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  • Advice sought regarding coffee roasting industry in WA

    Hi all, I am going to be making a transition from my current career (health care) into the coffee industry. After being a dedicated "home barista" for a couple of years I am currently going through formal training programs in advanced espresso making, latte art and roasting. I am fully aware that I do not yet possess the skills or experience to open/run a hole-in-the-wall café or small coffee shop, but I have plenty of passion and enthusiasm to help me on my journey. Instead, I've been looking into the option of learning how to roast beans to start selling online... Then I started doing a little research and there seems to be an abundance of coffee roasters and online suppliers of beans already in Perth.... For you guys who know the coffee industry perhaps better than I do - is there any room for another company selling freshly roasted beans online?? Or is the market saturated?? Sorry for the long paragraph my return button doesn't work for some reason :-)
    Last edited by 13bob; 8 July 2014, 04:00 PM.

  • #2
    Originally posted by 13bob View Post
    I am currently going through formal training programs in advanced espresso making, latte art and roasting.
    I'm more than a little curious... who is providing these training programs?

    Comment


    • #3
      The internet has an infinite feel to it..... the interwebs go on and on and on..........and on!!

      So, yes, there is plenty of room..........

      But. Would you do any good?

      A resounding no!!

      If you want to have an online presence then you will need to establish a reputation for your product.

      This can only be done in the real, physical, world by establishing a network of clients both commercial and private. the only other way

      to have a successful online roasting business is to establish yourself as a well known coffee guru with a thriving coffee machine/grinder business,

      or start up a forum and get 30,000 members.

      At best, online shops are only an addition to your face to face business, only gaining momentum as your brand becomes recognised 'in the street'.

      Beware of the false confidence that a 'course'; advanced or not, might give. (+1 to Vinitasse's query)

      Nothing beats many hours and many more kilos of beans in learning the finer points of consistent roast quality.

      Not only do you need to learn the 'how to do it' you also need to learn the ' how do I fix my mistake? '.

      Comment


      • #4
        Agreed on the above comments.

        Be mindful that a how to use a roaster course will teach you just that.

        In time, you will develop you own style and then (with a little luck), you may carve yourself a niche.

        Be mindful also that the majority of startup businesses fail- more often than not due to poor planning and/or poor business skills.

        Whilst coffee related enterprises may appear to be a license to print money, that exists only at the mint!

        Good luck. Do your homework and then do a whole lot more homework.

        Comment


        • #5
          Originally posted by Vinitasse View Post
          I'm more than a little curious... who is providing these training programs?
          I'm doing most of the courses available through the WA branch of Toby's Estate. They have training at all levels for espresso making and also a roasting course.

          Comment


          • #6
            Originally posted by chokkidog View Post
            The internet has an infinite feel to it..... the interwebs go on and on and on..........and on!!

            So, yes, there is plenty of room..........

            But. Would you do any good?

            A resounding no!!

            If you want to have an online presence then you will need to establish a reputation for your product.

            This can only be done in the real, physical, world by establishing a network of clients both commercial and private. the only other way

            to have a successful online roasting business is to establish yourself as a well known coffee guru with a thriving coffee machine/grinder business,

            or start up a forum and get 30,000 members.

            At best, online shops are only an addition to your face to face business, only gaining momentum as your brand becomes recognised 'in the street'.

            Beware of the false confidence that a 'course'; advanced or not, might give. (+1 to Vinitasse's query)

            Nothing beats many hours and many more kilos of beans in learning the finer points of consistent roast quality.

            Not only do you need to learn the 'how to do it' you also need to learn the ' how do I fix my mistake? '.
            Thanks for the advice. I would have thought that just a good website and some effective marketing would attract public customers? Guess I was wrong with that assumption.... I don't have any real networks within the café industry yet, so I was going to target the public mainly.

            Comment


            • #7
              Originally posted by Talk_Coffee View Post
              Agreed on the above comments.
              Be mindful also that the majority of startup businesses fail- more often than not due to poor planning and/or poor business skills.

              Whilst coffee related enterprises may appear to be a license to print money, that exists only at the mint!

              Good luck. Do your homework and then do a whole lot more homework.
              Thanks for the response. Well, I'm not naïve enough to think I would have a licence to print money just thought I could slowly create an income through online sales. With a relatively low set up cost and overheads, and the fairly good planning and business skills that I have I thought it may be possible. But it's the hugely competitive market that I'm worried about.

              Comment


              • #8
                Originally posted by 13bob View Post
                Thanks for the response. Well, I'm not naïve enough to think I would have a licence to print money just thought I could slowly create an income through online sales. With a relatively low set up cost and overheads, and the fairly good planning and business skills that I have I thought it may be possible. But it's the hugely competitive market that I'm worried about.

                Hi 13bob

                Living as I do in Perth, I would agree it would be difficult to set up a business here at present. Competitive? My local Shopping Centre (Rocky City) has at least 10 cafes, ranging from godawful to barely OK (hold breathe when walking past some of them), however they are (apparently) surviving.

                The real "hole in the market" here (if it is really a market?) is the "boutique roasting on site and serving it on the spot as a cafe". I only know of three in "Greater Perth". Two of those are probably less than three years old, whilst the third dates back to '75 or so. Whatever their turnover is: unknown. However, AFAIK only one of the three offers more than one of their coffees over the counter (excluding decaf).

                IF I was crazy enough to get into it again, I would pick a busy regional hub (i.e. lots of office workers going past, without CBD rents), offer half a dozen different roasts over the counter and try to form a regular clientele base in a hurry. Would it work? 50/50, but then I am probably an optimist.

                Good luck if you decide to proceed.


                TampIt

                Comment


                • #9
                  Originally posted by 13bob View Post
                  thought I could slowly create an income through online sales. With a relatively low set up cost and overheads, and the fairly good planning and business skills that I have I thought it may be possible.
                  I was wondering if you have done your sums as to how much roasted coffee beans you would need to sell in order to make a reasonable income? "With a relatively low set up cost and overheads", indicate to me you are possibly considering doing your roasting from home. Quality commercial roasters, even small ones are not exactly cheap. If you live in the suburbs, I doubt you would get away with a larger (5Kg+), roaster without neighbour or council problems. While the online side of things may be cheaper than having a shopfront, the rest will not be cheap. Tampit's suggestion of combining the roasting with a coffee making outlet is possibly more viable with the extra $s from the value-add of making coffees, and the attraction of a store-front roaster.

                  I presume you already have the necessary roasting skills to produce a quality product hence your interest. If not then unless you buy-in the skills, you have another possible apprenticeship to consider. From my experience it's one of those skills that requires a good deal of hands-on failures and successes before you will be able to match quality competitors. And there will also be a big learning curve from a domestic to a commercial style roaster.

                  Do an online search to suss out just how many people offer roasted coffee online, and the prices. I suggest you will struggle to match the prices of the larger suppliers and still make a profit. They are often able to source their green coffee directly from growers or in bulk at much lower prices than a small enterprise.

                  If your good planning skills mean that you have prepared a business plan, and you have worked out a point of difference to the competition, then give it a go. Many of the current successful providers started out small no doubt, and business acumen is probably as important as roasting/coffee making skills.


                  GrahamK

                  Comment


                  • #10
                    Originally posted by TampIt View Post
                    The real "hole in the market" here (if it is really a market?) is the "boutique roasting on site and serving it on the spot as a cafe". I only know of three in "Greater Perth". Two of those are probably less than three years old, whilst the third dates back to '75 or so. Whatever their turnover is: unknown. However, AFAIK only one of the three offers more than one of their coffees over the counter (excluding decaf).
                    I'd love to see more, but I can think of 6:
                    - Ristretto Coffee Specialists
                    - Elixir (may roast off site)
                    - The Roastery
                    - Typica
                    - Gordon St Garage
                    - Antz Inya Pantz (roastery is over the road from the cafe)

                    Might not all qualify as boutique (depending on your definition). At least 3 sell multiple SOs or blends over the counter. Quite a lot of capital invested there though!

                    There is also Yahava...

                    These cafes are very popular, but are unfortunately clustered mostly around the CBD.

                    South of the river is lagging behind north of the river IMHO.

                    Emergency weekend supply of good coffee south of Perth does not seem to exist.

                    Comment


                    • #11
                      Originally posted by TampIt View Post
                      Hi 13bob

                      Living as I do in Perth, I would agree it would be difficult to set up a business here at present. Competitive? My local Shopping Centre (Rocky City) has at least 10 cafes, ranging from godawful to barely OK (hold breathe when walking past some of them), however they are (apparently) surviving.

                      The real "hole in the market" here (if it is really a market?) is the "boutique roasting on site and serving it on the spot as a cafe". I only know of three in "Greater Perth". Two of those are probably less than three years old, whilst the third dates back to '75 or so. Whatever their turnover is: unknown. However, AFAIK only one of the three offers more than one of their coffees over the counter (excluding decaf).

                      IF I was crazy enough to get into it again, I would pick a busy regional hub (i.e. lots of office workers going past, without CBD rents), offer half a dozen different roasts over the counter and try to form a regular clientele base in a hurry. Would it work? 50/50, but then I am probably an optimist.

                      Good luck if you decide to proceed.


                      TampIt
                      Hey TampIt, nice to hear from you. Yes I agree, it would be very difficult to set up a business here at present. Just in North Perth alone there are 3 or even 4 new cafes just opened up along Fitzgerald st all within a stones throw of each other. The CBD is FULL of coffee shops... and shopping centre cafes are also multiplying (as you have pointed out) so much so that Gloria Jeans in the Morley Galleria is currently for sale at a very low $50K and the very big Jamaica Blue is also up for sale.

                      Comment


                      • #12
                        Originally posted by GrahamK View Post
                        I was wondering if you have done your sums as to how much roasted coffee beans you would need to sell in order to make a reasonable income? "With a relatively low set up cost and overheads", indicate to me you are possibly considering doing your roasting from home. Quality commercial roasters, even small ones are not exactly cheap. If you live in the suburbs, I doubt you would get away with a larger (5Kg+), roaster without neighbour or council problems. While the online side of things may be cheaper than having a shopfront, the rest will not be cheap. Tampit's suggestion of combining the roasting with a coffee making outlet is possibly more viable with the extra $s from the value-add of making coffees, and the attraction of a store-front roaster.

                        I presume you already have the necessary roasting skills to produce a quality product hence your interest. If not then unless you buy-in the skills, you have another possible apprenticeship to consider. From my experience it's one of those skills that requires a good deal of hands-on failures and successes before you will be able to match quality competitors. And there will also be a big learning curve from a domestic to a commercial style roaster.

                        Do an online search to suss out just how many people offer roasted coffee online, and the prices. I suggest you will struggle to match the prices of the larger suppliers and still make a profit. They are often able to source their green coffee directly from growers or in bulk at much lower prices than a small enterprise.

                        If your good planning skills mean that you have prepared a business plan, and you have worked out a point of difference to the competition, then give it a go. Many of the current successful providers started out small no doubt, and business acumen is probably as important as roasting/coffee making skills.


                        GrahamK
                        Hi GrahamK, thanks for the response. I can't argue with any of the points you make. I have not yet prepared a business plan, I am just in the "doing some research" phase. From what I can gather, learning and perfecting the art of roasting does not happen overnight and it appears to be a very competitive market. I don't have the capital to open a storefront (café with onsite roaster) so that is not an option either.

                        Comment


                        • #13
                          Hi 13bob,

                          Some good advice also some less than good advice......... but that's the internet.

                          As you're in the planning stage take Graham's wisdom onboard, having a handle on your costs will reveal your margin and therefore

                          your business's ability to become self supporting.

                          You are going into competition so look to give yourself an edge. At first this won't be in terms of an enviable reputation for awesome roasts

                          but will come in the form of things like low overheads, the ability to sell yourself and clever sourcing of good bean stock.

                          Don't take the advice of lining up a swag of SO's or half a dozen different roasts like you're a hotshot roaster with a loyal following several ranks deep....

                          you will fall in a heap quick smart by having too much cash tied up in bean stock and too much unsold roast going into the garden.

                          A couple of good blends out of a stock of maybe 4-6 different beans, 1/2 of which can do the honours as an SO, but only two at a time and not straight away.....

                          work your way into it. .......you will actually find that the market, as a whole entity, is quite uneducated.

                          A couple of good blends that you can produce consistently for 3-6 months without changing will win you more fans

                          than an arsenal of exotic sounding coffees. After all, most people are actually from ' Shropshire ' ;-)



                          Get to know your market, ..........roast to your market.

                          Find a couple of farmer's/ food markets where there is no dry coffee being sold, see if you can get a stall. Stay away from markets

                          that have too much crafty stuff or are awash with 'trash and treasure'. These markets attract a lot of browsers who will head down

                          the street afterwards and spend their money on coffee elsewhere.


                          People come to food markets to stock their pantries.

                          Get some return customers. That will give you confidence, then build on that.

                          But learn to roast first. If you're going to make a living you'll need to be banging out at least 100 kgs/week..... if you have

                          no business debt, no business credit card, own all your roasting gear, have no kids at home, own one car and a small mortgage.

                          And do everything by yourself in your garage.

                          And don't forget to comply with your council, hiding a 5kg + roaster could be difficult.

                          Like Chris has said............do your homework.

                          Comment


                          • #14
                            Originally posted by chokkidog View Post
                            Hi 13bob,

                            Some good advice also some less than good advice......... but that's the internet.

                            As you're in the planning stage take Graham's wisdom onboard, having a handle on your costs will reveal your margin and therefore

                            your business's ability to become self supporting.

                            You are going into competition so look to give yourself an edge. At first this won't be in terms of an enviable reputation for awesome roasts

                            but will come in the form of things like low overheads, the ability to sell yourself and clever sourcing of good bean stock.

                            Don't take the advice of lining up a swag of SO's or half a dozen different roasts like you're a hotshot roaster with a loyal following several ranks deep....

                            you will fall in a heap quick smart by having too much cash tied up in bean stock and too much unsold roast going into the garden.

                            A couple of good blends out of a stock of maybe 4-6 different beans, 1/2 of which can do the honours as an SO, but only two at a time and not straight away.....

                            work your way into it. .......you will actually find that the market, as a whole entity, is quite uneducated.

                            A couple of good blends that you can produce consistently for 3-6 months without changing will win you more fans

                            than an arsenal of exotic sounding coffees. After all, most people are actually from ' Shropshire ' ;-)



                            Get to know your market, ..........roast to your market.

                            Find a couple of farmer's/ food markets where there is no dry coffee being sold, see if you can get a stall. Stay away from markets

                            that have too much crafty stuff or are awash with 'trash and treasure'. These markets attract a lot of browsers who will head down

                            the street afterwards and spend their money on coffee elsewhere.


                            People come to food markets to stock their pantries.

                            Get some return customers. That will give you confidence, then build on that.

                            But learn to roast first. If you're going to make a living you'll need to be banging out at least 100 kgs/week..... if you have

                            no business debt, no business credit card, own all your roasting gear, have no kids at home, own one car and a small mortgage.

                            And do everything by yourself in your garage.

                            And don't forget to comply with your council, hiding a 5kg + roaster could be difficult.

                            Like Chris has said............do your homework.
                            thanks, chokkidog I appreciate your advice and you've given me a lot to think about.

                            I started out just wanting to run a very small coffee shop mainly doing t/a trade in a busy suburb location but didn't have the balls to back myself.... Thought that starting out with an online coffee roasting business was an "easier" option.... But looks like I was wrong!

                            Comment

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