As we all know the global coffee industry is worth over $100 billion dollars worldwide. And exporting alone is a $20 billion-dollar industry, mostly consumed by industrialized nations while being produced by the world's underclass.
It is so beloved today, and it’s the world’s second most consumed beverage; that you would never know that drinking coffee alone makes such a huge impact in our global economy.
Coffee brands and cafes worldwide have historically been associated with decent practices and fomenting positive change.
Yet we are far from the truth, in fact it’s totally the opposite. In the past decade the industry has actually been adding to the most insidious socio-economic trends we face today – increasing income inequality, gender inequality, water contamination, just to name a few.
As we think about this issue, we would do well to examine the role, we as an industry play and how each of the existing industry leaders can make a positive impact by adapting more socio-economic and sustainable practices in their supply chain.
Today, consumers sit in cafes discussing and lamenting the rising trends of inequality worldwide, yet we fail to realize that we are the number one contributor to this factor. We all know that farmers are not getting any benefits from the high profits of the industry. Fair trade, direct trade, etc. are all attempts in varying degrees and with varying commitments to change that. While many farmers have benefitted from these practices, in over thirty years in the industry, reports have shown that we have yet to see significant improvement to farmer income and quality of life over time.
According to UN statistics, the ratio between what a farmer received in the 1970’s versus what a retailer receives was roughly 1:3. Today it’s about 1:8 or 1:10.
As an avid entrepreneur, with a portfolio of positioning products in retail for the past 15 years and turning some brands into million-dollar brands within a year, I can say that it’s all about product placement and the added value you offer to your consumer. I have never seen an industry take so much advantage of their bottom-line supply chain as the coffee industry. And while yes, we are a coffee brand, our commitment is to truly source ethical coffee, complying and contributing to as many Sustainable Development Goals of the United Nations, while yes making a profit. It is possible.
While many large brands across the world will disagree with me, I truly believe that the more added value you add to your product in today’s market, more loyal consumers your brand will attract.
Today, millennials have made a huge impact in our global economy and trends. Now consumers are more interested in learning where their coffee comes from, how it contributes to sustainable production, the experience one as a consumer can have with the brand by interacting and being part of this process. I have seen it, I have lived it and definitely see the potential we have as responsible business leaders to make a difference.
As with every industry, it evolves with time. We as coffee industry leaders must understand and undertake the task to deliver more at the same cost to the consumer by contributing to more sustainable practices that benefit our farmers. Because without them, we would not have a brand.
An example of us not catching up to trend and facing the unforeseen circumstances of closing doors for good, is what the brick and mortar retail industry has been faced with today. Buying and consumptions trends have changed, and we must change with them.
Today consumers want more than just a cup of coffee, they want an experience. And here at XOL, we want to make a difference.