The thinking in specialty coffee has long been: quality doesn’t scale. There’s plenty of evidence that this is true but I’ve become increasingly interested in the why, because there is evidence to the contrary. I’m going to look at an facet of the industry that is closest to dwelling for me, and probably the region in which this is generally held to be true: coffee roasting.
In a technology obsessed world, scale has been something of a buzzword but I think it is important to differentiate business that are reliant on scale, where magnitude is baked into the financial model from the beginning. These are businesses with high fixed costs, but the cost of a brand-new patron or sale is very low or effectively zero. The classic modern period example is Facebook. The people and the servers are there, and adding one more report expenses nothing. Aside from a potential spend on marketing, “there hasnt” cost of goods. In addition the labour involved doesn’t scale with customers in a linear mode. A business like this can lose fund, and lots of it, at the beginning but once it reaches a critical mass it becomes incredibly profitable.
A coffee bar is different. Not only does each booze have a fixed cost of parts, the busier a coffee shop gets the more personnel it needs. The ideal theoretical model for coffee shop would be to find the maximum number of drinks a attached staff could serve, and then equilibrium price and character to be as busy and expensive as is practicable for that secured labour rate. Nonetheless, any additional proliferation would have to come from additional coffee shops- a whole other challenge of decentralised scale.
This is a roundabout way of discussing why scale is often talked about as good or necessary. Coffee roasting is one area of the coffee appreciate chain where some scale is possible relatively easily: buying a bigger roaster allows the same team to scale, or a brand-new roaster plus package equipment does if there is a desire to not is therefore necessary to scale production labour at all.
So, if we are to consider why character doesn’t magnitude then we should consider the aspects of coffee roasting that may be the barrier to retained quality. I’m going to ignore the practices issued by business that intentionally compromise tone to grow brand-new sells or possibilities. Those are just strategic decisions and not limits to quality’s growth.
Quality Doesn’t Scale 1. Raw materials
An area that many would point to, when looking at the decrease in tone when a company scales, is in its raw materials. This constraint is almost always self imposed- it isn’t that there isn’t enough coffee of a sufficient character, it is more likely that the decision has been made to leverage some form of capitalist growing, and to leverage volume for lower rates. This has likely had contributed to declining sale pricing to gain proliferation, which the company feels the need to continue to feed. Thus they invest less on their dark-green coffee, to make their product increasingly inexpensive and able to gain the growth.
However, this is a strategic decision and not an obstacle to character. At some level government decisions could have been attained not to compromise excellence to retain gross margins at lower price levels, leadership in the company could have insulated the purchaser from the pressures of the sales team. The implication is that perhaps there isn’t a sufficient marketplace at the higher rate degree and that you can only grow at lower rate points. I’m not persuasion this applies, and the growth of speciality as a whole indicates that there is significant proliferation left at higher rate degrees as long as the value of the product matches the price.
There are two ways in which I can see scale impacting roasting negatively, though one remains more theoretical. If a roaster develop and has to run more batches per week then this is going to introduce some degree of incompatibility.( My recent complaints about roasting machines seem relevant here .) Time constraints on a squad intend less is now time to QC, and increased workloads take a physical tole- a more fatigued crew can expect to attain more mistakes, or let more mistakes through a QC process.
This problem should be alleviated by capital expenditure: buying a bigger roaster. There is likely a sweet smudge when it comes to the size of a production crew, the number of machines, and the number of batches. Busy enough that profiles are developed and have time to be well refined( for additional learning and understood it future profiles) but not so busy “theyre about” extended. a
The theoretical second challenge is the idea that a larger ability roaster is not able to achieve the same makes as a smaller batch roaster. It isn’t uncommon to see the words” tiny batch” use across industries to signify the handmade, careful quality of something. However, I think too many small-time batches is likely a bad thing. As for whether or not large roasters can achieve the same level of quality- I believe it is possible, but difficult. There’s also the challenge of the expense of a hear arc. Hurling away a bad 10 kg roast is annoying, but throwing away 69 kg of a failed batch is a lot more painful- specially when there may be very limited sums of a coffee. This can all be factored in, but it would likely drive sale prices up( marginally of course, but they’d certainly induce reducing rates as a itinerary to grow … challenging ). I may be proven incorrect, but I believe this is a challenge and not an absolute barrier.
3. The Human Factor
Coffee roasting remains an extremely human liaison. There are certainly those who will ever enjoy that, and those who would be delighted to supersede humen with automation- specially if it improved coffee. For now, we need people who are of interest to the outcome in roast coffee, and it isn’t possible to build external systems that relibaly restraint tone.( Or, if it is- I haven’t seen it ). In a competitve market the human resource grows exceedingly scarce. Lots of roasting corporations would like to find great people, but currently necessitate outstrips supply.
I could imagine one debate about why character doesn’t magnitude is that people who care about what the hell is stimulate may be less committed when making larger volumes. It would feel less “craft”, less “intimate”. Nonetheless, this implies that they couldn’t achieve great excellence at magnitude and surely if you cared about great coffee then developing large amounts of it at the highest level should be incredibly desirable- there used to be undeniable positive impact on lots of people. Again, if you grow to the sizing where you have the largest viable machines and are still producing extraordinary numbers of batches- I could see that being dispiriting and thwart and, when you have so many patrons that they become faceless, a loss of intimacy with the customer would take away a pressure for excellence.
Magnitude Enables Quality
I also want to discuss the ways in which scale might increase or enable quality. What induces everything there is so confusing is that I belief scale is necessary to increase character, and allows significant leaps in beaker character and consistency.
1. Raw Materials
Buying coffee is uttelry entwined with scale. The committee is endless narratives from frustrated exporters, who have given up time to visiting customers, toured them round farms and mills, only to have the purchaser buy a couple of pallets of coffee. I think there is a significant change in the buying process when you’re able to buy at least one full 40 ft container from a single origin.
Scaling up buying can come with access to what is necessary. Scaled up buying entails buying with greater impact, which can be used positively( in terms of quality b ).
I see many coffees buy better and better as they scale, until they reach a point when the resource requirements from sourcing changes. That isn’t a consequence of buy, but of a changing strategy. I conceive scale clearly allows better quality purchasing.
The primary region I believe that magnitudes allows tone in manufacturing is through improvements to equipment and to quality self-control. Colour readers are useful. Better probes and roasted logging software is useful. Having the financial resources to train and upskill product crew members all enable quality, and all have substantial costs that scale offers an opportunity to overcome. Scale enables greater restraint of packing- should you want to go down the route of modified ambiance or different materials. It isn’t a requirement, but it helps.
There’s a buzzer curve in roasting, as mentioned before. I anticipate getting roasted more frequently makes one a better roaster, increases understanding of a coffee and stirs it most likely that you’ll work through a lot before it begins to change or degrade.
Increased magnitude is advisable to develop sufficient earning to invest in R& D( though so few speciality corporations do ), and in product progress. Increased scale is advisable to allow for the setting of tighter benchmarks of quality, because losing a single missed roast is less consequential( unless you’re going through the jump-start phase when you’ve scaled up equipment but throughput doesn’t yet match it ).
3. The Human Factor
A form fill and seal machine, that takes a rolling of foil, valves and coffee beans then spits out finished bags of coffee is a troubling thing. It forced me to contemplate a difficult question: Is it better for a company to create several low-pitched paying jobs, or fewer chores that fee better and are more enjoyable? While we decided on the latter, I do concede that there are arguments for both sides.
As mentioned above, magnitude creates resources that can be invested into staff: better renumeration, better benefits, more training and education. This should lead to better retention and improved performance- and hopefully increased job satisfaction to go with it.
So why doesn’t quality scale?
I genuinely look forward to people refuting some of the ideas above, and arguing with me- this is the real degree of sharing suggestions on here. I am aware that I have argued absolutely that character can scale, surely to a very large size- greater than we have determined people scale in practice. So, how can I argue this in the face of what I find out in the world?
I’m going to make a counter argument: Tone can scale, but financing of the simulations we’ve chosen prevent it doing so. At some phase firms make a decision about how to increase net profits, by choosing to decrease rates. Under these pressures tone very quickly falls by the wayside. This implies that there is no ceiling to the market, which is obviously not true. Growth surely becomes more difficult as you scale up and a market feels saturated or fully mined for appreciate, and many companies chase that tip-off level of magnitude where the power of the brand becomes a multiplier “of ones own”. Blue Bottle spring to mind as a business chasing this brand intonation degree. There will be many pressures to get to this degree as soon as possible, and we haven’t really discussed the rate of growing. Many jobs may have pressure to develop rapidly in order to return the investments that allowed that rise, i.e. an investor who wants a return within a certain timeframe.
This pressure of speed is another reason people alter their financial simulates. Quality can scale, but I think there are hard limits on how quickly it can scale once it is a grown-up business.
Disclosure: a large part of this thinking has come as research results of SQM buying a larger roaster. We’ve grown steadily over the years, and I genuinely believe that we’re roasting better than ever, and more consistently too. While I’m frustrated by the roasting process, I’m proud of what the team accomplish. I’m not really are of interest to scaling at the expense of quality, so it started me down the line of this thinking.
The challenge of where that CapEx may come from, in a business increasing rapidly that has its earnings tied up in inventorying or busines debts is a whole other conversation. I understand one route would be investment, and that may come with an belief of scaling up to return on that investment. I agree this may add a pressure that makes growth difficult, but as a single instance it didn’t seem sufficient to bring it into the main discussion. ( back )~ ATAGEND what characterizes ethically better is now highly fuzzy and outside of the scope of this part ( back )~ ATAGEND
The challenge of where that CapEx may come from, in a business increasing rapidly that has its profits tied up in inventorying or trade indebtedness is a whole other exchange. I understand one route would be investment, and that are able to come with an belief of scaling up to return on that investment. I concur this may add a pressure that constructs growth difficult, but as a single instance it didn’t seem sufficient to bringing it into the main discussion.what characterizes ethically better is now exceedingly fuzzy and outside of the purpose of applying this piece
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