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Accessing new and interesting coffees

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We work with many farmers who want to create their own routes to market. They have established places to sell their coffee.  However it is important for any business to have a mix of ways to sell their product. Traditional means of sale may be reliable, but may not be sustainable. A long recurring contract is useful, but is it sustainable? Does it pay quickly? Many producers have relationships with importers and organisations who provide finance and the development of the crops. 

Through our work promoting the auctions running on our auction platform we speak to producers all the time. They all want to expand the opportunities  available to them. However, for a variety of reasons, it is not always the best or quickest way to sell the coffee.

An auction provides a wide audience a window into a range of available coffee. But this is also the case for direct trade. The price discovery mechanism is different but outcomes can be the same; new relationships are created. If all goes well, repeat business can be agreed the next year. 

How we work with direct sale:

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• We have an offer list which we update as we meet farmers, coffee are removed as they are sold. Coffee is added as we find producers we want to work with.
• We circulate the list to our buyers.
• We discuss the quality of coffees with the buyers: Its suitability, volume and price.
• We also talk to them about shipping and develop an understanding what will work for both the buyer and the seller.
• We arrange for samples to be sent direct from the producer to the buyer.
• Once the quality of the coffee is understood we usually agree a FOB price on the farmers behalf.
• We do this in a way that suits everyone. We have already agreed reasonable margins on which to base the discussions based upon volume.
• We then introduce the buyer to the seller who agree the contracts and other details, such as shipping.
• We can also help the buyer with payments if they are nervous and want to make sure the money they invest in the coffee reaches the farmer. Sometimes this is key to a deal being agreed. It is valuable for both parties in the sale.

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To broker these trades we charge the producer a commission (%) once the sale has been agreed. 

In the same way we operate our auctions, we put buyers and sellers together. It is a natural extension of that process. In some cases we help bring new and interesting coffees to the market for the first time. 

The size of the supply chain is reduced: buyers can buy directly from the producers. This means more of the purchase price of the coffee goes back to the farmers. This means they can re-invest in future crops and create a more sustainable environment for the development of their coffee and their workers production of the coffee.  

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Auction Overview

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We have been operating online Auctions for since 2011. During that time we have built up a Strong understanding of what is works and what doesn’t. We have a strong set of producers who wish to work with us, and we have a good list of buyers who trust us.

We also have developed a good understanding of how we can facilitate direct trade between buyers and sellers, how the logistics might work and also the pitfalls for both buyer and sellers in coming to an agreement to buy coffee and making sure they receive the quality they bought. 

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Auction Process

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• We display the brochure of the next auction or auctions.
• Typically the brochure will go live 6 weeks before the auction day
• We cup the coffee independently and provide a cupping report for each coffee on the auction platform.
• We only auction coffee scoring 85 and above.
• Buyers register to bid on the auction
• We send out samples to those buyers interested in the each of the coffees.
• The buyers cup the coffee and decide which coffees they would like to buy.
• On the auction day, usually at 10am (London) we will start the auction. 
• Each lot will be open for bidding and the highest bidder will win.
• Bids are placed on the basis of an FOB purchase.
• The buyer pays 3.5% commission for each coffee they buy. This covers the cost of running the auction on behalf of the producer.
• Once the commission has been paid, we introduce the buyer to the seller and you agree the contract of sale for each of the coffees you have bought. 
• At this point you can discuss the logistical side of the sale. 
• We can help, such as providing help with payment and understanding logistics. More details can be found here. 
• We can also help with payments and the banking side of things if as a buyer you are nervous of agreeing a sale with a producer for the first time. We want this to succeed as much as you do.

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What does it mean for you?

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We are aiming to provide a price discovery mechanism for producers so they can understand how the quality improvements they make in their production methods are rewarded.  

We are going to make the auctions up with a series of different coffees each time we run them. We think we will run auctions weekly, depending upon the season and the amount of coffee available at any one time. We are not looking to sell whole containers in one go from one producer. As much as this is attractive to a farmer, this is not always something a buyer will want to do at the outset of a relationship. There is a balance to be struck between accessing new and interesting coffee, and building the relationship in a way building trust. 

Shipping coffee in a complex business. Consolidation is the key and some countries are set up in better ways than others. Kenya for example consolidates all the time. So out may be, from the buyers perspective coffee can be won through an auction from a range of buyers and shipped in one container in a easy way, once terms have been agreed.

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Facilitating Trade

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We are based in Brighton in the United Kingdom and are recognised as experts in online coffee auction software and have a global client base spanning 5 continents.

We facilitate international trade between coffee producers in Africa and South & Central America and qualified buyers in all over the world. We do this by promoting and marketing the auction to our strong database of coffee buyers. We reliably manage $millions of green bean sales on our platforms every year working with key players across the industry. 

Our auctions have sold the most expensive coffee in the world over the past two years breaking the price record in both years. 

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Sustainable & Repeatable Trade

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Our desire to create sustainable and direct routes to market for producers is the motivating factor. We continue to generate interest from coffee producers who realise the potential for their business in using us to operate their auction platform. This means our outlook and list of services has matured over this time. 

We are now in a position where we can provide different levels of service depending upon the needs of the 

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Marketing and Promotion

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Our desire to create sustainable and direct routes to market for producers is the motivating factor. We continue to generate interest from coffee producers who realise the potential for their business in using us to operate their auction platform. This means our outlook and list of services has matured over this time. 

We are now in a position where we can provide different levels of service depending upon the needs of the 

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Good Understanding of Marketplaces & Auctions

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Working with buyers…naming contacts. Experience in other industries and market sectors. Online marketing. Direct Sales. Negotiations Skills.

 

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