The Triple Bottom Line and the Coffee-Buying Conundrum

Coffee buying is interesting for many reasons. It’s complicated, macro-economically important, ethnographically rich, and adventurous. Sadly, often as far as “speciality Roasters” are concerned it’s also extremely exotified, mostly taking place on Instagram accompanied by claims of altruism, expertise, with a fair dose of naïve ideology. This is all in stark contrast to coffee trading, where buying requires transferable skillsets (I’m sorry to tell you, having an opinion on how coffee tastes sadly doesn’t qualify as a legitimate skill in 99% of cases). 

I’m being cynical on purpose here. Conversations with others in the industry reveal shared opinions attesting to this perspective, and I can relate to all the nativity, ideology and inescapable elitism surrounding the industry at large. No doubt I have likely been both part of the problem and hopefully more often than not a part of the solution.

SO, WHAT PROBLEM ARE WE TRYING TO SOLVE?

For the industry, it’s “Get more people to care more about coffee”. For coffee buyers, however, there seems to be a unique set of challenges confronting this question – here’s why. For the longest time it’s been the mechanism of buying coffee that drives the ethical proposition for the industry at large – “if I’m buying coffee at a premium, I’m by default a part of the solution”. In most cases - within the smaller independent businesses on which our industry is built - the job of procuring coffee is a core function of a founder, and one that provides a means for expressing one’s sense of the triple bottom line. (How successful the coffee company becomes determines whether the supply chains are successful, not the other way around). What eventually sprung out of this approach came a race to stake claim to the most “ethical” supply chains using exclusivity, inverse price wars, and obtuse language to differentiate from the rest. Increasingly, coordination within the supply chain itself became secondary to how it was perceived.

Ana Luiza Pellicer of Mió Fazenda with Nick Mabey

I have said this before and I’ll say it again, specialty is just one of many emergent features of deregulated low-market pricing conditions, and if there’s any lesson we’ve learned by now it’s that it’s insufficient to claim to be a part of a solution when the problem isn’t collectively understood. If this were the case, talking about “ethical claims” would be all that’s required, backed by transparency yet, more often than not, those less vocal about the impact they claim is delivered through their purchasing decisions, demonstrate true value creation via focusing on building strong brands that connect with new and curious customers ergo: a successful brand.

So, to this end, the most succinct way I can describe the problem coffee buyers are trying to solve for is; 

The effective coordination of stakeholders to create value and not externalise harm.

Stakeholder is a key word here and involves supply chain actors including not just the coffee growers, exporters roasters et al., but the consumers and the roastery brands whose responsibility it is to incentivise consumers to care about their brand, their products, and their “Ethics”. Externalising harm for a roaster could be buying irresponsibly and sinking profit margins, conversely not paying attention to producer goals and undervaluing coffee. The key here is to create and build demand for coffee that captures value creation beyond a quality spectrum, for all stakeholders. If you take this approach, the equation becomes increasingly multi-dimensional.

As far as solving the coordination problem goes, what has this all got to do with Brazil?

In some producing countries, showing up and buying can certainly go a long way (I was recently in the Congo, the power of purchasing there is staggering, producers there are simply that vulnerable) – however, you must have a strong brand and pedigree to justify premiums where the perceived value doesn’t yet exist. This example is one of the counterfactual approaches to coffee buying - what would happen to the fortunes of coffee growers if I didn’t buy? In all cases you have to be in for the long run, and, in all cases, you have to also accept that it quite simply may not work.

In Brazil’s case, the objectives are much different. Here, Brazil presents the best opportunity to innovate agricultural practices away from mono-crop systems and into truly sustainable farming systems. Why? The economic realities of producing at scale and relatively low production costs mean profitable farming models exist, but also, and just as importantly, the research capacity for coffee within the private and state sectors across the country are immense. 

With this infrastructure in place, one can increase reinvestment rates into value-adding initiatives. In my position as a coffee buyer responsible for 400 tonnes of green coffee a year, two-thirds of this is from Brazil. For reference, this is not by any means huge nor by most means small. The way I look at it is, big enough to be able to adequately use buying power as a form of impact investment, and small enough not to need a legal team. 

With this buying power, we aim to empower supply chains in which all participants are adequately resourced. That is, where the success of one participant is not dependent on one or two additional stakeholders, nor relying purely on commercial activity, but instead can capture and implement different means of value creation.

The Sombra Project represents such a supply chain.

The actors here are the two brands I’m responsible for (Volcano Coffee Works and Assembly), Fazenda Mio, a family-owned and operated coffee farm, and professors at the Brazilian state research institution. It’s designed to create a demonstrable agroforestry system for coffee that fosters biodiversity, increases long-term economic outcomes, and reframes coffee farming systems as we know them in Brazil.

My relationship with Mio began in the summer of 2020, after a mutual friend and colleague had arranged a meeting between myself in Ana (Mio’s acting MD). I planned to seek advice on how to build a Mio brand in the UK. At this point, I was passively seeking a long-term business partner in Brazil, someone who could breathe life into our ambitions to integrate programmes directly into supply-chain activity. Fast forward 4 years and, as all meaningful business relationships surely become, what we found in one and other was something transcendent of self-interest yet completely self-serving to our collective goals.

Sombra is funded entirely through voluntary premiums on every pound of coffee bought from Mio. There is absolutely nothing innovative about this model, however, what’s innovative is the ambition, scope, and collective acknowledgement of stakeholder responsibilities.

Nick with Dr. Lucas Louzada in the new coffee fields at Mió Fazenda

Implementation of Sombra involves an initial 5-year project to take 15 hectares of unproductive low-lying (frost-prone) land to cultivate an integrated agroforestry system, using 4 Arabica varieties, 4 native shade trees, macadamia for production and grass species for bio-diversity. All of these are systematically plotted and planted to provide data for species selection and proximity for optimal cherry yields, and quality (all of which will be a function of soil bio-diversity not altitude – a groundbreaking finding from Professor Lucas Louzada leading the research and design element of Sombra).

At time of writing, we’re in year 2 of Sombra, with production of coffee looking to commence 2026/27. We will be providing full transparency of findings throughout and beyond the projects initial duration with ambitions to implement the system over the entirety of the rest of Mio’s productive land, a feat that at current timelines would take 100 years to complete. Hopefully, such long-term ambitions will go some way to incentivising broader longer-term decision-making into other supply chain projects, and that Sombra can demonstrate real value-creation mechanisms as proof.