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Supporting the Canadian Coffee Scene by Mark Prince
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MarkPrince
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Posted Fri Jun 4, 2004, 12:00am
Subject: Supporting the Canadian Coffee Scene by Mark Prince
 

Supporting the Canadian Coffee Scene
by Mark Prince

Mark Prince takes a controversial view of the Canadian coffee scene as he previews this year's Canadian Coffee and Tea Expo.
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Posted Sun Jun 6, 2004, 3:15am
Subject: Re: Supporting the Canadian Coffee Scene by Mark Prince
 

We went last year and the show wasn't huge, but I did meet many people who were so friendly. There is a real different feel to the Canadian show as opposed to the US shows.

This year we're going again. Mark is right, even if you aren't interested in buying anything or you think you know everything the seminars have to offer, the people you meet make the show wonderful.

 
- Alexarc -

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"Be seeing you..." -#6
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Posted Sun Jun 6, 2004, 9:49am
Subject: Re: Supporting the Canadian Coffee Scene by Mark Prince
 

It's funny Mark - you are right about so many things re: being Canadian, or Business in Canada.  Another personal beef for me is this:
How many independent cafes and coffee shops have you seen featuring "organic" or "fair trade" coffees?  There's lots, and I see more and more of these everyday.  The problem is - these cafe owners and employees think that this is all they have to do.  Forget about quality or service or excellence - as long as I've got the prominently displayed fair trade logos and signs, the organic logos etc - why worry about actually making good coffee.
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Posted Sun Jun 6, 2004, 11:52am
Subject: Re: Supporting the Canadian Coffee Scene by Mark Prince
 

Mark, you hit the nail on the nose with this one, eh?

If there is one thing the Canadian industry needs, it's a sense of cohesion.  It seems the industry is highly fragmented; futhermore, the Canadian Specialty Coffee Industry IS NOT yet a "mature" industry.   Prices on consumer machines in Canada are high, relative to American prices.  Competition or market saturation is so low that cafés can offer a low-grade product (drinks, roasted beans) without fear of consumer backlash.

 
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Posted Sun Jun 6, 2004, 1:30pm
Subject: Re: Supporting the Canadian Coffee Scene by Mark Prince
 

Mark, Firstly I disagree with "If you're a cafe owner with one or more locations, you should have a booth at this trade show".  

Direct from the trade show brochure itself, under who will attend: senior industry buyers, owner-operators, chain store purchasing agents, restauranteurs, hoteliers, consultants... suppliers.  The first three words of the brochure are: "Join your colleagues"!

Basically what they are saying is who is attending is also exhibiting: people in the business.  Not consumers.  So why would I spend $1300 for the booth, double that for the time, staff and inventory to pour free coffee for my suppliers and greasy franchisers who want to pimp out my shop?!

This coffee trade show is not consumer oriented, nor attractive for small shops (or even big ones) to participate.

Its great that you encourage shop owners to get involved, but really, you should go talk to the organisers.  Currently, the only way for small shops to be involved is through the Barista competition.

Besides spending 3 grand on this show, another way for me to quickly bankrupt myself would be to "stock a pallet of six quality espresso machines and grinders".  For a small shop to put out thousands of dollars for inventory... well it might just be the last thing they do.  I'm not saying don't buy machines, I would just suggest ordering one demo machine and one for stock as a more realistic approach.

I'll get to the rest of my disagreements with you (about canadian business) later ;o)

Alistair.

 
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hopkin
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Posted Sun Jun 6, 2004, 6:32pm
Subject: Re: Supporting the Canadian Coffee Scene by Mark Prince
 

espressobsessed Said:

If there is one thing the Canadian industry needs, it's a sense of cohesion.  It seems the industry is highly fragmented; futhermore, the Canadian Specialty Coffee Industry IS NOT yet a "mature" industry.   Prices on consumer machines in Canada are high, relative to American prices.  Competition or market saturation is so low that cafés can offer a low-grade product (drinks, roasted beans) without fear of consumer backlash.

Posted June 6, 2004 link

No sense of cohesion?  You describe the geography of our country.

Canada has a population about the same as California, yet spread over a land mass larger than the entire United States and have a political and very beurocratic border between us and them.  Furthermore, many manufacturers and distributors are just not interested in dealing with the canadian market.  The border is a hassle, and the volumes are too low.  These are just a few issues that make doing business in Canada challenging.

But not only nature is to blame for not being able to buy the espresso machine you want in Canada.  I believe a major blame is the consumers here who will not pay the extra dollars to buy local, instead buying from large american companies here, or ordering from the US based on price alone.  Canadian companies are discouraged from competing because Canadians see too little importance in buying locally in general.  This hinders our entire marketplace.  It costs more to do business up here, and it is not the fault of the businesses themselves, so don't be so fast to blame them.

Mark: the fact that there is no "single company that even comes close to the online professionalism and service levels" of the big ones in the US, is because a large market capacity doesn't exist here.  If Whole Latte Love did business ONLY in California, they might still be run out of garages.

A comparision of business in the US and business in Canada is unbalanced.  We are (dispite trends) entirely seperate nations with completely different makeup.  For 99% of the time this is a fabulous fact.

Alistair.

 
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MarkPrince
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Posted Sun Jun 6, 2004, 8:38pm
Subject: Re: Supporting the Canadian Coffee Scene by Mark Prince
 

hopkin Said:

Besides spending 3 grand on this show, another way for me to quickly bankrupt myself would be to "stock a pallet of six quality espresso machines and grinders".  For a small shop to put out thousands of dollars for inventory... well it might just be the last thing they do.  I'm not saying don't buy machines, I would just suggest ordering one demo machine and one for stock as a more realistic approach.

Posted June 6, 2004 link

I'll also get to your other points later...

Thousands of dollars is a bit of an exaggeration. I'm not talking about stocking pasquinis or isomacs. You can get 3 SL-70s and 3 Maestro Plus grinders for probably about $1,350-$1,500 wholesale. Even three silvias and rockys would be under $2K.

The fact is, I have yet to see a cafe stock *any* decent machine in this marketplace. Even JJ only stocks a couple of Maestro plus grinders.

Vince was talking about stocking a Vibiemme machine, but I haven't seen that yet.

Mark

 
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Posted Sun Jun 6, 2004, 10:18pm
Subject: Re: Supporting the Canadian Coffee Scene by Mark Prince
 

hopkin

It sounds like you just got a slap on the nose, and in many ways, if what Mark says stings - it stings because it hits you where you are vulnerable.  In the company I work for in Canada, we are leaders with respect to our niche in the market.  And it’s embarrassing how little we are aware of or participate in the industry here.  Sure everyone with a piece of the pie is a millionaire, but where we have only six stores nationally, a comparable competitor who started the same time as we did in another country with a very very similar market demographics and distribution has 145 stores.  Why is this?  Because in Canada we don't do the things you have to do to make it happen.

You should not question trade show participation - it should be a given on some level.  As for stocking Espresso machines, well in my industry, and in my stores I recently negotiated with a vendor to stock hundreds of thousands of dollars of very low turning inventory (in my industry the turn rate of 1 a year is actually good) entirely on memo.  You know where you make those kinds of deals?   That's right!  Trade shows.  I bet you I could find and negotiate with a vendor (either a vendor/manufacturer, or reseller/wholesaler) some arrangement where you could stock a few machines at zero (or near zero) dollars cost.  Suppliers want to open new markets too!  That's their incentive.

If you want to grow and make money - you gotta invest.  Sometimes that investment dollar needs to reach a critical mass.  Identify those factors that could help you reach that mass - cause when you do, your business - any business - will explode in this country.  Mark just pointed out a few of what he considers those factors to be.  It's up to you to find others (and to evaluate Mark's).

But give the guy some credit - he's talking truths here.  Some of 'em are hard for us Canadians to hear, but they are true none the less.   But you know this - otherwise you wouldn't have thrown your helmet in the ring here.  The truths you fight are often the ones you know best.
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MarkPrince
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Posted Mon Jun 7, 2004, 12:09am
Subject: Re: Supporting the Canadian Coffee Scene by Mark Prince
 

hopkin Said:

Mark, Firstly I disagree with "If you're a cafe owner with one or more locations, you should have a booth at this trade show".  

Direct from the trade show brochure itself, under who will attend: senior industry buyers, owner-operators, chain store purchasing agents, restauranteurs, hoteliers, consultants... suppliers.  The first three words of the brochure are: "Join your colleagues"!

Basically what they are saying is who is attending is also exhibiting: people in the business.  Not consumers.  So why would I spend $1300 for the booth, double that for the time, staff and inventory to pour free coffee for my suppliers and greasy franchisers who want to pimp out my shop?!

This coffee trade show is not consumer oriented, nor attractive for small shops (or even big ones) to participate.

Alistair.

Posted June 6, 2004 link

K, I'm back. And I have a simple answer to the above; I won't even address the consumer comments cuz, well, my article already addresses it.

Heres your simple answer....

Zoka Coffee.

Zoka had booths at the SCAA shows, CoffeeFest, NASCORE for years... even when they could barely do any wholesale roasting. Even before Dismas won the N. American barista championship.

What were the booths for? Smart marketing. Look at where they are now. Don't comment on the coffee for a moment - think about the fact that everyone in the specialty coffee biz in the US knows them.

Smart marketing. That smart marketing translated indirectly (but ironically, also directly) into business growth in an explosive nature for Jeff.

And guess who has a booth this year at the Canadian Coffee and Tea Expo... :)

There's one more thing I forgot to mention in my article - a huge difference between Canadian and US small business.

The businesses that grow and succeed in the US do something most small Canadian businesses do not do (in my experience at least): think beyond next week. Jeff was thinking years ahead with his marketing plans and strategies for Zoka. Schomer's done the same with his venture. Hell, the Hines boys are thinking two, three years ahead right now.

Meanwhile, here's a convo I had on the phone last month with a Montreal cafe I'm familiar with....

"so, are you sending your star baristi out here to compete?"

"hell no, that would cost at least $750 in expenses... what possible reason would I have to do that???"

"I've seen cafes get incredible morale boosts, pride in work, and less turnaround when some of their staff attend competitions or jams, and come back talking about how cool their job is...."

"unless I can see a real benefit in dollars right away, it isn't worth my time and effort... why don't they pay the Baristi to attend anyway? it would get more competitors...."

"sigh......"

(the above is almost a verbatim convo .... and I've had similar conversations with other cafe owners over the last year and a half since the first CBC ran).

Mark

 
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hopkin
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Posted Mon Jun 7, 2004, 4:26am
Subject: Re: Supporting the Canadian Coffee Scene by Mark Prince
 

MarkPrince Said:

Thousands of dollars is a bit of an exaggeration. I'm not talking about stocking pasquinis or isomacs. You can get 3 SL-70s and 3 Maestro Plus grinders for probably about $1,350-$1,500 wholesale. Even three silvias and rockys would be under $2K.

Posted June 6, 2004 link

I hate to be picky, but when you said "a pallet" of six machines and grinders i interpreted this as six machines, six grinders.  with your calculation that equals thousands and stocking like that just doesn't make sense for a business unestablished in the equipment market.  after all, our first priority here is to brew and sell top quality coffee.  as so many like to point out, too many shops around here are not even doing that very well.

This aside, i have a question: how do you find the market share to be divided?  I would only guess that most espresso machines are sold by retail/online companies that sell espresso equipment, not by coffee shops selling espresso machines.  Am I wrong?

Dasein Said:

where we have only six stores nationally, a comparable competitor who started the same time as we did in another country with a very very similar market demographics and distribution has 145 stores.  Why is this?  Because in Canada we don't do the things you have to do to make it happen.

Posted June 6, 2004 link

The competitor is in another country with a similar geography and population?  There just aren't many countries like Canada, which also sits beside the largest, fiercest competitor in the world.

I give Mark plenty credit, I think his intentions are excellent.  I'm concerned that he's told me something I'm not doing, but looking through the attendee brochures they are almost entirely industry based, and I think it would be ridiculous for a small shop to spend so much time and money on a booth at this show.  

Mark, the example of Zoka is slightly unbalanced.  I mean a shop started by real old schoolers, the vice president of Starbucks roaster and the vice president of the SCA... of course they were at all the trade shows!  They were deep into the industry way before they started Zoka.  They aimed to break into wholesale roasting and they did it.  Great, but its quite a stretch to compare them to local retail shops aiming to promote themselves to more coffee drinkers.

To suggest small retail shops should participate, I think its a problem that the trade show marketing does not include consumers as attendees.  Despite this, you have written that this is the first year for consumer participation, and that is exciting.

Back to the Canadian Market issue: I don't agree that small operators be singled out for not making an effort, for not taking risks and for the lack of market here.  For a country of this size and nature I don't see why you are all surprised about a slower market in Canada compared to the United States.  The reasons for this are complex and yet obvious, and they will not be overcome when small businesses take huge risks.  Sometimes it works, and we hear about it (Zoka).  When it doesn't, its just another pin drop.

a.

 
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