Fair Trade – the absolute minimum necessary to get people to stop questioning how you source, or pushing you to do better. Not enough.

The advert that had sparked it off was one I had seen on the underground, and it was the language more than anything that frustrated me:

So there you have it.  A moment of joy!  As if they had reached some pinnacle of sourcing, some great achievement instead of doing the absolute minimum to satisfy the public’s questions about the ethical nature of their sourcing.  No transparency, no open traceability, but don’t worry – we’ve got a logo so don’t worry about a thing.  This BBC article explains the move to Fair Trade that Cadburys made, though the second half could make you cynical about their motivation.

This post was sparked by a short conversation today.  I had popped down to Gwilym’s cart on Columbia Road, because the splendid Jenni Bryant (who many of you will know from Gimme!) was down there working and I wanted to work a little too.  A customer started asking about the WBC – Gwilym has a competition branded Aurelia there – and it turned out to be Nick Francis, one of the two guys behind the film “Black Gold“. We had a little chat about the film, about what I thought of it, about its relevance to the specialty coffee industry, about their goals behind the film.  Interestingly many people criticized him for not being sufficiently pro-Fair Trade in their eyes, while the specialty end no doubt felt like Fair Trade got too much good press and not enough was said about traceability, direct trades, relationship coffees and paying a sustainable premium price based on quality.

As we talked about Fair Trade he opened his newspaper to a full page advert from Starbucks, which many in the UK will have seen recently, proclaiming how proud they are that all their espresso drinks are Fair Trade. I think we shared a frustration here.  No doubt it is better for Starbucks to pay FT prices, if they are more than they were paying before.  However – a purchaser of coffee that large has an opportunity to go over and above Fair Trade.  A few of the mills I visited in my origin trips had sold to Starbucks, most under the a premium program.  ((I thought it was called the Star Program, but I can’t find any evidence of it online – can anyone enlighten me?))  Herbazu, the farm in Costa Rica whose coffee I used in the WBC finals, used to sell to Starbucks for a premium price – money that helped them build a micro mill, vertically integrate and continue to increase their quality.  The only complaints I heard were that Starbucks demanded open books, to see where every single penny of the premium went – and thus it was annoyingly bureaucratic.  Beyond that Starbucks was considered a great buyer.

I have no doubt that only a relatively small percentage of Starbucks coffee was sourced at a premium like this.  (Update:  I have been corrected on this – see end of post.) However, that is unlikely to change without pressure on them from their customers.  Switching to Fair Trade, and the lack of public understanding about what Fair Trade really means and guarantees, will no doubt alleviate the pressure on them to be ‘sufficiently’ ethical.  I just don’t see ethics as being something you can do by half.  That said – what surprises me is that after the harassment that Starbucks have taken from Costa recently, that they don’t turn the tables and start focusing on Costa’s ethical sourcing.  (Costa commits to sourcing only 30% of its espresso blend through the Rainforest Alliance certification, and says nothing about how it sources the rest.)  Nero dodge the issue on their website – though knowing what they were paying for their espresso blend a couple of years ago, I would have issue with some of their statements.  They’ve recently bought a roastery, and it will be interesting to see if taking their roasting in house results in a change to their buying practices.

I can’t help but feel that Fair Trade’s greatest deception, its most frustrating piece of consumer misinformation (purposeful or not), is that Fair Trade is the ultimate goal – not a starting point.  I’d have nothing against them pitting themselves as the absolute minimum expected of any company but I find it worrying to see it spun into being almost the exact opposite.  I don’t think there is any benefit to bashing Fair Trade, I don’t want to be one of those people, but we do need to agitate the industry – to start talking in very simple terms about how far we go and how much further we can go, as long as we take the public with us.

UPDATE: Thanks to Cindy for the figures and to Yara for telling me the name of Starbucks purchasing program is C.A.F.E. practices.  From Cindy’s comment:

” Actually, in FY2008, Starbucks purchased 77% of its coffee under C.A.F.E. Practices with the goal for reach 100% by 2015″

This is both good news and incredibly disappointing.  Good news that Starbucks buys so much of its coffee so well (in my opinion based on what I have seen at origin, and my limited conversations there).  Disappointing because I would see a move to Fair Trade as largely being a step backwards.  Why not shout about C.A.F.E. Practices?  Why not tell the world what you pay for coffee?  Why not use Fair Trade as a reference point, and then talk more about what you do?  This somehow seems like a caving in to public pressure, and not in a good way.  Again – I’d like to understand this better, thoughts and comments are very welcome.

For me this talk was a moment of crystalisation about how I feel about coffee right now, and what I want to focus a lot of my energy on.  I had initially planned to talk about how quality focused businesses were doing well right now, but in the process of writing the talk that seemed to shift.  I should add a final caveat to this by saying that I do love making and drinking espresso.

My talk was titled “How the coffee industry lost the public’s trust, and how good coffee can win it back again.”

My feelings about espresso changed dramatically around the time I first experienced coffee in Italy.  A few things struck me initially – the coffee was prepared reasonably well, it wasn’t astonishing or delicious and it was cheap.  I would later learn that the price of espresso to be consumed at the bar is regulated and never more than €1.  When I first made espresso for Italians I was initially confused by the fact that they never asked for espresso, they just asked for coffee.  Non-specific, without customisation – just coffee.

Like many people I had held a fairly romantic notion of espresso in Italy.  This was swept away and replaced by disappointment.  This has since given way to respect.  I think what changed my mind was a little perspective, and a better understanding of espresso’s history. ¹

This poster is probably familiar to everyone in coffee.  For me it summarizes pre-1948 espresso.  The innovation that espresso offered at this point was speed.  Suddenly a cup of coffee could be brewed very quickly.  So quickly, in fact, that you could grab a cup whilst hanging out of the side of a moving train.  The cups of coffee are full to the brim, and have not even the vaguest whisp of crema upon them.  This was nothing like espresso as we know it.  This was like having a big tank of water with which to make multiple moka pots.

Then of course we have post WWII espresso, we have Achille Gaggia’s espresso machine and we have the first mentions of crema.  Again – at this stage espresso didn’t suddenly become perfect little 25ml shots, full of thick dense crema.  The real revelation for me about this period was an almost throwaway sentence in one of Kenneth Davids books on coffee.  Post WWII Italy was not an economically strong place.  It is unlikely that the coffees bought during this time, during the birth of espresso’s tradition as we know it, were anything other than cheap and readily available.  It is no great surprise that naturally processed coffees from Brazil and robusta became the bedrock of the traditional espresso blend but we’d do well not to assume they were chosen because they tasted the best.  Espresso is pretty good way to brew these coffees.

The point that I am slowly working towards is that for all the romance, history and tradition, espresso is not special.  It is not luxury.  It is not gourmet.  It is just a way to brew a small, strong cup of coffee.

That of course changed, and in no small part thanks to Howard Schulz.  It is worth noting that in any description of his epiphany moment in Italy, where he saw a barista craft both an espresso and a cappuccino in a convivial and charming manner, does he describe being blown away by the coffee.  It was the experience that stuck with him, and the experience he thought he could sell. ²

He was, of course, quite right.  He could sell the experience, he could package it up and replicate it almost exactly across the world.  I have no idea how many different stores they have worldwide, but with 700 in the UK it is hard to argue with him.  However we did something else as part of this process.  We made espresso expensive.

Let’s say a single espresso in London costs £1.50, which is a little high but not by any means unusual.  Assuming it is a 25ml shot that works out at 6p/ml.

If you were to go to a pub and buy a pint of espresso it would cost you £34.08.  Or you bought a wine bottle of espresso it would cost £45.  That is a phenomenal amount of money.  Think about the drinks you can buy for that sort of price.  They are either extremely delicious or extremely alcoholic.

The problem is that a price tag like this is a pretty hefty promise.  Selling an espresso for this much implies that the experience will be of equal value.  Sip for sip it should be as satisfying as a great champagne.  The problem is that in this country, in London, in the vast majority of businesses – it isn’t.

Charging this much and delivering something so awful as the average high street espresso destroys any trust between the coffee industry and the general public.  This kind of price/experience discrepancy makes people feel stupid.  It makes them resentful.  It turns them into the kind of people that get very angry and leave vicious and dismissive comments at the bottom of news stories about speciality coffee posted online.  We’ve all seen those comments online, globally I might add, that follow a news story about speciality coffee.  Angry, bitter comments about what a waste of time and money this ‘fancy’ coffee is, that it is nothing more than the emperor’s new clothes and that coffee is just coffee.  These opinions come from specific experiences, we – the coffee industry – have created some very angry consumers.

As soon as the economy started to dip there were a glut of articles on ways to live more frugally, how to strip unnecessary spending from your day to day habits.  In every single list was coffee.  By and large lattes on the high street are overpriced, they are worth cutting out of the budget.  The frustration is that they don’t have to be. ³  I wouldn’t advise dropping the coffee from your routine, I would advise finding a place that makes one that is worth the money.

Yet still the industry persists in telling us that espresso is better.  At the Allegra talk I listened to to Rebecca Hemsley, the head of coffee for Pret A Manger, talk about how they offer (for the price conscious) a cup of filter coffee for 99p.  She added that they weren’t cutting corners – they used the same blend as they do for their espresso.  I should add that a single espresso at Pret is £1.25.  What message does that send to the consumer?  How does that affect their expectations of both the espresso and the filter coffee?

So I’ve written quite a lot already about espresso, and haven’t really gotten onto the subject of brewed coffee.  At this point in the talk I began brewing a small press of coffee.  I wanted to talk about where I thought coffee could go.  In the first talk of the day Darcy Willson-Rymer, the MD of Starbucks UK, had described value as being a combination of price, product and value.  I quite liked this, and say what you like about Starbucks but they’ve cleared managed to price their experience right for it to be the success it is. ⁴

I chose a coffee to brew that had very distinct and interesting characteristics.  I talked about where the coffee was from, and how it had gotten to the UK.  I described the coffee as having strong notes of blackcurrant, cherry and blueberry.  For me this makes an obvious promise, whereas a price makes a slightly less direct one.  A promise like this is a fairly big one but they pay off is also potentially huge.  We all have a salesman in our life that we completely trust.  They might not be an obvious salesman – they could be a bartender, a waiter, a sommelier or someone who sells stationary.  We trust their judgement, and we are loyal to them.  That trust was gained through making promises and keeping them.  Making a promise like this with a cup of coffee was what pushed us to work with Marco on the Uber Boiler but that is a slightly different topic.

As the coffee finished brewing I explained how much I’d like to sell it for a cup:  £3.  This wasn’t because it was vac-packed, or because it was airfreighted, or because it came in a nice bag with a nice logo.  If you like coffee, then I think that that combination of price, product and experience is good value for money.  Buying and drinking this cup of coffee is worth every penny.  I offered that one 8oz press to the audience for sale, and I am very grateful (and was somewhat relieved at the time) to both Darcy and Louie Salvone for paying £5 each (to charity) to split the press between them.

Brewed coffee is capable of such flexibility, such a range of experiences – from the satisfying, to the interesting, to the exciting, to the downright weird – that I think it is the most overlooked and underestimated weapon in the arsenal of those of us trying to build consumption of great coffee.  I am not saying it is better than espresso, but I do think a great cup of brewed coffee is less elusive than a great espresso.

Most operators believe espresso is somehow better than brewed coffee, and that brewed coffee is a second class experience that is suitable only for bulk brewing the nasty, weak coffee they serve at events where people aren’t paying for coffee.  Restauranteurs insist on having espresso machines even though the flow of a restaurant and its layout make serving great espresso virtually impossible even if the brewing is impeccable.

So I should wrap this up by saying that in the next year or two the proliferation of great brewed coffee, ideally by the cup, is a big goal for me – both personally and professionally.  If you are reading this and you can help then I really hope you do because I think everybody, from grower to consumer, wins.

1. Though I should say that my espresso history is far from authoratative!
2. Can I just take a moment to have a quick rant about the constant use of the word ‘theatre’ around espresso.  Theatre is entertaining, but there are only so many performances of the same thing that I am prepared to sit through and pay for.  If you have bought a commercial espresso machine mainly because of the theatre then your business may be in for some difficult months ahead.
3. That said, a large part of me is enjoying a market with more value focused, quality conscious spenders.
4. I am aware that is a childish and snarky dig at their product, but the whole point of this post is about serving great coffee which I don’t think they do.

Nonetheless it has been interesting to see what they industry press are writing about, what advice is being offered, what strategies are being deemed wise.  A word I am seeing more and more is ‘diversifying’.

Starbucks are in a mess right now, and they have been for some time.  To me the problems are linked to a gradual loss of identity over the last few years.  Right now they are putting out mixed messages – on one hand promoting better coffee, on the other hand discounting it. Worrying about breakfast sandwiches, selling CDs, whilst still trying to claim that they are all about the coffee.

Photo by tonx

For a while, in the UK anyway, McDonald’s were all about salads.  Big money on big advertising campaigns telling us what a good idea it was to buy a salad at McDonald’s.  It didn’t work, that isn’t why we go to that place and walking past a branch on my way home I didn’t see a single salad image on display and I have no idea if they even still serve them.  The saw salad’s as a way to help stop declining sales, instead of actually making the food they had served very successfully taste, and be, better.

We’ve all visited businesses that have scrambled for turnover through diversification – coffees, teas, smoothies, soft drinks, pastries, panani are only the beginning.  Every item added seems to drag the average care and attention for each item down a little.  Nowhere does a huge range of things exceptionally well.  In the end, desperate to catch all consumer demands the business looses all identity.

Imagine I showed you a menu for two different Chinese¹ restaurants.  The first has a typically huge menu of maybe 50 or 60 dishes.  The second menu has a total of 15.  Would you expect a difference in quality between the two?  Would the smaller menu imply a lack of imagination or greater care and attention to each dish?  If each restaurant does two dishes incredibly well – in which menu do you have a better chance of a great experience?

Starbucks do the desert in a cup very well.  They brand it well, they sell it well and if you have a sugar craving then it probably tastes pretty good.  The gingerbread latte has become weirdly iconic, and endlessly imitated.  Those drinks built the Starbucks expansion, and for many consumers they justified the premium price. ²

Starbucks have done a poor job of redeclaring their own identity and it continues to hurt them.  Businesses are looking at a bleak year ahead and I think having a strong identity is key.  You need customers loyal to your business, customers that have a connection with what you do, with the positive experience they associate with you.  Diversity may be a way to sneak up the average customer spend, and I am not saying it can’t be done well, but often it reeks of desperation or overreaction to a natural dip in sales (such as in January…).  Coffee is still a long way from being written out of people’s budgets – as long it is worth the price per cup.

Dropping coffee sales say more about what people think your cup is worth to them than it does about your customers think about the size of your range of products.

1. Or any cuisine with a typically very large menu
2. I justify that simply by the numbers they sold!

I hope you don’t mind if I use two theoretical espresso establishments.  One sells a shot of espresso for 60p, they carry no obvious branding as to which coffee they are brewing.  The second place sells its espresso for £1.80, three times the price.

What is interesting about this is that the 60p shot is probably less appealing than the £1.80, but you wouldn’t necessarily expect the £1.80 shot to be amazing or three times better.  In a world where most espresso is no good, the chance of finding a great one at that price (60p) seem absurd. ¹We still make judgments on coffee’s quality based on its price but we’ve learned to limit our expectations when the price goes up.  There is, however, a threshold limit to that expectation.

Imagine now a place with a £4 single espresso.  As you receive the drink you probably say out loud “This better be good.”  Quite rightly – it had better be good, because this business has made an implied promise of how good your experience will be.

Those of us in the industry are always frustrated when coffee news on blogs and news websites receive hundreds of surprisingly angry people deriding the very idea of quality coffee, angrily denouncing coffee “snobs” or mocking those businesses trying to do better.

No, what will happen is that these people will go to the training sessions and forget them very soon after. Why? They work in coffee shops and it really doesn’t matter. It’s just coffee.

I think the coffee industry has to accept that we created these people, their anger and bitterness a result of our actions.

These people have probably tried to buy a better cup in the past, and in trying to do so have probably bought a more expensive cup.  It might be that that experience was in a Starbucks, or perhaps in an independent.  Either way they were so disappointed that they still feel the need to vent that anger on message boards.

Coming back to setting prices, and what we communicate with them.  If you own a cafe then look at your prices – what do they say about your coffee?  What did you base those prices on?  Was it on the chains you compete against or was it based on the prices listed in a business whose quality you want to emulate?

At this point I want to clarify that I am not suggesting pricing coffee in such a way that it develops the tag of exclusivity any further than it already has.  I hate seeing coffee as something exclusive – I want coffee to be inclusive.  We need to drive consumption, as higher consumption of better coffee is pretty much a win/win for everyone in the chain – from consumer back to producer.

That said I do want to wrap this post up by saying that I think we often fail to communicate properly through our pricing.  One of the last things we think about is: “What is this cup of coffee worth?”

1. It is worth noting that a few places in London that do great espresso do it very cheaply – I am not saying cheap and delicious espresso is impossible