How grocery chains purchase Premium Guatemala Coffee
Here is why EFG works for both the Guatemalan coffee growers and roasters AND the US independent grocery chains.
Currently, Guatemala is approaching the start of its coffee harvest with the expected contract price paid for a pound of Premium green coffee beans of $1.09 per pound.
Roasted beans under contract are expected to sell for $1.87 per pound.
The cost for a large farm to grow, harvest, and process a pound of beans is $.90 per pound, leaving very little profit for the growers.
However, when US grocers buy their premium coffee through the EFG model, they pay $9.50 per pound, which includes the cost of shipping.
Remember that EFG takes NO profit from the coffee supplier or the grocer. The growers gain more in profit through the EFG model and the grocers will see a 25% to 35% profit margin through the EFG model. In addition, private label packaging is also available including point of sales materials and other marketing needs a grocer may have.
Also note that while shipping bulk coffee from Guatemala to grocery warehouses in the US requires that the shipment meet FDA Food Standards Safety guidelines, shipments of bulk beans sent directly to each store in a grocery chain are not required to meet those standards since the product is not being stored for an indefinite period of time in warehouses.
How grocery chains purchase Premium Guatemala Coffee
A Guatemala Company has changed how small grocery chains can purchase Guatemala Premium Coffee with the advantages of higher margins, less inventory, and greater product freshness.
Guatemala City, Guatemala August 12, 2020:
Ethical Fashion Guatemala (EFG) announced today the expansion of their brand “On-Demand Roaster Guatemala Coffee,” targeted for small independent grocery chains.
The business model is simple:
EFG worked with Guatemala Coffee Growers and Roasters to develop the logistics for providing US grocery stores with freshly roasted coffee that can be ordered on Monday and delivered to any location in the US by Thursday.
The advantages for a small, independent grocery chain are increased profit margins from having no minimum order, no excess inventory, and no brokers or wholesalers since buyers are dealing directly with the coffee growers or directly with Guatemala Roaster.
EFG provides shipping logistics and takes no profit from the coffee supplier or the grocer. EFG provides the exporting services under contract with international shipping service DHL.
The average retail price of Premium Arabica Coffee across the US sits at the lower end at $12.00 for a 12-ounce package.
For bulk sales, the cost is $10.99 per pound—and these prices are for mixed, lower-end coffee beans. However, the EFG model provides grocers with a 25% – 35% profit margin on coffee that is Premium-rated, High Mountain-grown, single-origin Arabica.
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