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Time = money
In business, old axioms are the best axioms.
Growing a business is exactly like raising a child - a thousand things to consider, and all of 'em are totally personal.
Momentum is more than essential or inevitable: it is inexorable. Once committed there's no turning back, and when the unthinkable (or never before considered) happens, the only response is to deal with the situation instantly and effectively. That requires resources that can be tapped, and all resources are inherently economic.
Time is not a resource, but it is currency; however, the exchange rate is onerous and comes at the cost of momentum.
Danes, like Ethiopians, drink coffee to sanctify any social occassion. Breaktimes at work, afternoons among friends, weddings, baptisms, anniversaries: Coffee is an integral part of the ritual, marking every occasion and non-occasion, the eternally popular beverage of lifestyle.
Buna might have worked uniquely in Denmark, if only because geographically and culturally, the consumer market is well-defined and finite.
That, and Danes per-capita annually consume 9.8 kg of coffee - 20 pounds for every man, woman, and child in the land. Works out to 6 to 8 cups for every Danish consumer in the course of a single day.
50,000,000 kg of coffee sipped inside Danish borders in a year, more than 10,000,000 pounds every month: You'd think the Market would find a place for Buna's paltry 500 kg...
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Coffee is the world's oldest internationally- traded commodity, and today is second in product value only to black gold, Texas tea.
Therefore, everything about the coffee industry
is a highly evolved cartel, and every level of commerce in it is very profitable;
therefore, every business that peddles coffee is highly territorial and averse to competition.
(6 Danish kroner = $1)
Costs, per-shipment
500 kg to CPH, kr 28,000
+tax, transport = 36,000
Bags, 1000 kr 1,000
Office & production consumables 1,000
cost, kg = +75 kr
Sales prices
Retail (250g bag) = +80 kr
.
(w/ tax) kg = 320 kr
Wholesale, kg = +130 kr
Sales projections
200 kg @ retail = +66,000
200 kg @ wlsl = +26,000
100 kg @ mix = +40,000
500 kg sales = +132,000 kr
(gross, pre-tax)
est. net, after tax (25%),
500 kg = 56,000 kr
profit-per-shipment
.
Danes cherish few things more than a sunny day.
Ægte
kaffe
4. The Market
Five views of the Black Diamond
.
A "must see" when visiting Cph!
#4: All markets are local.
Especially coffee.
#5: Coffee numbers
always add up.
.
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Shelf life
Fresh coffee
Never freeze coffee...
Central Copenhagen was built in the 19th century, a durable architecture of stone, brick, and orange ceramic tiles built to high standards of engineering and construction - for which Danes are known, along with a sense of "modern design".
.
The Royal National Library typfies the cultural continuum, tradition evolving with changing materials, methods, tastes: the sturdy historic structure remains relevant, up to date, a vital part of the community in daily public use - while the modern glass edifice excites the eye and imagination. Ride the escalator to the first floor, just for the experience!
In there is a metaphor for coffee business. Along with an opportunity to show off some pretty pictures...
It was never the plan to Do Things Different for the sake of doing things differently. - just to be super-efficient, keep things simple, Overhead low - and avoid head-to-head competition.
free coffee exclnt advertising, and cheap
Two things you should know about coffee people:
Coffee consumers are fickle, constantly searching for better - better flavor, a better place to buy a cup - particularly, if you are Danish, better price.
Coffee consumers are loyal, once they find a tasty cup and a cozy place to drink it in, at a good price, they'll come back time and time again.
To most people coffee is personal......
One of Buna's primary wholesale targets
was Copenhagen's wine merchants.
On the one hand, through the post-war era Danes bought their coffee from a selection of burlap bags at their local vinhandlers. Many still displayed their belt-driven grinders with pound-sized chrome hoppers on top - though they offered only bags of very inexpensive Java-blend.
On the other hand, people who pay 150 Danish kroner, $25 (and more), for a bottle of wine expect a certain experience - bouquet, acid, body, subtle flavor nuances - from their investment. Often, these discerning folk will make an evening of dining at home with friends, and take great care matching the meal to the fruit o' the vines in the fluted crystal glasses. Then, basking in success, they'll serve java blanding and think nothing of it!
Note: The language and rituals that wine people, professionals and lay-persons, use to describe what their palates experience, are exactly the same used by coffee "liquorers" and cup-tasters. Wine, like coffee, comes from a fruit, fermentation is a critical part of the process - as is aging; "fresh", a highly-relative term, can be as appealing in a coffee cup as it is in a wine glass.
So instead, after fish, keep the conversation going over a cup of Yirgacheffe, the "industry standard" for brewing the perfect balance of aroma, acid, and body, with a delightlful personality free of the Complexities of man-made blends. Or, after a rack of lamb, a hearty dark roast Mokarar Harrar - the espresso bean, uniquely, makes a mellow, full-flavored, genuine mocha cup of coffee...
At half the cost of that modestly-priced bottle of wine, that bag of Buna coffee would still be in that discerning consumers kitchen four days later.
When compiling the capitalization budget, do the research, ask every smart question you can imagine, come up with a bottom line. Then double that figure -
.
and double that figure. You should be good.
.
It's the question you don't consider, that you never think to ask, that'll get you in trouble.
While building the third Bunavogn - next page - my workshop neighbor, a master craftsman, looked in one day to see my progress. I showed off improvements on the original design, mentioned the challenges and my cleverness in solving them. He sagely chuckled.
"You always build the first one 3 times."
#6:
#7: