Black Gold
Push your profits by matching your premium food with a premium coffee
June 18, 2006
If you didn't know David Lange was talking about coffee, you'd bet a bag of beans he was waxing poetic about wine. In the tasting room at Consumer's Choice Coffee in Louisville, Ky., Lange never describes coffee as good or bad. Instead, flavors are "bright," "bold" and "robust." Coffee has "structure," "texture" and "body." As Lange, the company's vice president of business development, pours a cup, he encourages the three tasters under his tutelage to "savor the aroma, really take a good whiff. And make sure to let it roll to the back of your tongue."
One sip makes clear this isn't your father's Folgers or your mother's Maxwell House, he points out. This is the good stuff, beans from Kenya, Honduras and Columbia, roasted and blended by master manipulators of fire and flavor.
And to think that just 20 years ago it was just plain-old coffee, a mere cup of Joe, mud, java or go-go juice.
"People right now are coffee snobs," Lange said. "My parents drank Folgers all their lives, and recently when they ran out of the coffee I've been getting them, they told me, 'We had to drink Folgers today.' That's what's happening. People's tastes in coffee have changed dramatically."
Mostly because the taste of coffee has changed dramatically, according to Mike Ferguson, spokesperson for the Specialty Coffee Association of America (SCAA) in Long Beach, Calif. When a handful of major roasters ruled the American coffee market through the 1960s and '70s, not only did the quality of coffee plummet, consumption fell with it.
Increased international travel changed that, however, as Americans discovered coffee was not only different overseas, it was delicious. Slowly but surely, small roasters and independent coffeehouses dedicated to making premium coffee here sprouted and the coffee renaissance began — a consumption boom turbocharged by Starbucks.
 

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David Lange demonstrates to tasters just how much work goes into producing the perfect bean. (Photo by Fred Minnick) |
"Starbucks deserves a great deal of credit for introducing large numbers of people to the specialty coffee experience," Ferguson said. "Now there's an expectation that they're going to come across good coffee wherever they are."
Even in a fast-casual restaurant?
"We're just now starting to grab that segment of the market," he said.
Dhira Rausch believes fast casual has largely overlooked premium coffee as a component of differentiation. A coffee specialist with Specialty's Café & Bakery, a 13-unit fast-casual restaurant company in San Francisco, Rausch said while most fast-casual places serve top-quality food, their coffees often don't meet that standard.
"The whole idea of Specialty's is that it would be a great, everything-made-from-scratch bakery café," said Rausch, who joined the company more than two years ago. "We used to have really crappy coffee, freeze-dried stuff served with all these great baked goods. So I asked, 'Why don't we match the quality of our coffee with our baked goods?'"
Black beauty
America's known as the nation of red, white and blue, but its top two imports, oil and coffee, respectively, are black. And like oil, despite rising prices, coffee demand continues to soar. According to research done by SCAA and the Mintel Group, $7.76 billion worth of coffee was sold in the United States in 2000. In 2005, that number climbed to $11.05 billion. As of 2004, there were 13,900 U.S. coffee cafés averaging a solid $550,000 in annual sales.
Along with crediting Starbucks and Caribou Coffee with rapid and successful market penetration, several sources said coffee consumption has risen because of increased quality.
"I look at coffee like music on the radio," Ferguson began. "When a song you like comes on, you turn it up. When a song comes on you don't like, you turn it down. When coffee's good, we drink more, and when it's bad, we drink less."
But can't some of coffee's sales boom be tied to its trendy appeal? After all, stopping at Starbucks is cool for teens now keen on the bitter beauties of coffee. Not really, Lange said.
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Fast casuals have a chance to differentiate themselves in the marketplace with a good cup of coffee. (Photo by Fred Minnick) |
"People are realizing after all these years that it's not just brown water, it's supposed to have flavor," he said. "And once you get used to tasting good coffee, you never go back to the bad stuff."
Just as brewpubs have educated beer drinkers about richer, full-bodied brews, Ferguson said, premium coffeehouses helped coffee drinkers realize there's more to the daily grind than a freeze-dried fix.
"It's pretty hard to be awake in America for the past 10 years and think all coffee's the same," he said.
For fast-casual restaurants to get a piece of that action, they've got to put the same thought and care into their coffee as they have their food. Fast casuals already tout things like fresh-baked breads and desserts, house-made condiments and made-to-order sandwiches, but many treat coffee as an afterthought. Rausch, who calls herself "a passionate coffee freak," believes many operators don't know where to start with finding great coffee and how to prepare it.
"So many steps go into creating really good coffee, and then it can be ruined in a second if it's not brewed right," she said. "It's like microwaving filet mignon. Everybody knows not to do that, but they don't always know how to treat coffee."
Or buy it, Lange said. "You'll hear people claim, 'Our coffee is 100 percent Columbian. Well, that doesn't mean a lot, frankly, because you can use any Columbian bean — even the dust from the fields — and call your coffee '100 percent Columbian,' and it still isn't any good. But if you buy 100-percent Columbian Supremo, that's a whole different story."
Several coffee roasters said operators will even buy good coffee and then use too little of it. To achieve maximum flavor extraction, the SCAA has a "gold cup standard" that requires at least 3 ¼ to 3 ½ ounces of coffee for every 64 ounces of water. Many operators, however, use half to two-thirds of that amount to minimize costs, and the end product suffers.
Many also brew too much at one once — and sometimes at the wrong temperature — and hold it too long. Lange said a target temp of 195 F, plus or minus five degrees, is best, followed by a holding temp of 165 F to 175 F. "But after 20 minutes on the burner, it takes the road to hell," he said.
Rausch said much of her job centers on training and retraining staff at the company's stores in San Francisco, Seattle and Chicago. But it's not all about coffee making. Merchandising is essential. Just as casual- and fine-dining restaurants feature a rotating list of special wines, Specialty's features unique coffees from around the world, and staffers are trained to tell the story behind each type.
Doug Zell, founder and chief executive of Intelligentsia Coffee Roasters in Chicago, said a growing number of his clients are requesting "single-origin coffees" as part of their premium offerings.
Customers "want to know more about where the coffee is coming from," he said. "So (operators) are buying specific coffees from Peru or Rawanda or Honduras and rotating them seasonally."
The mistake many restaurants make, he added, is simply selling "coffee," something they'd never do with wine. "It's sort of like if you went into a restaurant and they just had Chili's White Wine. Would that that be as interesting to you as hearing this month's featured bottle is a Chilean wine from the Mendoza Valley?"
As you might expect, such uniqueness costs more. Rausch said truly premium coffee costs about double what many fast-casual operators are paying. "Ours usually costs between six and seven dollars a pound, and sometimes as high as $8. Many wholesale coffees are closer to $4."
But as coffee drinkers continue to demonstrate, price isn't the issue, it's quality, even when times are tough.So raising coffee prices a dime to a quarter likely won't be a deterrent.
You'll hear people claim, 'Our coffee is 100 percent Columbian. Well, that doesn't mean a lot, frankly.
-- David Lange Consumers Choice VP |
"Our research shows coffee is an elastic product, in that as incomes go up or down, people drink the same amount of coffee they always did," Ferguson said. "Even after 9/11, we checked with our members to see if sales were dropping off, but everyone reported breaking sales records. People were all hiring, and yet they couldn't keep up with demand. That hasn't changed at all."
This article originally appeared in Fast Casual Magazine.