Coffee is a staple in most people’s lives.
Whether it’s what wakes you up in the morning, or is served to your customers during the day; coffee is an intrinsic part of social culture around the world. In Australia, we are undoubtedly in the midst of a ‘coffee boom’, with independent cafes and coffee roasters riding the wave of unprecedented consumer interest in coffee.
Coffee is definitely the golden child of the moment in hospitality. Your customers love it like never before - they want to know what blend they’re drinking, where it’s from, and why it’s unique.
But a new, far more important facet is now being called into question by consumers and cafe owners alike: who are your coffee farmers, and is their business sustainable?
The word ‘sustainable’ is often misunderstood. Whilst it absolutely pertains to environmental processes and your carbon footprint, it also applies to the human side of a business, too. Are the producers being paid fairly? What are their conditions like? Is there a ‘closed loop’ of communication in the supply chain?
And this is where fair trade coffee comes into the picture.
All of the concerns above are categorised, challenged, and solved by international fair trade organisations such as Oxfam, the World Fair Trade Organisation, and the International Coffee Organisation. Whilst it seems like quite a modern preoccupation, the fair trade movement is actually over 70 years old.
The history of the fair trade movement begun way back in the 1940s, when the United States was negotiating trade of Puerto Rican needlework. The first ever official ‘Fair Trade’ shop - which sold these and other items - opened in 1958 in the USA.
From here, a long and difficult battle begun to seek out ‘fair’ prices for traded items from poor or disadvantaged communities. It is one that continues today. In more recent years, coffee has become the greatest commodity to be focused on by fair trade organisations, with agreements drawn in 2001 and 2007 aimed to stabilise the coffee economy by:
“...promoting coffee consumption, raising the standard of living of growers by providing economic counselling, expanding research to include niche markets and quality relating to geographic area, and conducting studies of sustainability, principles similar to fair trade.”
But the fact remains: coffee is grown in some of our world’s most troubled regions. From Mexico, Colombia, Guatemala, El Salvador, Africa, Indonesia, and India; the third-world conditions that give rise to prolific gang activity, crime, and poor working conditions. So whilst the fair trade coffee movement of the past has endeavoured to improve the relationship between growers, buyers, and consumers - massive structural problems still exist.
Earlier this year, Melbourne-based cafe owner and coffee expert Nolan Hirte spoke at the GROW Assembly, a hospitality-specific education event and showcase. His speech provided profound insight into the struggles of the modern-day coffee grower, and the very simple way we, as business owners and consumers, can help.
The first step, he says, is to expand the current coffee obsession among consumers to include the supplier journey alongside taste and origin. With education will come awareness and appreciation, he says, at which point we can start passing on fair prices to the farmers growing the coffee.
“There are a lot of baristas in Melbourne now, there are a lot of coffee people,” Nolan says.
“But I’d say a lot of them don’t really understand where it comes from. They work with it every day of their life, but they don’t see the true value behind it. It’s not about how to make a latte. It’s about understanding coffee’s nature, how things work, moving with the seasons and appreciating where it came from.”
Fast facts on coffee costs:
- Many of the countries that coffee is grown (like Africa, India, Colombia, Mexico, Guatemala, or El Salvador) are third world communities overrun with criminal activity.
- In El Salvador, coffee is almost extinct due to the mismanaged supply chain and low pay.
Coffee producers in Honduras are so badly underpaid, one of Nolan Hirte’s suppliers only produced half their normal coffee supply last year.
- There is often a ‘middle man’ in the supply chain, who can skim off part of the suppliers fees.
- Even charging an extra 50c on our coffee prices will make a huge difference to what we can pay the struggling suppliers.
Nolan has personally travelled to many of the farms from which Proud Mary’s source their coffee. From Costa Rica to Honduras, he has spent an extensive amount of time with the families of the farmers, speaking with them about the struggle of finding a price that matches the quality of their coffee, but still is achievable for the Australian market.
Nolan gives the example of Maria and Alfredo, a couple who own a coffee farm in El Salvador. Working with them, he visited several years ago only to be shocked by the conditions they were struggling to survive in. Formally a coffee giant, El Salvador dropped to half their normal rate in 2010, producing just 1.9 million bags. In 2016, it was a shocking 450,000.
In a stroke of luck, this year Maria found five ‘special’ coffee trees on her farm. Tasting the coffee - with only 20kgs worth - Nolan was convinced this bean deserved a special price to match, and offered Maria $25/pound, as opposed to the standard $4/pound.
“Her jaw dropped,” he recalls.
“One thing I know is that next year? That’s my coffee. No one else is getting that. And the second thing is, she’s getting value out of that. She’s the one that found it, she’s the one that discovered, she’s the one that’s doing the work. And you guys need to pay for it.”
Like many other cafe owners and coffee lovers in Australia, Nolan talks a lot about ‘integrity’ in the industry. The coffee business has long struggled with issues of unfair and even illegal working environments - hence the introduction of clearly marked ‘fair trade’ brands. But it is now time to take a step further, and push for ‘fair pricing’, too.
Nolan raises an excellent anecdote - 17 years ago, he says, he was charging $3 a coffee. Today? You’re lucky to push it to $4. Consider anything else from 17 years ago - rent, car rego, petrol, a litre of milk - and you will be hard pressed finding anything else that has failed to grow with inflation like coffee.
Most people would be outraged to pay $5 for a cup of coffee, sure. But what if you knew all about it, as you would an expensive cheese or wine. Would you not be compelled to pay for quality?
You only need to look around any of Australia’s urban centres to see that coffee has taken on a new identity. No longer is it simply something to wake you up on a Monday, or get you through a late night of study: coffee is a delicacy in its own right, a beverage to be understood and enjoyed as you would a fine wine. But more so than communicating the aroma, acidity, body, flavour, or origin of your coffee...why not communicate the supply journey and the farmer’s story?
At present, the education behind the bean-to-barista journey is really limited.
Even the most progressive and committed coffee shop owners among you will generally only offer the location and qualities of their chosen bean’s origin - both important aspects to know, but what about the farmer? What about the price?
Fair trade and sustainable judgement of a coffee blend is no longer the interest of a devout barista or socially aware cafe owner, it’s the curiosity of the common customer.
Education is power. Communication is key. Charging $4.50 for a cup of coffee will make no sense to your consumer until you explain why. As Nolan so expertly portrayed at the 2016 GROW Assembly, putting a face and a story behind the beans you are grounding makes this price shift so much more profound.
Interview with Nolan Hirte, Proud Mary Coffee Melbourne.
Nolan, how can current restaurant and café owners continue to educate consumers on coffee prices and production?
It is really important that the restaurant and cafe owners understand or learn as much as possible about where they are buying their products from.
If there is a solid understanding or emotional connection to where the products come from in the first place, then educating the consumer becomes relatively easy.
People can feel when someone believes in what they are saying. Then this real connection with the product will translate to the consumer and they will be happy or more willing to spend.
How do you do this at Proud Mary?
More often than not the consumer really wants to support a real story behind a real product, it's our job to make sure we are telling the truth and letting consumers know what is special about what we do.
Something we have introduced at Proud Mary is a curated coffee menu based around education and perception, we want to create opportunities for the consumer to learn and get excited - and hopefully even blow their minds!
How can owners price their coffee effectively without isolating the customer?
Do not undervalue your products. If you have something special then there is a great opportunity to raise the price and talk about what it with your customers. If the product is truly good, it should be able to back you up and excite your customers too.
Communication and understanding is the key - if all the staff are behind the coffee and the story, it will be much easier for the consumer to get behind it too. I like to try and create options for the consumer, I don't want to force them into spending up.
“Here are three options, all different prices and all complete different coffees based on character and process.”
"Yes, the third option is the most expensive but seriously - it is amazing, and it is worth every cent"
I find that in most cases, the consumer in this situation will want to spoil themselves and get the best, if not there is no shame in it and there is a much more approachable option for them. Creating trust that you can deliver the goods when you say you can is also really important. Words are cheap.
How can coffee shop owners build relationships with farmers directly or source sustainable coffee?
Building relationships with farmers directly takes time and money, and requires really putting yourself out there.
Most cafe owners won’t get the opportunity to travel abroad to their supplier and go to this level of sourcing their coffee. That's totally fine, just make sure you are buying coffee from someone you believe in and trust, that's what really counts.