Purchasing
In the dynamic world of coffee roasting, the quality and consistency of the final product heavily depends on the green coffee beans sourced. However, with the increasing volatility in the coffee market, roasters face greater challenges in securing their supplies. It's more crucial than ever for roasters to take a proactive role in managing their green coffee purchasing to ensure their business's sustainability and growth.
Understanding the Current Market Challenges
The coffee market today is fraught with complexities. Factors such as climate change, political unrest in coffee-producing regions, and significant price fluctuations all contribute to an unpredictable market environment. Furthermore, the availability of spot coffee, particularly in regions like Australia, has diminished, making it harder for roasters to rely on last-minute purchases to meet their needs.
The Risks of Poor Planning
To navigate these challenges, coffee roasters must take decisive steps to control their green coffee purchasing. Failing to do so poses several risks:
Inconsistent Supply: Without a strategic approach to purchasing, roasters may face supply shortages, forcing them to buy lower-quality beans at higher prices or even halt production.
Quality Variability: Inconsistent sourcing can lead to significant variability in bean quality, affecting the taste and reputation of the final product.
Financial Instability: Market volatility can lead to dramatic price swings, impacting profit margins and making financial planning challenging.
What Roasters Need to Do
Develop a Strategic Sourcing Plan: Roasters should move beyond ad-hoc spot purchasing and establish a comprehensive sourcing strategy. This involves forecasting coffee needs based on sales trends and securing agreements with suppliers in advance, helping to mitigate risks of shortages and ensure a consistent supply of high-quality beans.
Diversify Supply Sources: To reduce reliance on a single source or region, roasters should diversify their supply base. Sourcing beans from multiple regions and suppliers spreads risk and offers opportunities to explore new flavour profiles and blends.
Utilize Advanced Tools and Technologies: Modern tools are essential for streamlining purchasing processes and making informed decisions. Tools like Greensquare are invaluable with key features:
Blend Builder: Assists roasters in creating blends that meet desired flavor profiles and budget constraints. It allows for detailed tracking of costs and helps forecast future coffee needs, ensuring roasters can plan ahead and avoid shortages.
Tender Feature: Enables roasters to outline their coffee requirements and share them with multiple importers simultaneously. This feature allows roasters to compare offers and secure the best possible deals, ensuring quality and cost stability.
Position Manager: Allowing roaster to log all contracts with suppliers in one place then seamless drawdown with automatic emails sent directly to your supplier and you inventory updated ensuring you have a live and accurate inventory feed. (launching in August)
Stay Informed and Adaptive: The coffee market is constantly changing, and roasters must stay informed about market trends, pricing, and global events that could impact supply. Being adaptive and ready to adjust sourcing strategies in response to new information is crucial for maintaining a stable business.
Building a Resilient Coffee Business
By taking control of their green coffee purchasing, roasters can better safeguard their businesses against the risks of supply chain disruptions, price volatility, and quality inconsistencies.
This proactive approach secures a steady supply of quality beans, maintains consistent product quality, and strengthens customer loyalty and brand reputation.
In conclusion, as challenges in the coffee market continue to grow, it is imperative for roasters to adopt a strategic and controlled approach to their green coffee purchasing. Investing in advanced tools and developing a robust sourcing strategy are key steps that roasters need to take to ensure long-term success and resilience in a competitive industry.
For all our Aussie coffee roaster you can register today for a free trial of our full suite of tools on greensquare with our Essentials Plan.
Roasters Essentials Plan on greensquare $49p/m
Unlimited Users
No Lock In Contracts
Full Feature Suite
Tenders, Easy communicate your needs with multiple suppliers then track and review all offer in one place.
Blend Builder, Plan, budget and compare your blends and their components then see automatic forecast volumes per component.
Position Manager, Upload all your contracts in one place to be able to place orders then the system takes over and automatically send your supply your order requests updates your inventory and tracks your drawdown.
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