 |
|
|
|
BROWSE THE
SITE:
|
There's a Whole Lotta Changes Goin' On Out There© 2004 Stuart Daw The struggle in the out-of-home coffee business has always been between three basic heavyweights, QUALITY, CONVENIENCE, and PRICE. Every new innovation or trend is an attempt to improve on one, two, or all three of them. The myriad other variables are subordinate to those three. But the big question still remains: what shall I sell and what should I charge? Here are a few alternatives that bedevil today’s decision makers: single cup vs. batch brew; fresh ("real") coffee vs. soluble; variety of coffees made available at the point of serving; time needed for preparation; private label vs. national brands; leasing vs. loaning equipment to customers; capital and maintenance cost of equipment along with the obsolescence factor; variability of needs due to demographics within a location, to name just a few. We only have space here for a very brief comment on some of these SINGLE CUP vs. BATCH BREW: Which makes the better cup of coffee? "It all depends." What is the basic quality of the coffee in the bag, the hopper or the cartridge? How fresh is it? What is the coffee-to-water ratio? What is the time of extraction, given the grind of coffee in use? What is the infusion temperature during the brewing process? Is the coffee going straight into the cup, or is it first held in a thermal server or glass bowl where it may sit for a time? Cup by cup (let’s use that name for single cup, brewed from a hopper of bulk coffee), with an adjustable measured amount of ground coffee, gives flexibility not available in a cartridge system, where an illusion of better strength can only come through elongating infusion time. But there is generally less variety of choices in cup by cup, perhaps limited to two coffees and two other hot drinks. In cartridges, packaging costs can outweigh the cost of the coffee itself. But some cartridge coffees cost more than others. For example, Flavia costs more than Kuerig, and while the markup per cup we see today may be similar with these two, GP as a percentage of sales would be lower in the Flavia mode. While all cartridge coffee is much more expensive than cup by cup, and even though the GP per cup is also higher, the lower cost to the end user in cup by cup should mean higher consumption. And to the customer, cost may of course be the determining factor. But so far in this competition, maintenance and service calls remain a larger problem with cup by cup. Cartridges are a shade more "fiddly" than cup by cup, where one simply bellies up to a machine and pushes a button. Indeed, a cartridge setup in a classy lawyer’s foyer almost reminds one psychologically of high tea time in a ritzy English hotel, with formally dressed ladies swishing around trying to make you feel at ease. A second cousin to the cartridge is the pod concept, similar to that employed in some espresso coffee machines. A variety of equipment to handle pods will soon hit the market in a big way. The over-wrapped pods will be a bit more finicky than the self-contained cartridge for the end user. But for operators it will address the problem of tight control, the attempted monopoly over product now exercised by the equipment manufacturers and their franchisees. And they will be less costly. The result: price competition will rear its ugly head when normal roasters and OCS operators hit the ground running with a variety of pod-accepting machines. As a sub-issue in cup by cup, there is the choice between machines employing filter papers and those using screens. Paper filters produce a clearer cup of coffee than do screens, but not necessarily a better one. The micro-fine particles of coffee getting through a screen will allow brew colloids to collect around them, creating a nice mouth feel, a sense of body, a tactile sensation on the tongue. The coffee may appear stronger, while the filter paper will make the coffee appear weaker and less cloudy… "cleaner." FRESH COFFEE vs. SOLUBLE: Nowhere are the questions of quality, price and convenience more in conflict than in this area. One good example of the schizophrenia involved is the national chain of hamburger drive-ins that has a large percentage of its stores on a liquid concentrate and the rest still purveying fresh coffee, while their chief competitor is trying to create a kind of Starbuckian image of selling specialty coffee. What strikes me as an indication of the collective guilty conscience at the headquarters of the former company is the signage a customer sees when he or she enters a store that uses instant liquid concentrate. On the wall near the coffee machine is a big, blatant pitch designed to convince the customer that the coffee is beautiful. The sight of this banner should make the customer suspicious. The jury must be still out for this firm, awaiting data that convinces management to go one way or the other. And now we have a plethora of freeze dry machines being pitched to the coffee service industry. Convenience vs. quality again. But don’t make the mistake of assuming soluble coffee will never be a serious threat to the real thing. As an illustration of how I feel about solubles and quality, I recall a question a reporter asked Seinfeld after the very long and successful run of the Jerry Seinfeld show. "Jerry, what was the show really all about?" To which Jerry answered after a moment’s consideration, "Nothing." That’s how I feel about soluble coffee -- it’s nothing. In its best form it has a faint suggestion that it is a cup of real coffee. It is fit for human consumption and not very objectionable, but neither does it have any claim to what we regard as a "real" cup of coffee. But its very neutrality means that much of the public that doesn’t really care for coffee will not be offended by it, and indeed may accept it as their cup of choice. So if you confidently walk down any street in America with two thermoses doing a consumer preference survey, with one thermos containing high grade fresh coffee and one containing fairly weak instant, brace yourself for potential disappointment. The majority of people you persuade to try both coffees blind may very well say they prefer the instant, especially if it is loaded with cream and/or sugar. And liquid instant is and has been for some time wildly successful in large venues such as stadiums and banquet halls, where the argument from convenience and lack of waste easily overpowers any case for a quality beverage for the cost conscious caterer. FLAVORS AND OTHER VARIATIONS: Added to the wide choice of flavors we now have to contend with are all sorts of strange names and things having no necessary connection to quality: Organic, Fair Trade, Bird Friendly, Song Bird, Triple Seal, Shade Grown, Transfair, FLO (sounds like PLO, but really stands for Fair Trade Labeling Organization), Global Exchange, Equiterra, Alternate Trade, Max Havelaar (that’s a Dutch variation of fair trade) are but a few. No room here for a philosophic evaluation of this trend, but if it were a contest, perhaps the prize might go to the wackiest one I have encountered lately. A customer’s customer requested coffee picked from the top one third of the coffee trees. No name given yet to that category as far as I know. TIME AND THE COST FACTOR: I have yet to see a definitive (as opposed to a self-serving) survey establishing the average time required to satisfy a company’s need to provide cups of coffee for each employee. What would be the relative man-hours spent on each of the alternative ways of providing it? Of course the internal demographics of any company may suggest the best course, such as batch brew for the lunchroom and cartridge for the executive suite. To the consumer, the cost of a cup of cartridge coffee is roughly the same as the cost of a whole pot of batch brew. But to brew a whole pot, drinking one cup and throwing the rest down the sink is not a very good answer, though for serving ten people at once a full pot is a fast one. Still we can’t ignore all the reasons why the alternate, the single cup way, might be better in spite of its hugely higher cost in variety, brew freshness, etc. As one
can see, the possibilities, the choices, are infinite. To repeat a favorite saying of
|
|
Copyright © 2000-2006 |
