With the popularity of direct coffee sourcing model almost every company is using the term in the marketing messages, but in reality few really do it.   There are also various grey points in the methodologies used . The purpose of this presentation is to clear those points and give a fairly good idea on how direct works.

1. DIRECT TRADE COFFEE
Clearpath Coffee
www.clearpathcoffee.com

2. What Is Direct Trade
• Is a coffee buying model, in which the
importer/roaster has personal relationship
with the producer, has a transparent financial
transaction, and ideally have visited or is
planning to visit the farm.

3. The Problem With Marketing
With the popularity of direct coffee sourcing
model almost every company is using the
term in the marketing messages, but in reality
few really do it.
There are also various grey points in the
methodologies used and on how to do it. The
purpose of this presentation is to clear those
points and give a fairly good idea on how
direct sourcing should be done.

4. Why Has Direct Sourcing Became so
Popular?
• It offers competitive advantages in the buying
and selling side for the coffee roasters (more
on this later).
• Helps to connect the final consumer to the
coffee source.
• Has a positive social and economic impact at
origin, that gives an extra meaning to the
business.

5. What Are The Buying Advantages
Direct Trade Offers?
• The opportunity to develop a strong
connection with the suppliers (cooperatives
and producers)
• The opportunity to secure exclusive coffees
which quality meets exceptionally high
standards
• To control pricing variance.
• The unique opportunity to experiment with
processing and varietal variation.

6. What Are The Selling Advantages
Direct Trade Offers?
• The personal relationships and regular farm
visits create a story that roasters can use as
unique selling points.
• The exclusivity and promotion of direct
sourcing and single origin coffees can help set
a roaster apart from his competitors.
• And buyers photos on the origin experience
create great marketing material for websites,
and social media.

7. Who Is Involved In A Direct Trade
Transaction?
Direct Trade doesn’t mean that producers
export the coffee on their own or that the
roasters import the coffee on their own. Most
roasters regularly engage exporters and
importers in direct-trade relationships.

8. Who Is Involved In A Direct Trade
Transaction?
I. Grower. Is the responsible of producing a
specialty coffee.
II. Coffee mill and exporter. Responsible of
milling and move it out of the origin country.
III. Coffee importer. Is in charge of helping the
roaster with the financing, importing and
logistics to the final destination.
IV. Coffee roaster. Must be involved in the
whole process.

9. What Is The Relation Between Direct
Trade And Specialty Coffee?
• For a sustainable direct sourcing relationship
coffee quality must be exceptional. Roasters
have to do a significant extra work in order to
direct source their coffees and usually pay
extra costs for logistics and travel. The coffee
really needs to be great so the extra work pays
off.

10. Why do Farmers Like Direct Trade?
• A producer with a loyal buyer is often
guaranteed a market for their coffee each year
and, likely, at a good price regardless of
external market pricing.
• In some cases, this guaranteed market also
comes with willingness to pre-finance farmers.
This cash flow allows producers to care for
their families and also to invest farm with the
aim of producing even better coffee each year.

11. CHALLENGES OF DIRECT TRADE
Our Experience With Colombian
Coffee

12. Challenges Of Direct Trade
I. Finding an exceptional coffee at origin:
Finding a good coffee supplier at origin
involves a good amount of research and most
of times travelling to origin.
Coffee conferences and international coffee
auctions are good ways to be introduced to
great farmers.

13. Challenges Of Direct Trade
II. The need of experience and resources to bring
in the coffee.
The negotiation at origin with a producer can be
challenging mainly if they don’t have past
experience in this business model. Usually
upfront payments are requested and the
participation of a coffee mill, coffee exporter and
coffee importer is a must. These links should be
in the picture after the coffee is bought from the
farmer.

14. Challenges Of Direct Trade
III. Exports and Imports logistics.
When the quantity of coffee is less than a full
container load, the roaster or importer will
have to find a bigger importer who can
consolidate the shipment with others they are
moving out of the same country and area
inside the country in order to save on shipping
costs. This process can often take several
weeks.

15. Challenges Of Direct Trade
IV. Securing coffee quality.
In the traditional green coffee business model the
importer is responsible to delivering an agreed quality
to a final client or roaster. The importer is then
accountable for arrival quality problems, which may
mean discounting poor-quality arrival coffee, replacing
it, or even simply canceling the contract. None of these
is an option in a direct-buying scenario. This s one of
the most potentially devastating issues in direct
business and reinforces the need of finding good
partners at origin who have experience in coffee
quality and coffee exports.

16. Invitation
• If you would like to know more about our
services, how we can help you with the direct
sourcing of Colombian specialty coffee and
have access to our monthly reports with
information of available coffees write to
Vicente Mejia at
vicente@clearpathcoffee.com mentioning
your company name and activity.

17. THANK YOU!
Vicente Mejia
vicente@clearpathcoffee.com