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Question for the professional operators

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  • Question for the professional operators

    One of the most common questions in the negotiation of coffee supplies for commercial outlets is the issue of who pays for & owns the coffee equipment.

    Coffee Roaster:  Is always asked to supply $5,6, 7,000 of equipment and POS for each new outlet that wants to use their coffee.  Makes a large impost on capital requirements.

    Coffee Shop/Outlet: Is asked by roaster to make a volume commitment to justify the equipment.  If they dont make it they get charged anyway.

    This equipment is often described as "free-on-loan" but the cost is often just buried in the price.

    There are of course advantages:

    Coffee Roaster: Has a greater interest in the end business and more say in the quality of the finished product.

    Coffee Shop/Outlet:  Has more access to training and promotional resources with the extra commitment.  Maintenance costs of equipment covered by Roaster.  Less capital costs for starting up.

    My limited understanding of how these deals work needs to be expanded as often neither party end up being completely happy.  So far we have always resisted providing free-on-loan to coffee shops/cafes but I see that it is quite a part of the business.

    Has anyone got any feedback on systems which have worked really well for each party?