# Pricing of coffee....



## Adam I (Jul 28, 2020)

Morning guys and gals,

I got a question about pricing of coffee ( more hypothetical than anything) but here goes......

when you sell coffee to a retailer ( coffee shop or retail shop) what kind of Mark up do they expect to make on the coffee you sell them? For example if you sell them a bag of 227g coffee for £3 what would they expect to be able to sell that on for? Again, what kind of price would a coffee shop expect to pay on a 1kg bag of coffee

I appreciate the vagueness of my questions it's just been running through my head recently. As I've no idea of the running of retail or cafes.

thanks

Adam


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## DavecUK (Aug 6, 2013)

The answer is it depends:



On the shop


What they sell a coffee for


The coffee itself


227g is an odd w eight, normally bags are sold as 250g or 500g (in my case about 430 ish grams as I split a 1 kg roast in half). Often roasters use odd weights to make price comparisons a little more difficult.

They could pay anything from £8-10 kg for very cheap coffee, to £30+ kg for good coffee. The mark up on coffee reduces with price e.g. a coffee costing less than £3 kg in the green might sell with a 400%+ markup..a coffee costing £10 kg in the green, won't sustain that sort of markup. A large roaster, roasting 120 kg batches at a time can afford to make a much smaller margin on cheaper coffee, a small roaster can't.

A roaster roasting 4000kg of coffee per week has a different cost model to one roasting 100kg per week. e.g. if the first roaster buys coffee at 10 kg green, that's a stock investment of 400K per 10 weeks supply, for a small roaster that reduces to 10K. Clearly the larger roasting operations have little incentive for huge stockholdings of expensive coffee, of course they may have smaller amounts and roast those in smaller roasters rather than the 2 or 3 bag roasters.

All of these considerations affect what is paid for the coffee....not even counting the expertise of the roaster, quality of packaging, robustness of supply and consistency requirements.

The coffee shops/retailers markup also depends on many things, marketing, packaging, ambience, reputation etcc


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## Beeroclock (Aug 10, 2015)

I'm seeing the 227g bag from a number of roasters now, perhaps it depends on individual roasters batch sizes and how they divi it up. More likely it's a way of increasing the return but maintaining the same "bag" price.


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## DavecUK (Aug 6, 2013)

Beeroclock said:


> I'm seeing the 227g bag from a number of roasters now, perhaps it depends on individual roasters batch sizes and how they divi it up. More likely it's a way of increasing the return but maintaining the same "bag" price.


 It's a bit of an Irritation because they use a bag that can hold 250g or more and only put 227g in it.


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## MediumRoastSteam (Jul 7, 2015)

DavecUK said:


> It's a bit of an Irritation because they use a bag that can hold 250g or more and only put 227g in it.


 It's the imperial system. 8oz, 1/2 pound = 227g (226.796g according to Google).

Now that we left the EU - I'm not joking either, it's a genuine thought, as it might be a marketing thing - imperial measures might come back in vogue? With the rhetoric of the past two years, this won't surprise me at all.


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## Mrboots2u (May 10, 2013)

MediumRoastSteam said:


> It's the imperial system. 8oz, 1/2 pound = 227g (226.796g according to Google).
> 
> Now that we left the EU - I'm not joking either, it's a genuine thought, as it might be a marketing thing - imperial measures might come back in vogue? With the rhetoric of the past two years, this won't surprise me at all.


 Jesus....

Let's go back to pounds , shilling and pence, the gold standard and rickets for everyone


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## Adam I (Jul 28, 2020)

Thanks for the replies..... 227g is the weight is suggested as I mainly see coffee sold at that weight ( in supermarkets and coffee shops) I've since read that it's apparently to do with historical reasons ( Half a pound = 227g)

im not at the stage of selling coffee or anything close to that kind of scale. It was more just a thought!

thanks again

adam


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## MediumRoastSteam (Jul 7, 2015)

Mrboots2u said:


> Jesus....
> 
> Let's go back to pounds , shilling and pence, the gold standard and rickets for everyone


 On somewhat very unrelated stuff... but still on the imperial vs metric and historic reasons topic, it's interesting that most portafilter spouts are still 3/8" bsp threads, even though it's an Italian design.

and on the 227g vs 250g... what are your thoughts?


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## rogher (Nov 22, 2020)

I fancy it's deliberate deception.

Same when I'm travelling and buy a 2pt carton of milk, only to discover that it's only 1ltr yet the same price...


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## MWJB (Feb 28, 2012)

rogher said:


> I fancy it's deliberate deception.
> 
> Same when I'm travelling and buy a 2pt carton of milk, only to discover that it's only 1ltr yet the same price...


 Not a very good deception as the weight is declared.

Not seen a 227g bag in yonks, plenty of 200g, 250g, 350g though.


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## Rob1 (Apr 9, 2015)

I'm just looking forward to the crowning of the King/Queen of the North and for the borders of Northumbria to be reinstated.


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## Mrboots2u (May 10, 2013)

MediumRoastSteam said:


> On somewhat very unrelated stuff... but still on the imperial vs metric and historic reasons topic, it's interesting that most portafilter spouts are still 3/8" bsp threads, even though it's an Italian design.
> 
> and on the 227g vs 250g... what are your thoughts?


 Something has to give , exchange rate , drop off in wholesale to cafes, previous years pension and wages rises .

People would complain if prices when up and complain when sizes decrease


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## DavecUK (Aug 6, 2013)

MWJB said:


> Not a very good deception as the weight is declared.
> 
> Not seen a 227g bag in yonks, plenty of 200g, 250g, 350g though.


 As it is on Biscuits, chocolate bars, Toblerones with half the peaks missing, those packs of 200g butters that length and width are exactly the same as their 250g counterparts, even bags of sweets craftily made less heavy but the same size. They rely on the consumer looking at the packet, not the weight of product inside it. Making numbers "difficult" prevents people calculating a price per 100g.

Tissues, for my mum (constantly have to do mental math to work out the best value) and those lint rollers for cat hairs...wow huge difference in length of sheets for the same price and massive obfuscation on price per metre.


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## GlenW (Sep 7, 2013)

If you're interested in understanding a bit about the economics of coffee shops (or about how to run a coffee shop generally) - I thoroughly recommend reading What I Know About Running Coffee Shops https://shop.3fe.com/product/wikarcs


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## earthflattener (Jul 27, 2015)

MediumRoastSteam said:


> On somewhat very unrelated stuff... but still on the imperial vs metric and historic reasons topic, it's interesting that most portafilter spouts are still 3/8" bsp threads, even though it's an Italian design.
> 
> and on the 227g vs 250g... what are your thoughts?


 I was lucky in not meeting a real engineer with their bonkers systems of units until I was about 30 

Probably the weirdest one I've met is that Oil&Gas reservoirs in the UK Continental Shelf are m^2ft. That is, x and y direction are measured in meters, but depth is in feet. Probably the best analogue for our half hearted membership of the EU that there is. The knock on effect is that all the constants used for calculation, such as Darcy for fluid flow have to change depending on where you are in the world. (The US uses ft^3 and the rest of the world m^3).


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## Adam I (Jul 28, 2020)

GlenW said:


> If you're interested in understanding a bit about the economics of coffee shops (or about how to run a coffee shop generally) - I thoroughly recommend reading What I Know About Running Coffee Shops https://shop.3fe.com/product/wikarcs


 Thanks I'll have a read!

lots of interesting points, for what its worth I had a look today in Waitrose and most (not all) of the regular sized bags appeared to be 227g.


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## MWJB (Feb 28, 2012)

Adam I said:


> Thanks I'll have a read!
> 
> lots of interesting points, for what its worth I had a look today in Waitrose and most (not all) of the regular sized bags appeared to be 227g.


 Simplest way to look at it, for cost comparison, is 227g is near enough 10% less than 250g. Difference in actual weight/price per brand will create so much noise that the tiny difference in weight/% won't be meaningful.

All the higher quality bags (Roastworks, Union, Three Sixty) come in 200g.


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## Agentb (Feb 11, 2017)

DavecUK said:


> 227g is an odd w eight, normally bags are sold as 250g or 500g (in my case about 430 ish grams as I split a 1 kg roast in half).


 It is, i can't remember seeing one, maybe they are splitting their "1kg" roast into 4?


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## profesor_historia (Sep 1, 2020)

MediumRoastSteam said:


> It's the imperial system. 8oz, 1/2 pound = 227g (226.796g according to Google).
> Now that we left the EU - I'm not joking either, it's a genuine thought, as it might be a marketing thing - imperial measures might come back in vogue? With the rhetoric of the past two years, this won't surprise me at all.


There is a very valued roaster in Spain, D'Origen, who sells 340gr bags, the prices are very competitive.

Sent from my ALP-L09 using Tapatalk


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## rogher (Nov 22, 2020)

I'm pretty sure that, should you be tempted to look in a supermarket, you'll find 277g bags there.


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## Guy Levine (Aug 20, 2019)

I can add something here. I sell online and roast on an aillio bullet (just upgrading!) I can roast 850g comfortably. With loss of weight due to roast I can just about get 3x225g bags out with one batch.

I wonder if you are seeing a lot more smaller roasters in the market?


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## Rhys (Dec 21, 2014)

DavecUK said:


> As it is on Biscuits, chocolate bars, Toblerones with half the peaks missing, those packs of 200g butters that length and width are exactly the same as their 250g counterparts, even bags of sweets craftily made less heavy but the same size. They rely on the consumer looking at the packet, not the weight of product inside it. Making numbers "difficult" prevents people calculating a price per 100g.
> 
> Tissues, for my mum (constantly have to do mental math to work out the best value) and those lint rollers for cat hairs...wow huge difference in length of sheets for the same price and massive obfuscation on price per metre.


 Probably why people are stockpiling toilet paper.. They'll change metres back into yards but keep the same number. 10m metres say, and then change to 10 yards.. losing 30", that's nearly 3 feet.. :classic_rolleyes:


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## DavecUK (Aug 6, 2013)

Rhys said:


> Probably why people are stockpiling toilet paper.. They'll change metres back into yards but keep the same number. 10m metres say, and then change to 10 yards.. losing 30", that's nearly 3 feet.. :classic_rolleyes:


 The problem is the size of the average UK arse is now 1 metre, or 3" bigger and why we need more toilet paper than any human has a right to use in a month. All part of the evil toilet paper manufacturers plan, working in conjunction with the food industry.


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## Rhys (Dec 21, 2014)

DavecUK said:


> The problem is the size of the average UK arse is now 1 metre, or 3" bigger and why we need more toilet paper than any human has a right to use in a month. All part of the evil toilet paper manufacturers plan, working in conjunction with the food industry.


 Well, that's just a bum deal...

Thing is, are they measuring mens or womens arses?

Men buy toilet roll as and when they need it. 1 roll lasting into 2 weeks or more is the norm hence why you can get packs of 2 rolls. The second roll might be squirrelled into the garage to mop up oil spills. Women on the other hand after going for a pee, and wiping their nose will have used half a roll in the process. I know from experience that when my other half is here the toilet roll always looks new on the holder, but the multi-pack she'd bought is diminishing.. they wrap the bloody stuff round their hand like bandaging an amputee victim.. :classic_rolleyes: :classic_biggrin:


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## DavecUK (Aug 6, 2013)

@Rhys I thought I was sailing close to the wind talking about the increasing buttock size of the UK population....

I actually blame in the rise of online mummification classes...just look at the description...

https://outschool.com/classes/lets-get-mummified-cCFQK6U0


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## Rhys (Dec 21, 2014)

DavecUK said:


> @Rhys I thought I was sailing close to the wind talking about the increasing buttock size of the UK population....
> 
> I actually blame in the rise of online mummification classes...just look at the description...
> 
> https://outschool.com/classes/lets-get-mummified-cCFQK6U0


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## DavecUK (Aug 6, 2013)

from this.....










to this.... ????


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