Seed

Second Annual Ernesto Illy International Coffee Awards

World’s Best Coffee Producers Take Center Stage at United Nations

Congratulations Ken Shea

12 14 16

Roaster's Rock The Rising Future of RTD Coffee

What Happens When a Can Of Coffee Looks Like A Can Of Soda?

JavaU's Interview with Karen Cebreros Gender Equity and Access to Credit for Women Coffee Producers

Coffee Service Corner

A Watershed Time for The Coffee Service Industry

NAMA Coffee Tea & Water Show Listings

Newsbites

Calendar

Advertiser Index

Feature

8 4

Sustainable Tools & Technology November 2017

THE VIEW Kerri Goodman

raditionally November is our annual issue dedicated to sustainability. Here you will find topics and considerations to continue a bright future for specialty coffee addressing significant concerns ranging from climate change to economic survival and more. This week, 27 of the worlds best lots of coffee from nine different countries were invited by illy Caffe to compete in “Best of the Best” coffee competition at the United Nations. It was an inspirational event that lifted my heart and gave me pause with 100% of the emphasis on the producers who make specialty coffee possible. The history of this award is especially meaningful to me. When I founded CoffeeTalk back in 1994, my knowledge of the intricacies and nuances of the specialty coffee supply chain was limited. Being a young entrepreneur, I recognized my need for industry leaders as mentors. Thank goodness, I was not shy about asking for help from the best of the best. I was so very blessed that Dr. Ernesto Illy was one of the first to join CoffeeTalk’s Advisory Board. His guidance and knowledge, passion and caring, lead me on a journey of discovery and respect.

Today it is all the rage to talk about “Direct Trade relationships.” This “Third Wave” concept was, in fact, created 26 years ago by Dr. Ernesto Illy, the pioneer of this movement and genius far ahead of his time. Dr. Illy crafted the first competition for green coffee based upon quality and taste and directly rewarded those producers. It was his vision that went on over the next few decades to create such esteemed awards and certifications as Cup of Excellence, Rainforest Alliance Certifications, and more, which have directly influenced the lives of farmers and the quality of specialty coffee available today. I was honored to again be asked to be a judge on their panel for this illustrious award. All of the coffees were marvelous, but, even more amazing, was the presence of the actual producers many of whom had never left their homelands, here in New York City at the United Nations. To see the excitement, joy, and wonderment, of the producers experiencing consumers’ direct appreciation for what they do was inspiring. And so I hope and dream that this tradition of excellence continues, for this is essential to the future of specialty coffee. Until consumers become aware of the immense amount of labor, passion, and sacrifice required to produce that cup of coffee and directly rewards these producers, the future of specialty coffee will continue to be in jeopardy. Congratulations to all of the finalists, and most especially to José Abelardo Díaz Enamorado of Honduras, your dedication is an inspiration.

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WCR Verified Program New Certification Addresses Coffee Where It Begins—The Seed

by Hanna Neuschwander, Communications Director, World Coffee Research

e are accustomed to thinking about the coffee value chain beginning at the farm. But in many cases, it begins before that—at the nursery that produces the seeds or plants that farmers grow in their fields. The coffee industry as a whole is dependent on coffee farmers being able to grow plants successfully. If the seed is bad—damaged, diseased—or turns out to be the wrong type, all the potential of that seed is squandered. WCR VerifiedSM is a new pre-farm certification program for coffee nurseries and seed producers, provides for the first independent, science-based quality control and assurance for coffee nurseries to ensure the health and genetic purity of coffee plants sold to farmers and major renovation programs. The program is managed for transparency and independence by thirdparty certifier NSF International. Does coffee really need another certification program? In this case, yes. Billions of coffee trees around the world require replanting. The problems range from trees that are too old (in some regions, the average age can be over 60 years), to trees that are susceptible to major pests and diseases like coffee leaf rust and CBD, to trees that can’t keep up with changing climates. But in coffee there has been no global standard for evaluating whether the plants farmers purchase are healthy. And the evidence is that with astounding regularity, they are not as healthy as they should be. Similarly, there is no system for ensuring that the plants are the correct one—genetic purity is shockingly rare. Seed certification for most major crops has been standard in developed countries for 100 years. But coffee growers around the world—who make their living from their plants—do not have the same assurance as hobby gardeners in the US or the UK. Receiving poor quality, and even fraudulent, plants is a norm for coffee farmers. These problems mean that farmers face lower productivity and higher risk on their farms. What it means to be sure When a farmer buys plants or seeds produced in a certified nursery, he or she can expect the plant to perform to the variety standard (for variety standards in Central America, see the Coffee Varieties of Mesoamerica and the Caribbean). The consequences of not having this assurance can be dire. For example, if a farmer in a rust-prone area intends to buy rust-resistant plants, but the plant he or she is sold is the wrong variety and not rust-resistant, it could mean the loss of all of the farmer’s profits for the year. If a severe

epidemic were to emerge, it could be the loss of their farm entirely. Conversely, sourcing Verified seed or plants reduces risk—not only for farmers, but also through the supply chain. The WCR VerifiedSM program was chosen by Conservation International to test and verify the health and genetics of rustresistant coffee trees provided by Starbucks to farmers in Mexico, Guatemala and El Salvador as part of the roasting company’s One Tree Per Bag program. Nursery audits, the core mechanism of the WCR VerifiedSM program, help nurseries identify and correct weak points in their practices, while DNA analysis and transparency auditing of the nursery’s seed supplier ensures genetic purity. WCR Verified® nurseries are evaluated on the following criteria: • Nursery standards: The nursery follows best practices for raising healthy, disease-free plants. • Genetic purity. The coffee variety has been identified using WCR DNA fingerprinting so farmers can be certain they are buying the correct variety. • Education. The nursery makes information about the agronomic performance of different varieties available to farmers so they can make an informed choice. • Breeder’s rights. The nursery gives credit to breeders and their rights are repsected. Facilitating access to high quality plants Seed farms and nurseries certified to the WCR VerifiedSM protocols are listed in an online directory tied to the World Coffee Research coffee varieties catalog at varieties.worldcoffeeresearch.org. The catalog currently features 38 varieties cultivated in Central America and will expand to Africa in 2018 and globally after that. Coffee farmers interested in sourcing high quality plants can consult the catalog and identify which varieties are offered by certified nurseries. This is the first time a global directory of varieties has been available for coffee. As the WCR VerifiedSM program and the WCR coffee catalog expand to cover new production regions of the world, it will become the industry’s most essential resource for coffee variety information. Independent and transparent WCR began work to develop the program in 2015 and engaged NSF International in 2017 to develop it into a third-party certification program. WCR appointed NSF International to act as the WCR VerifiedSM Program registrar, to manage the certification process and to oversee the integrity of the program to ensure transparency and independence. Audits and certification for coffee seed producers and nurseries have begun in Central America, with expansion planned to coffee production areas in Mexico and South America, and then the program will be rolled out globally. Creating opportunity World Coffee Research created the WCR VerifiedSM program to be a fundamental source of assurance for farmers and coffee buyers. The program assists the sharing of horticultural and agricultural knowledge for coffee, improves access to information of the most appropriate coffee varieties for growers.

How to participate Interested nurseries and seed providers can sign up to participate in the WCR Verified program online at varieties.worldcoffeeresearch.org/verified. November 2017

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Second Annual Ernesto Illy International Coffee Awards World’s Best Coffee Producers Take Center Stage at United Nations

n international panel of culinary and coffee experts from around the world convened on October 17th at the United Nations to evaluate the world's highest-quality coffee lots grown in nine countries as part of Ernesto Illy’s Second Annual "Best of the Best” International Coffee Award.

who are the backbone of our industry to be featured at the United Nations, an organization truly symbolic of united accord.”

Judging criteria included aromatic richness, complexity, balance, elegance, aroma intensity and strength. After several rounds of blind tastings, coffee grown by Honduras's José Abelardo Díaz Enamorado was selected as the "Best of the Best.”

• Mark Pendergrast (Jury Chair): A best-selling American author, Pendergrast is known throughout the coffee community for his books Uncommon Grounds: The History of Coffee and How it Transformed Our World, and Beyond Fair Trade: How One Small Coffee Company Helped Transform a Hillside Village in Thailand.

The top-scoring coffee lot was named from among 27 of the world's best lots from the 2016/2017 harvests in nine countries, at a gala attended by representatives of each grower and delegates from each nation. According to a press release provided by illy, award winner Díaz Enamorado and his wife, Daysi Clemencia Reyes, began planting coffee in 1966 in the village of El Chimizal, with an initial area of 3.5 acres, in the region of Erandique. Alongside Honduras, coffee lots from Brazil, Colombia, Costa Rica, Ethiopia, Guatemala, India, Nicaragua and Rwanda were chosen to compete following intensive analysis at illy's Quality Lab at its Trieste, Italy headquarters. All nine finalists will comprise the legendary illy blend, known for decades for its unparalleled richness, complexity and consistency. "It is an honor and a pleasure to recognize Mr. Díaz Enamorado for his achievement, and that of all of our finalists, which is nothing less than producing the highest-quality coffee in the world through sustainable methods,'" said Andrea Illy, chairman of illycaffè. According to illy, the award recognizes excellence in raising coffee of the highest quality through sustainable means. The award celebrates the company's hand-in-hand work with farmers to realize its dream of offering the best coffee to the world. illy sponsored the representatives of all 27 finalists to New York City for Monday's proceedings at the United Nations, followed by a gala at the New York Public Library to honor the extraordinary achievements of all growers. In addition to "Best of the Best," a "Coffee Lovers Choice" award, determined by blind consumer tastings, was awarded to Juan Carlos Alvarez from Costa Rica. The “Coffee Lovers Choice” award was sponsored by illy partner United Airlines. The international panel of culinary and coffee experts judging the lots included CoffeeTalk Media Publisher, Kerri Goodman, who said of the gathering, “This was an inspirational event that lifted my heart and gave me pause with 100% of the emphasis on the producers who make specialty coffee possible,” said Goodman. “It was truly fitting for these hard-working farmers

Other panelists included:

• Caterina Ceraudo: Ceraudo is the chef behind Michelin Star-holder restaurant Dattilo, located on her family's biodynamic farm in Calabria, Italy. She is known as one of Italy's preeminent chefs for her simple yet innovative takes on traditional Calabrian cuisine. • Pino Cuttaia: Cuttaia is the celebrated chef at the helm of the Licata, Italybased restaurant La Madia, which he opened with his wife in 2000. Known for his interpretation of Sicilian cuisine, Cuttaia has received two Michelin Stars. • Richard Martin: Martin serves as editorial director of Food Republic, which he launched in 2011 and now reaches millions of food lovers every month. He was a founding editor of the groundbreaking culture magazine Complex. • Denise Mazzei: Mazzei is an assistant professor of business management at the Culinary Institute of America, and an alumnus of the school herself. An entrepreneur at heart, Denise owned her own foodservice business for eight years. • Josimar Melo: A food and wine journalist for leading Brazilian newspaper Folha de S. Paulo, Melo publishes a widely anticipated annual guide to cuisine in São Paulo, and presides over the Latin America Jury in Brazil for the World's 50 Best Restaurants. • Fernando Arturo Osorio Rodriguez: Director of Quality at Colombia's Almacafe S.A. – FNC, and an appointee to the Colombian National Coffee Grower's Federation, Rodriguez is deeply experienced in coffee's numerous physical and sensorial properties. • Ansha Yassin Suileman: Ethiopia-based Suileman is the managing director for CO QUA trading plc. She is a coffee expert in every aspect, specializing in coffee quality inspection, among numerous other skills. According to the company, coffee lovers will have a chance to judge — and enjoy — for themselves, when illy makes each of nine finalists’ beans available for purchase as a single origin next year at select illy Caffè locations.

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On Monday, November 6th at NAMA's Coffee, Tea and Water Show, Ken Shea, President of Ken Shea & Associates and V.P. of Coffee Services for G&J Marketing and sales, will be recognized for his contributions to the coffee service industry. “An industry veteran of almost 40 years, Ken has made a major impact working in every facet of convenience services, as a distributor, manufacturer, operator, broker and a consultant,” said Stu Case, Chair of NAMA’s Coffee Services Committee. “For his leadership, his passion for advancing coffee services and his commitment to helping his industry colleagues, we are delighted to honor Ken as this year’s Coffee Legend.” We are honored to invite Ken into NAMA's Coffee Legend Hall of Fame. Please join us in celebrating Ken's achievements as we honor him at the 2017 Coffee, Tea and Water Show.

Roasters Rock

EUROPEAN ROASTERS: SAME ROASTING PASSION – DIFFERENT BORDERS by Rocky Rhodes

assion for coffee crosses all borders, oceans and continents. The differences come in style of roasting but not passion. European roasters are no exception.

On a recent romp through several countries in Europe on a tour to visit roasters young and old, big and small, consistent observations could be made. This article will explore some of those. Information in the roasting world is travelling at the speed of the internet. Thirty years ago there were no opportunities to take any classes on roasting. The only way you improved your craft was by doing. Then the Roasters Guild(s) formed and people exchanged ideas. Now you can learn about roasting on YouTube and other media vehicles. There seems to be a downside to this as well: EVERYBODY has an opinion about the BEST way to roast. Often these opinions contradict each other from post to post and video to video. This has left students around the world wondering, “What is the right answer?” In Europe is found an attitude that is a little different than say Asia. They have

decided to just figure it out! The attitude on roasting is much the same way a teenager learns to drive; “Thanks for the training. I’ll take it from here.” They may have a few fender-benders along the way but will be doing things their own way. Everyone wants to perfect the craft. While the Europeans on the whole are learning by doing, there is still a desire to validate what you are doing with others. This has driven the growth of the Roasters Guild Europe as well as regional events like the Nordic Roasters Forum. What is interesting to observe in Europe is the trust level between roasters. In the US we have adopted the concept of “whatever I can do to make another roaster stronger makes me stronger as well” and support each other eagerly. The Europeans are getting there but still have cross-border uncertainty. Often ‘we Americans’ think of Europe as being one country with several states. It most certainly is not! This can understandably lead to sensitivities when sharing knowledge. The guilds and forums provide a neutral area, a UN of coffee if you will, where ideas are shared not only by the participants but by ‘outsiders’ that

12 November 2017

come in to lecture. At the Nordic Roasters Forum last month they heard from a grower in Costa Rica about the pitfalls for both buyers and sellers on Direct Trade. The roasters all got to compete against each other with coffee from that farm. In this way they learned about different roasting styles for the same coffee in a way that supported an ‘outsider’ thereby reducing concerns about sharing ‘secrets’. The desire to collaborate is driving the success of the guild and making European coffee roasting some of the more interesting in the market. There seems to be a need to differentiate by being ‘bold’. There are thousands of roasting companies in the world. It used to be that just by roasting you were differentiated in the market. In many markets that is still true. Often to us in the industry roasting is ‘common’ even though the majority of the consuming public still does not know that coffee starts on a tree much less that roasting makes a difference in taste. New roasters in the market are trying to make a name for themselves by doing something different. This is true in Europe as well. One of the trends is to stick with lighter roasts and celebrate single varietals. This is an awesome advance in differentiating in Europe. After all, what do you think of when you think of French Roast or Italian Roast? DARK! Now you can sit at a sidewalk café in France and sip a carefully crafted natural processed coffee from El Salvador brimming with orange and chocolate flavors. But for some, this is not a BOLD enough difference anymore. This is where innovation sometimes trumps logic or even taste buds. An example is the drive to be “The Lightest Roaster” in the country. They often view the first crack as something to be avoided and that the taste of cardboard should be celebrated. Luckily market forces play an important role in weeding out the ridiculous from the quality roasters. That being said, when you travel to the Nordic countries you can find these Uber-light roasts that have actual flavor development because they are actually innovating in the area of elongated pre-first-crack roasting. But they do it to both improve on quality AND to differentiate.

Fame often trumps experience when looking for mentorship. A disturbing trend in coffee, as well as other industries, is believing that being famous somehow makes you the authority on a subject. Europe is filling up with roasting, brewing, and barista championships. The winners of these events really ought to be celebrated. They work hard and accomplished something others did not. This does not, however make them expert in anything other than winning that competition. If they are expert in their area it is because they have studied, practiced, and continue to perfect their craft. Social media plays an important role in Europe’s roasting community. It does all over the world really, but with new roasters in emerging markets it seems to have an especially heavier weight. It seems a common mistake that if someone has 10,000 followers they must know what they are doing. Perhaps. But perhaps they are really good at getting ‘likes’ and should spend more time learning how to roast. The point is to be extra skeptical about learning from internet celebrities. They MIGHT be experts, but then again they might just be famous. More than other parts of the world, Europeans tend to have a deeper sense of skepticism that serves them well in this area. So European roasting is alive and well with passionate people doing creative things. This new wave is dispelling the common vocabulary of French and Italian roasts as they find flavor in lighter coffees. Their collaboration is tentative but working. This will make the entire continent a place to find great coffee. Rocky Rhodes is an 18 year coffee veteran, roaster, and Q-Grader Instructor, and his mission now is to transform the coffee supply chain and make sweeping differences in the lives of those that produce the green coffee. Rocky can be reached at rocky@ INTLcoffeeConsulting.com Photo by Trish Rothgeb

The Rising Future of RTD Coffee What Happens When a Can Of Coffee Looks Like A Can Of Soda?

he lines between coffee and the rest of the refreshment beverage category are blurring, which could mean a growth boom for coffee in the years to come.

In a new Rabobank report, “Coffee Joins the Beverage Party,” we describe how coffee consumption is becoming an all-day affair. Instead of primarily drinking it at breakfast in the home, more and more consumers – especially younger ones – are enjoying it all day and away from home as it becomes more premium and more convenient. Younger consumers are forming a new relationship with coffee – one that invites increased innovation and branding, while opening up new consumption occasions. The potential negative tradeoff is that coffee could lose its traditional “health halo” as it gets closer to the world of sugary refreshment beverages. So far, there are no signs of slowing down – we estimate that the U.S. ready to drink (RTD) coffee segment should double over the next five years, making it worth $6 billion. Crossing the hot/cold line Coffee has often run parallel to the refreshment beverage category as the difference between hot and cold placed a mental and physical barrier between the segments. This separation is beginning to disappear. Now when you enter most grocery stores there is an array of RTD coffee beverages right next to the other nonalcoholic beverages. There is no clean break between the coffee brands and refreshment beverage brands. We see numerous cross-over products, with brands such as Monster, Califia, and Gold Peak getting into coffee from diverse segments. At the same time, products like Stumptown sparkling cold brew with flavors reads closer to a traditional refreshment beverage. As the lines between categories blur, we expect that consumers will increasingly view coffee as an extension of the larger non-alcoholic beverage segment as opposed to its own category. Key trends driving out-of-home consumption Coffee consumption is moving out of the home, and later in the day. These two trends are certainly related and are part of the reason behind the decline in traditional drip coffee. Breaking the at-home/drip coffee connection opens up great growth opportunities for coffee retailers. Consider the difference between consumers who were introduced to coffee through a pot of Folgers brewed at home versus those introduced through the Starbucks mobile app. Data from National Coffee Association shows that more than half of coffee drinkers 19-34 years old reported having coffee out-of-home in the last day, compared to less than 1/3 of those over 50. For those reasons and more, the growth of RTD coffee is here to stay. For a long time, the RTD coffee segment was broadly an afterthought in the coffee world. The category has grown at a 14% CAGR for the last five years in the US

by Jim Watson, Senior Beverage Analyst for Rabobank, based in New York

(4% globally), but we see the introduction of cold brew as a significant catalyst to the industry. With cold brew there is a wave of new entrants to the category, with new styles of drinks becoming available, and new outlets will devote more shelf space to the category. Think of RTD coffee in the grocery/convenience channel not as a new, different way to sell coffee, but the natural path of coffee truly tapping into the most well-established, well-oiled way of getting beverages to consumers. Again, the difference in age groups is noticeable – RTD is much more popular among purchasers under 50, and stronger interest still among those under 25. Opportunities for branding The liquid refreshment beverage category is driven by branding. Of course, the beverage’s intrinsic qualities matter, but in categories with dozens (or hundreds) of choices, brand equity is core to the final purchase decision. Coffee is unlike the rest of the beverage segment in its branding. With a lower reliance on the bottle/can format, the brand plays a lesser role in our consumption. Office coffee may have some branding around single serve packs, but like coffee at home, is probably consumed out of a regular mug. When you look at the beverage menu at typical local restaurant, you may see that every single beverage is branded with the exception of coffee. This is changing, especially at higher-end restaurants, and we expect coffee to be nearly fully branded in the long run. As younger consumers drink more from RTD packages and at coffee shops, the branding of the coffee will become more important over time. This will spread slowly through the rest of the industry. Office coffee, both in terms of the equipment and actual coffee will be represented by well-known brands. On the restaurant menu, the coffee producer will be listed. Chick-fil-A offers an example from the QSR world, selling coffee drinks co-branded with its partner, THRIVE Farmers Coffee. Potential downsides As the coffee segment converges with the broader beverage category, taxes and regulations are potential downsides. Soda (or added sugar) taxes have begun to pop up on a small scale around the US, and we’ve seen taxes in Mexico, Chile, France, and Hungary, among others. The more coffee resembles the rest of the RTD beverage world, the more closely consumers and politicians will examine its health properties. Much of this leads to losing the health/natural halo around coffee products. Sitting next to soda on the grocery shelf and getting roped in to tax discussions emphasizes the sugar/caloric content of the products. While the history of RTD coffee in the US is in the Frappuccino-style/high-calorie model, this has perhaps gone slightly under the radar as a smaller part of the coffee world. Jim Watson, Senior Beverage Analyst for Rabobank, based in New York

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JavaU's Interview with Karen Cebreros Gender Equity and Access to Credit for Women Coffee Producers

CoffeeTalk Media and JavaU were honored to host Karen Cebreros, Founder and CEO of Elan Organic Coffees, Earth's Choice Organic and a Sustainable Trader with Global Coffee Trading as our Subject Matter Expert for our webinar on Gender Equity and Microfinancing for Women in Coffee. Karen is also a cofounder of the International Womenâ&#x20AC;&#x2122;s Coffee Alliance (IWCA). The question and answer portion between Producer Shane Gillispie and Ms. Cebreros appears below. The entire presentation can be viewed at www.javautraining.com/webinar-archives.

Q: How many chapters are involved in IWCA?

they were only interested in managing the money themselves which they cannot do; it has to go through a third party. Just different things happen. So, vetting the Rotary club is critical. What I've found works really well is to get recommendations from the district governor and in the case of Central America, I just happened to know the district governor through other work with Wakami, an amazing NGO. And if you don't turn in your reports when they're due, all money shuts down. Rotary International's not messing around anymore. You have to dot every I and cross every T. But, they just launched a new global grant process which is going to be, I'm going to say, a hundred times easier than in the past. You do have to make friends with the people who pull the strings on the money though. Both in country and in our country. Youâ&#x20AC;&#x2122;ve got to go to a Rotary meeting and see if somebody in that club is interested in the project. That's what you have to do in your neighborhood. Rotary, on a global landscape, is looking for new ways to partner and I think feeding people and peace are the two things they're looking at.

A: There are 22 active chapters. Each country has to go through the same steps that we did here in the United States and file for their own non-profit status which, in some countries, was almost insurmountable, particularly Ethiopia. But, every single chapter, in order to become an active member of the global movement, has to have their own non-profit status. And we have bylaws, if somebody needs to see bylaws, we can email those out. Q: What other countries are you looking to start projects in? A: I really want to start five countries at one time if we have the right partners. Basically, bottom line, the right Rotary clubs on the ground and groups like Hanns R. Neumann Stiftung to collaborate. But, World Vision said "We don't know who the heck you are. Let's see how we do in Honduras, and if you do well, we'll approach two or three at the same time." Having said that, probably, if we get the go ahead, we'll jump over to Africa. I can not specify the country. Needless to say, we did workshops in Puebla at the Global Conference. Standing room only, everyone stayed until the end, everybody would like to have access to credit. So, it's not going to be my call necessarily but I do think it would be great to get some models going in the African area. And then, of course, the Philippines and Indonesia, they want it too. China too, everybody wants it. Q: What's been the greatest challenge in getting women coffee farmers involved in microfinance? A: Fear. They're just afraid to commit to taking something that they've never, ever had. Fear and confidence. But, at the end, the fact they want to feed their families always wins out. Q: How do you know which Rotary clubs are the right ones and then, and is there some sort of an instruction sheet on how someone might be able to approach a Rotary? A: That is the giant elephant in the room. Everybody says they want to do it, they want the money, they want to help you, and that is not the case. We have started down a path and been into it, I'm going to say, up to two years in some of these partnerships where the Rotary club at origin does fall away for a variety of reasons. Maybe they lost the champion within the club. Sometimes

Q: What else as a coffee industry, just the coffee industry in general and everyone in it, what could we be doing to address the poverty in the origin countries? A: First of all, I think we should ask the ICO to get data collected. People that donated a lot of money, in the millions, want data. How many women work in coffee in each of these countries? I don't think that's a lot to ask for the ICO to ask each country. Can they roll up some figures so we can present some appropriate information relative to global grants to whoever is funding projects that we need to work on? We need to feed people. The industry is what? One of the third most powerful industries in the world next to, I'm going to say guns, arms, and liquor. But, everybody likes to compare us to oil. Well, they're both very dirty industries but we have the power to change the way we live on this planet. And, I have to put in a plug for organic because that's my thing. When I started in organic in '89, back then, organic people were saying the planet is... 50% of the pollution on the planet is caused by agriculture, and within the agriculture, it's coffee, tobacco, and cotton are the most heavily polluted products on the planet. We have to stop chopping the rainforest down, polluting the planet. I mean, in Chiapas, we had our first organic coffee conference, I believe this is in '86, and a farmer said, an indigenous farmer people are interviewing and saying, "Why are you going back to organic?" He goes, "Because our soils are tired, our waters are polluted. Oh, and by the way, our kids are sick and dying and the fish are gone. We have to. It's not a choice." I don't know if it's too late. Let's be optimistic. Give women the tools to farm in harmony with nature.

16 November 2017

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Coffee Service Corner

A WATERSHED TIME FOR THE COFFEE SERVICE INDUSTRY

y definition, Mr. Noah Webster defines “watershed” as “an important point of division or transition”. Years from now, I believe that our industry historians will look back at the years 2015-2018 as a notable time of transition for the Coffee Service Industry which has witnessed a number of significant events that have marked time since the mid 1960’s. In the half century existence of “OCS”, there have been a number of interesting and exciting events that have affected the shape and course of our business. These events include: • The introduction of fractional pack coffees • Development of thermal decanters and air pots • The Coffee Shop phenomenon • Single Cup systems...just to name a few. From my observations, I note three evolving realities that are truly changing the face of our great industry for both operators, suppliers and distributors. INDUSTRY ROLL-UP RESUMES For decades, no single operating company has commanded more than single digit percentages of market share until this year. Through robust organic activity, increased activity on the acquisition trail and a growing network of franchises, Canteen appears to be the first operating company to surpass ten percent share of the OCS market. Canteen is not alone in the hunt for acquisition candidates and territory expansion. Aramark, First Choice, DS Services and Texas based powerhouse Accent Food Services have been very active of late. And some activity is taking place outside of the continental 48 states. Unlike the Vending and Micro-Market classes of trade, OCS remains a very fragmented industry and it is unlikely that we will see such market domination in Coffee Service short term but we are certainly moving nearer consolidation than away from it. It’s a great time to be an OCS operator as a business builder and/or as a seller. Driven largely by the expanding presence of Millennials in the workplace, office subsidies of offerings beyond the cup have never been greater. And this brings up our next evolving reality. OCS – MORE THAN COFFEE! In my 17 years as an operator, serving in various roles that supported our Purchasing and Supply Chain departments as well as Route Operations, I frequently received ad hoc requests from our field generals for new snacks and drinks that were mostly one-off office account opportunities that did not appear to be indicators of broader, profit expanding opportunities. But in retrospect during my last year, I did notice an increase in new product requests, again for snacks and drinks. And I summarily dismissed those requests as one-offs. (One of my last operator missteps). As I re-entered my consulting and broker life and began interacting with many of my operator friends who were now customers and that I found were much wiser than me, I discovered that a large number had already identified ticket building opportunities beyond coffee and allied products and were adding double digit percentages of profit to historically flat accounts.

by Ken Shea

As an operator, regardless of one’s motivation to sell the business or to keep it, these new sales opportunities, which in many cases require little or no asset investment, will help one optimize both objectives. After all, every divestiture formula and algorithm begins with top line gross sales and profits. The menu opportunities do not end with snacks and traditional beverages. Sparkling water, Cold brew RTD drinks and kegs, better for you offerings and much more are being subsidized by offices. It is reported that Millennials snack more than other generations and many offices allow non-traditional work hours. Having refreshments within an arm’s reach has never been more important to the office. Providing these refreshments has never been more potentially lucrative to the operator. EXPANDING POTENTIAL CUSTOMER BASE The census bureau reports that there are more than four million offices with employees numbering twenty persons and less. Very few operators historically would target such size accounts for DSD service. While I doubt that very few of these offices go without coffee and water, the way they source their products often exclude the OCS operator. Office supply companies, Amazon and other on-line fulfillment sources provide a level of fulfillment but in many cases leave gaps. Weight and dimension restrictions, item fragility and subsequent costs limit a number of menu choices. There is no “service” in these scenarios. While few operators have made the move to build full service routes than include the smaller offices, the question remains as to the viability of such a business. With my operator hat on, I believe that I could add perhaps one additional limited service stop per day to an existing route and schedule the small office stops at four week intervals. I would place a very low cost, disposable coffee appliance, build a full menu of allied products, snack assortment and secure the water business with a point of use unit. A ten person office, with the water unit rental, should easily generate $125 in sales per four week cycle. This volume represents an additional $30,000+ in annual route revenue at a very handsome GP. Any takers? The National Automatic Merchandising Association continues to recognize industry trends and keeps the membership apprised of same and does a superb job in providing education venues at its industry gatherings. It is indeed a good time to be in the OCS industry. COFFEE, TEA AND WATER SHOW By the time most of you receive this issue of COFFEETALK, many will be in Grapevine, TX at NAMA’s CTW show. If so, please stop by for a visit at the SOCIALFEEDIA booth. This will be a good opportunity to see some interesting snack and beverage solutions as well as a Payment APP especially designed for the office. I hope to see many of you there. Until next time - Ken

18 November 2017

Ken is President of Ken Shea and Associates and also serves as V.P. of Coffee Service for G&J Marketing and Sales

Please Make Sure to Visit These NAMA Exhibitors Follett Corporation follettice.com Follett ice machines feature chewable, bite-sized ice that adds a new dynamic to drinks. Preparing iced coffees, teas and smoothies has never been easier.

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Fuji Electric Corp. of America 620 americas.fujielectric.com/fecoa_products/ commercial-grade-single-serve-coffee-machine (201) 490-3935 Fuji Electric offers commercial grade single-serve bean-to-cup coffee machine with 20 adjustable parameters for your perfect cup and easy maintenance.

Gavina Gourmet Coffee 501 gavina.com (800) 428-4627 When it comes to superb coffee and exceptional service, Gavina is the preferred coffee partner for retailers and entrepreneurs everywhere. Gavina Coffee: Grounds for Great Partnership.

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Service Ideas Inc. 613 serviceideas.com (800) 328-4493 Service Ideas is a worldwide provider in the service industry. We strive to bring quality products and services to the food, beverage and hospitality markets.

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Lacas Coffee Company 723 lacascoffee.com (800) 220-1133 Servicing the Food Service, OCS, and Vending markets with branded & private label coffee programs. Craft roasting since 1921.

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ATTENTION VENDORS!

Remember to Claim your Free Listing 3 EASY STEPS TO MAKE SURE THOUSANDS OF INDUSTRY BUYERS CAN FIND YOU! 1. Login using your company’s domain name - we will then send you an email with a link to a pre-filled form with all of your current information on file.

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Java Jacket provides the best We offer the largest selection insulation of all sleeves on the of vacuum sealed containers market. Protects customers in the world! We have from hot or cold to-go developed a patented vacuum beverages, and provides a open and close system that more grippable surface than acts exactly the same way as other coffee sleeves. a one-way degassing valve, allowing natural gasses to escape without allowing oxygen in. Perfect for Coffee & Tea, guaranteeing freshness & flavor. Simplicity that works.

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NewsBites AEROPRESS Movie Coming Soon: The Story of an Iconic Coffee Maker AEROPRESS MOVIE is a short documentary produced by European Coffee Trip that reveals the story of the AeroPress—from its inventor's workshop in California to the competition stages of AeroPress Championships around the world. It explores what makes people so excited about this odd looking yet iconic coffee maker. “After 3 years of creating coffee videos and short films we have noticed that people are incredibly passionate about the AeroPress,” says Ales Pospisil, co-founder of European Coffee Trip. “One of our biggest dreams has been to create a coffeerelated documentary. Now, we are in love with this story and we have decided to ask coffee lovers for help through our Kickstarter campaign,” continues Radek Nozicka, director of AEROPRESS MOVIE. AEROPRESS MOVIE's Kickstarter campaign launched on October 10th, 2017, and the filmmakers aim to release it in autumn of 2018. For more information, visit Ales Pospisil, European Coffee Trip, ales@ europeancoffeetrip.com. 2017 World AeroPress Championship is going to Seoul! On November 9th 2017, coffee making champions from over 60 countries will converge in Seoul to battle for the questionablyglorious title of ‘2017 World AeroPress Champion’. This most curious of events will take place at Cafe Alver, located in the so-hip-ithurts neighbourhood of Gangnam. The World AeroPress Championship is a multi-round, elimination tournament of competitive coffee making. Three competitors per round have just a few minutes to brew a single cup of AeroPress coffee and present it to three judges. The winner progresses to the next round, while the losers are eliminated. There will also be dazzling MCs, music from DJ Homework, some of Seoul’s best food trucks on the forecourt, and Magpie Brewing Co. on board to ensure the free beer flows all night. Early Bird tickets are on sale until October 23rd. General Admission tickets thereafter. For more information and tickets, visit the World AeroPress Championship website at aero. press/2017.

Joffrey’s Coffee Partners with Café Femenino to Empower Women Coffee Farmers Around the Globe Joffrey’s Coffee and Tea Co. is proud to announce their partnership with Café Femenino, a coffee brand on a mission to enhance the lives of women in coffee producing communities across the globe, one sip at a time. Café Femenino ensures that women coffee producers are valued, supported, and paid premiums for their coffee. Women across the world have noted many positive cultural changes including recognition for their work and increases in school attendance among girls in their communities. Joffrey’s donates a portion of their proceeds to the Foundation thus supporting projects in areas of health, education and clean water. Joffrey’s invites you to help support this mission by experiencing Café Femenino Sumatra, available now. This rich, earthy roast, grown in the mountains of Sumatra, is Fair Trade and USDA Certified Organic and directly supports 544 female members of Café Femenino. For more details on Joffrey’s partnership with Café Femenino, contact Giovanni Gutierrez, Marketing Director, at giovanni@joffreys.com. Oubu Jamaica Blue Mountain Coffee is now available as a direct trade, single origin concept to the US specialty coffee market. Oubu has moved away from the ‘generic’ concept of Jamaica Blue Mountain Coffee. In addition to the certificates guaranteeing authenticity, coffee from the Oubu farms is also delivered with extensive background information and data, which is unrivalled in the industry. Founder, Courtney Bramwell who grew up in Jamaica, says: “We give a voice to the people actually growing the coffee. In the process of doing that we provide detailed high, quality information on the actual and very specific origin of the coffee. This is in response to global coffee trends, where we see an intense focus on traceability, very high-quality coffee coupled with data that our customers can use directly in their marketing material.” Oubu is now available as green beans in all grades from major US specialty coffee traders - contact us at hello@oubucoffee.com for more information.

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20 November 2017

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Ana is a mother of seven children. To help feed her family she has planted a garden and so far has raised 16 chickens for added income, eggs, and much-needed protein for her family. She attends all Food Sovereignty trainings and uses what she learns to feed her family in Chel, Guatemala. Local challenges, local solutions Farmer-to-farmer training Self-managed development Empowering communities

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RECENT ARCHIVES INCLUDE OCTOBER 2017 • Water Management's Evolution Aligns with Specialty Coffee's "Waves" PRESENTED 10/31/2017 Ronny Billemon, Pentair Everpure

• Innovation in the Coffee Business: The True Power of Relationships PRESENTED 10/10/2017 Rick Peyser & Kenneth Lander

SEPTEMBER 2017 • How “Up-Cycling” Drives Economic and Environmental Sustainability PRESENTED 9/26/2017 Dan Belliveau, CEO of Coffee Flour

• The Role of Barista Competitions for the Future of the Industry PRESENTED 9/19/2017 Heather Perry, VP Klatch Coffee

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Advertisers Index Company.................................................. Phone............................... Web.........................................Page.............CTW Booth Add a Scoop Supplements.....................................(415) 382-6535............................addascoop.com.................................21 Brewista...................................................................(307) 222-6086..........................mybrewista.com................................19 Buhler Inc................................................................(905) 754-8389..........................buhlergroup.com...............................19 Cablevey Conveyors................................................(641) 673-8451............................cablevey.com.....................................11 Coffee Holding Company.......................................(800) 458-2233..........................coffeeholding.com............................3 Colombian Coffee Growers Federation.................(305) 532-7950...........................federaciondecafeteros.org...............23 Costellinis.................................................................(877) 889-1866...........................costellinis.com...................................19

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Curtis........................................................................(800) 421-6150...........................wilburcurtis.com................................7 Don Pablo Coffee Roasting Company...................(305) 249-5628..........................cafedonpablo.com.............................21 Flexicon Corporation...............................................(610) 814-2400...........................flexicon.com.......................................12 Follett Corporation..................................................(800) 523-9361...........................follettice.com.....................................20.................................. 712 Fres-co System USA Inc..........................................(215) 799-8032...........................fresco.com..........................................11 Fuji Electric Corp. of America.................................(201) 490-3935...........................americas.fujielectric.com/................4................................... 620 Gavina Gourmet Coffee..........................................(800) 428-4627..........................gavina.com........................................15...................................501 International Coffee Consulting Group.................(818) 347-1378.............................intlcoffeeconsulting.com..................21 Java Jacket..............................................................(800) 208-4128..........................javajacket.com...................................17, 19 JoeTap......................................................................(855) 456-3827...........................joetap.com.........................................5 Lacas Coffee Company...........................................(800) 220-1133............................lacascoffee.com.................................2....................................723 Mukilteo Coffee Roasters........................................(888) 890-9800.........................mukilteocoffee.com..........................21 Oubu-Jamaican Blue Mountain Coffee..................+45 42794406............................oubu-coffee.com...............................15 Primera Technology Inc..........................................(800) 797-2772...........................primeralabel.com..............................21 Service Ideas Inc.....................................................(800) 328-4493..........................serviceideas.com...............................21................................... 613 Shore Measuring Systems......................................(800) 837-0863..........................moisturetesters.com.........................21 Texpak Inc | Scolari Engineering............................(856) 988-5533..........................scolarieng.com..................................24 The Coffee Trust......................................................(505) 670-9783..........................thecoffeetrust.org.............................21 Tightpac America Inc..............................................(888) 428-4448..........................tightvac.com......................................19 Vessel Drinkware....................................................(855) 833-7735...........................vesseldrinkware.com........................17 Vita-Mix Corporation..............................................(800) 437-4654..........................vitamix.com.......................................9

Calendar

For complete and updated show information visit our online calendar: http://coffeetalk.com/industry-calendar/

November 2-3

81 Cumbre Cafetera Coffee Summit 2017 Cartagena Colombia

November 6-8

NAMA Coffee Tea & Water, Gaylord Texan Resort & Convention Center, Grapevine, Texas, USA

November 9-12

Seoul World Barista Championship, Seoul, South Korea

November 16-18

5th World Tea & Coffee Expo 2017, Mumbai India

November 22-25

1st ASEAN Coffee Industry Development Conference 2018, Chiang Mai Thailand

December 14-16

Dubai International Coffee and Tea Festival, Dubai UAE

January 21-23

Winter Fancy Food Show, San Francisco, CA USA

March 4-6

International Restaurant & Foodservice Show, NY USA

March 7-11

Natural Products Expo West, Anaheim CA USA

March 15-17

NCA Annual Convention, New Orleans, LA USA

March 16-18

Coffee Fest Baltimore, MD USA

March 21-23

NAMA One Show, Las Vegas NV USA

April 18-22

Global Specialty Coffee Expo, Seattle WA USA

May 19-22

National Restaurant Show, Chicago IL USA

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22 November 2017