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Price Rises

edited January 1970 in www.beangreen.com.au
I could have sent an email to Brendon but I think our members here deserve to know what and why is going on.
I have enjoyed buying beans from Beangreen for some time now and have roasted great coffee using great products and would like to like to stay as a loyal customer.
However,  going from $50 to $75 and then to $150 minimum spend for free freight is one concern, the other is the two stage price rises also for some of the green bean offerings.
Understandably the freight charges went up and the world prices for beans likewise.
Only seems like yesterday I was paying $13.00 a kg for Colombian Hacienda but I had no choice but to order the 30 kg starter pack a while ago since I am roasting for friends and the restaurant. Today we are paying $17 for the same Colombian.
Perhaps Brendan can shed some light.

Comments

  • on 1434292142:
    I could have sent an email to Brendon but I think our members here deserve to know what and why is going on. I have enjoyed buying beans from Beangreen for some time now and have roasted great coffee using great products and would like to like to stay as a loyal customer. However,  going from $50 to $75 and then to $150 minimum spend for free freight is one concern, the other is the two stage price rises also for some of the green bean offerings. Understandably the freight charges went up and the world prices for beans likewise. Only seems like yesterday I was paying $13.00 a kg for Colombian Hacienda but I had no choice but to order the 30 kg starter pack a while ago since I am roasting for friends and the restaurant. Today we are paying $17 for the same Colombian. Perhaps Brendan can shed some light.
    I agree with your observations Gary. I placed a few orders with Bean Green between 2011 and 2013, however when the freight free purchase went from $50 to $75 I made a mental note, then when prices went up by about 30%, I sat up and took notice, the straw that broke the camels back was when the freight free level went to $150. I switched back to my previous on line supplier (the other Aussie online forum) price levels are still what they were 4 or 5 years ago, most 'Arabica beans are around the $13kg mark with some as low as $9 and a couple of specialty coffee's much higher. I cant justify paying substantially more for a product I found to be of similar quality.
  • $150 is a bit much for an order for my own use.  Might have to pick up my orders from now on.
  • on 1434329430:
    I agree with your observations Gary. I placed a few orders with Bean Green between 2011 and 2013, however when the freight free purchase went from $50 to $75 I made a mental note, then when prices went up by about 30%, I sat up and took notice, the straw that broke the camels back was when the freight free level went to $150. I switched back to my previous on line supplier (the other Aussie online forum) price levels are still what they were 4 or 5 years ago, most 'Arabica beans are around the $13kg mark with some as low as $9 and a couple of specialty coffee's much higher. I cant justify paying substantially more for a product I found to be of similar quality.
    Not to mention 50 cents a kg goes to faircrack projects, a great cause for primary producers. I really want to support small operators, which may be wine producers or independent butchers for true value for money coming from advice and great service. I can only presume the other forum are able to keep margins smaller due to the higher turnover, support of sponsors and sales of other goods. I may have to rely on the local roaster for greens...
  • agreed as well hopefully we'd be able to hear some clarification from brendan
  • most likely a higher turnover, where amongst other things the higher turnover leaves room for the vendor to negotiate a better price on the freight it COSTS THE VENDOR to send the goods out. I can fully understand how small purchases strain the friendship in regard to "free freight", which is really "freight cost coming out of my profit margin". If someone buys say $45.00 of beans but the freight (depending on what type of freight but lets say for the sake of the example a 3kg Express Post satchel) costs $13.00, then there there was no point in making the sale....may as well sit and read the newspaper... Somewhere in there, there lies a happy medium where an operator can make a usable profit and below which it isnt worth making the sale...
  • It's certainly not my place to comment on another business - but I will add the following because it needs to be said....... A. Price of quality raw coffee has risen considerably in the last 18 months. Up to 50%. This is now starting to flow through the market. It's also likely to go higher. B. Some vendors may have stocks that are 2014 crop and therefore able to offer them up at a lower price point - so comparisons are not entirely easy nor fair. C. Anyone expecting free freight in Australia is just kidding themselves - it's only sellers who enjoy +50 - 80 % margins on their products who can afford such "incentives". The term incentive is correct. The concept of free freight in Australia is a mindset driven by 3 dynamics. 1. eBay became greedy and forced all sellers to build in the cost of postage so they could apply valuation charges on the entire sale price inclusive of postage. This was a trend started 6 years ago and they forced the market to play the game by altering their Best Match ranking criteria. Whilst people may think eBay is not a market driver.......in the past it has been and there is a "network effect" caused by it's strategies. 2. The Australian consumer is accustomed to convenience shopping - where everything is abundantly available at all times. Previously it was the corner store, then the supermarkets killed them and pushed that into the petrol stations. Yet supermarkets control and govern your choice and the price you pay. Freight is expensive because it's now very difficult to deliver items to the end customer. Congested roads. Nobody to sign for the parcel, etc. 3. Drop shipping has become an industry that is eroding the Australian retailer and the economy. So many companies now warehouse offshore and enjoy a special rate of freight "interchange" that is not available to domestic merchants - regardless of the bulk or leverage. This means overseas-based companies take sales and offer free freight because their actual cost base, including freight, is lower. Result = no jobs in Australia and no inflows into the Treasurer's kitty and a decline in the services infrastructure like health, education, roads, etc. Residential freight services in Australia are a sub-standard, expensive monopoly which is a situation that is not going to change any time soon.
  • Would like to say thanks to Fresh Coffee and Mycuppa, our stalwarts of the industry for their insight and perspective on this topic. You could have spent your time elsewhere but your passion for the coffee industry and community shines through. Appreciated. Bean prices have always been on the rise since consumption in around the world has increased as well as below average growing conditions resulting from global warming. There,s no escape from the fact we are paying $20 a kg for a Brazilian or Colombian base bean greens...which is the tipping edge to go back to CS for some of us. Will endeavor to support a variety of providors, here and elsewhere. Just a pity though there wasn,t much of forum interaction here from the man himself. I got a lot more service from my local independent butcher, cafe and baker.
  • on 1434845257:
    Will endeavor to support a variety of providors, here and elsewhere. Just a pity though there wasn,t much of forum interaction here from the man himself. I got a lot more service from my local independent butcher, cafe and baker.
    As will I Gary, however, as you say, it's a two way street, not sure just how important to him the business he generates on this forum is, pretty insignificant I suspect, regardless things can change, pays to look to the future. :)
  • Just throwing my 2c in. Who knows .. other than Brendan himself, why he has raised the bar so much higher for the 'free delivery' bonus. In a climate of rising coffee prices .. he may have opted to do away with the lower end freebie in order to absorb some of the cost rises on beans to his customers. Seems to me that Brendon now has 2nd thoughts about offering free delivery unless the order is more substantial ---> Captain obvious. lol On a $50 purchase .. free delivery is like a 20% discount if the cost of postage is $10. Going up to $150 is an obvious sign to me that it is no longer sustainable to offer free delivery on relatively small orders. Besides, being green beans, and their long storage life ... Brendon may have decided, rather than scrapping the incentive altogether .. make a bigger purchase so that both he .. and his customer can come out with a win. My guess is that it is to be able to limit price increases on the greens now and into the near future. We all love a freebie ... but postage cost is something we buyers should accept ... otherwise, was it Brett? go pick them up  :thumb: Maybe a mod or Admin could give Brendon a nudge & a wink, being a forum sponsor .. and fill us in on the reality of coffee trading in these times. I'd guess .. Brendon has a pretty fair reason for doing what he's doing. Was that 2 or 4c worth?  ::)  >:D ps. Always interesting to get some insight from mycuppa Maybe the freebies were a gift from the Heavens .. and we've bean pampered with generosity that had to end sooner or later. At the end of the day .. it may have cost us a little more ... but we still get to have our superb :coffee2: <---- Priority No1  - @ a good price <-- No2
  • on 1434343850:
    C. Anyone expecting free freight in Australia is just kidding themselves -
    Agree. I just did some research into a recently googled supplier located In Sydney; won't disclose the name, but suffice to say they advertise "fee" shipping on every product, green, brown, syrups, etc! BUT, and this is the cruncher. Their green bean list shows the Limu at $15.90. When you select it, the next page shows the 15.90 is for 500g, @9.90 for 1.5kg and 41.90 for 2.5kg. All with ''free shipping''. I did a comparison on their Ethiopian Limu against CS, as an example. CS is at $12/kg and an order of 2- 5kg bags ($60) + $19.20 postage cost me $79.20.  against the so-called "Free Shipping" from Sydney of 2- 5kg for $83.60. So I'd be paying $4.60 more for a product free shipped 2 hours north of Sydney to avoid paying $19.20 postage from Melbourne :question: :question: Everything comes at a cost folks. Marketing is out their to catch us out. As mycuppa says; "Yet supermarkets control and govern your choice and the price you pay." You only need to look at Woolies, Coles and the likes' brochures, to see this.
  • Free shipping is a marketing strategy. Everyone knows it is usually included in the price. You see it on eBay .. this price with cheaper postage .. or a higher price with cheaper postage. The funny ones are those selling an item worth $400 .. and putting it up for $2,500. It's throwing out a line with a hook & bait .. hoping to catch a dill .. cause they know there are a few fish out there that will gobble up anything. I was in the Supermarket. An elderly Woman asks her husband. Should we get the larger (2kg) sugar .. or the smaller one? (1kg) She just took the smaller sugar for $1.60 .. saying look, it's on special, and happily walked off thinking she got a good deal. I looked on the shelf below it .. and there was the same brand - 2kg for $1.80 .. which was the one I took.  :rofl: People get fooled by marketing. As Kevo pointed out .. free delivery doesn't mean you're getting a better deal. *I suspect that in Brendon's case .. it was a genuine great deal .. but couldn't offer it indefinitely.
  • An important point lost on many folks is the price for 2014 crop versus 2015 crop coffees and whether a given supplier uses spot price (replacement) factoring or a cost-landed+margin approach. We are in the middle of 2015 yet there is still a fair bit of 2014 crop raw coffee on offer. The precise dates are a bit ambiguous anyway given producers hold inventories at origin for many months, e.g. quite often referring to 2015 crop as actually 2014/2015, etc. Of course, you have origins like Colombia where the coffee can be sourced for most of the entire calendar due to different crop cycles in the various departments. There can be a 20 - 30% price difference (or more) between 2014/2015 crop that arrived in December 2014 versus something that landed in June 2015. It may also not be easy to compare one offer from the other as the flow-on effect of rising prices can take up to 9 months to pass through the entire chain. Similarly, one seller may deem supply of raw coffees as a negligible margin business across their portfolio, e.g. they want their raw coffee offer to persist in investment mode (cheap with low returns) in order to remain competitive for other reasons such as increasing membership levels, reputation, or improving scale to feed another part of their business that is higher margin, etc. Another assumption people should also consider is that Brazil and Colombia are not cheap origins for specialty coffee. In fact, there is really no such origin at the moment that can be regarded as "cheap" when it comes to quality lots - everything looks expensive when compared to 18 months ago and when I talk with my brokers every week, the #1 frustration for them is that the majority of people purchasing raw coffee in Australia persist with a mindset unable to shift 2 years old pricing as the reference point. Those days are unlikely to return unless the rest of the world reduces it's demand for quality lots. There are spectacular coffees shipping from both Brazil and Colombia that are priced for quality just as high as Africans and Sumatrans - which by the way remain in supply deficit for the 3rd year running.
  • Di-bella is also offering green beans with free shipping on orders over $50 , not sure of the quality of the greens though.
  • Hi there. I understand what you are saying however I think the choice of word is somethig other than"quality". Eg an "FAQ" A grade coffee of whatever origin is going to be a good "quality" coffee and of course it depends on what anyone is going to do with it including blending to make a nice cuppa out of it one way or another.... However a Cup of Excellence scorer is of course also a "quality" coffee but is likely to cost a lot more.... Its more about the simple cost of the individual offering than anything else. Example. During my recent sojourn into 3rd world areas I made contact with some very remote farmers with some very exclusive (read tiny production) and genuine Cup of Excellence scoring product. By the time it gets here, it will probably cost me somewhere in the vicinity of  $40.00 per kg. green. Its only a small and probably extreme example, but shows how profitability can be rubbery when you are trying to make an income from selling beans. As stated by mycuppa above (but in a different way), the selling price of greens and whether that does or doesnt include "free!"freight, will depend on how anyone justifies the sale of green beans within their overall business model and what they are trying to achieve by doing it. That is stuff that retail clients arent privvy to. 
  • Wow, Mycuppa and Fresh Coffee have answered this on so many levels. Fact is, Bean Green sell their product too cheaply. Hopefully Brendan does enough turnover, as his margins are small. To someone with a background in business the various models on offer are blatantly obvious, and so are the margins. If BG buys a bean for say $10.67kg, landed in his warehouse, then it looks like he puts 50% margin on top. So that means he sells it at $16/kg. If you buy 10kg you get $1/kg discount, if you buy 30kg the discount is $3/kg. So, how much is he making? On the 10kg purchase ($150 total) he gives free postage. Worth at least $20. He has to bag the beans and put them in a box, which is not free. So add $5, just to be safe. Profit on the $150 is $43, minus postage and packaging. Leaves $18 Gross Profit. From this he has to pay rent, insurances, and a whole swag of other costs. Make your own conclusion from this. Coffee has increased in price. So has freight. BG sell good quality beans at a very reasonable price. So does MG. As to CS, I do not care how cheap their product is, but apart from 2 or 3 lines, the rest are mediocre and you get what you pay for. I have bought and roasted most of the beans on offer at CS, and do not rate them as highly as all of the CS fanclub seem to. I am not the only one who shares this view, but others are way more diplomatic and keep their mouths shut. Maybe my palate is different to others, but I am highly critical of my roasting skills, and of professional roasters. My time is valuable, and I do not want to waste it, roasting cheap beans. I have bought high quality beans, roasted them with different profiles, and had great results each time. The same can not be said of mediocre beans. I know many people who have bought CS beans, disliked them and then struggled to use them up in blends. People are free to buy where they choose and everyone has a budget. I did not like the original CS model of selling beans, and was very glad when I discovered BG and MG years ago. Today the choice is even greater. Basically you get what you pay for. Every now and then you may come across a great bean at a "cheap" price, but that is becoming rare. As Alan Frew wisely said in one of his newsletters, the biggest difference in the cup comes from the processing methods at Origin. Wasting thousands of dollars on high end espresso machines and commercial conical grinders is stupid if you are going to roast crap beans. If you have invested in top notch equipment, and roasters, why are people so stingy when it comes to buying quality beans? As to the OP, the cost of doing business in Australia is huge. No doubt you are feeling it too. The coffee market here is over saturated in the same way so many other businesses are. Too many shops, not enough people.
  • Who or what is MG?
    on 1434874628:
    Wow, Mycuppa and Fresh Coffee have answered this on so many levels. Fact is, Bean Green sell their product too cheaply. Hopefully Brendan does enough turnover, as his margins are small. To someone with a background in business the various models on offer are blatantly obvious, and so are the margins. If BG buys a bean for say $10.67kg, landed in his warehouse, then it looks like he puts 50% margin on top. So that means he sells it at $16/kg. If you buy 10kg you get $1/kg discount, if you buy 30kg the discount is $3/kg. So, how much is he making? On the 10kg purchase ($150 total) he gives free postage. Worth at least $20. He has to bag the beans and put them in a box, which is not free. So add $5, just to be safe. Profit on the $150 is $43, minus postage and packaging. Leaves $18 Gross Profit. From this he has to pay rent, insurances, and a whole swag of other costs. Make your own conclusion from this. Coffee has increased in price. So has freight. BG sell good quality beans at a very reasonable price. So does MG. As to CS, I do not care how cheap their product is, but apart from 2 or 3 lines, the rest are mediocre and you get what you pay for. I have bought and roasted most of the beans on offer at CS, and do not rate them as highly as all of the CS fanclub seem to. I am not the only one who shares this view, but others are way more diplomatic and keep their mouths shut. Maybe my palate is different to others, but I am highly critical of my roasting skills, and of professional roasters. My time is valuable, and I do not want to waste it, roasting cheap beans. I have bought high quality beans, roasted them with different profiles, and had great results each time. The same can not be said of mediocre beans. I know many people who have bought CS beans, disliked them and then struggled to use them up in blends. People are free to buy where they choose and everyone has a budget. I did not like the original CS model of selling beans, and was very glad when I discovered BG and MG years ago. Today the choice is even greater. Basically you get what you pay for. Every now and then you may come across a great bean at a "cheap" price, but that is becoming rare. As Alan Frew wisely said in one of his newsletters, the biggest difference in the cup comes from the processing methods at Origin. Wasting thousands of dollars on high end espresso machines and commercial conical grinders is stupid if you are going to roast crap beans. If you have invested in top notch equipment, and roasters, why are people so stingy when it comes to buying quality beans? As to the OP, the cost of doing business in Australia is huge. No doubt you are feeling it too. The coffee market here is over saturated in the same way so many other businesses are. Too many shops, not enough people.
  • on 1434878998:
    Who or what is MG?
    MoG; Ministry of Grounds, a site sponsor in NSW (Blue Mountains). Great to deal with and nice greens and browns.
  • Of course! Blonde moment........ thanks!!
    on 1434879262:
    MoG; Ministry of Grounds, a site sponsor in NSW (Blue Mountains). Great to deal with and nice greens and browns.
  • on 1434879338:
    Of course! Blonde moment........ thanks!!
    We all have them mate.  :coffee2: Thanks to Fresh Coffee and mycuppa for their valued input on this subject. @Lwowiak: my references in using CS earlier was in an attempt to show how the "free shipping" marketing tag can mislead consumers. As a clarification, the costs I used were for a bean of similar origin and type, not necessarily a same crop and done in a generalised manner and not meant in any way as an endorsement of CS prices or quality. It was the first place I found another Ethiopian Limu. I agree with all else you have said, especially that people are free to buy where and what they choose according to budget and tastes. :thumb: I started out getting my roaster from MoG and my greens from MoG and CS, perhaps like several other home roasters here. It's been a long time since my last CS purchase, buying from MoG, BG and the odd supply from a local roaster, has me well stocked. We ARE very fortunate as home roasters to have these choices. So  :coffee2:
  • Wow... So much information here on offer.  Thanks guys for the excellent posts.  Lwowiakl, I agree with you and couldn't have said it as well or as diplomatically as you!
  • I just ordered 5kg of green Costa Rica Tarrazu @ $14/kilo from Brendan, and the postage was only $10 delivered by a Courier. $80 all up - Thought that was a good deal.. for some pretty tasty beans. A dark roast in my little popper does it for me.  :thumb: Cranking out the 9.3/10s these days .. which is better than good. Larfin  8)
  • Nice work Moony.  When you think think 4+ kg of wonderfully fresh roasted coffee for 20/kg it puts it all in perspective!
  • The best coffees I've had .. have been from Jonty and KK, who sent me some of their home-roasted beans, which were dark, especially Jontys. Apparently Dark roast doesn't seem to be available from the usual suppliers. The benefit of home-roasting is that you can do them to suit your own personal taste .. which usually beats buying a coffee in a Cafe .. as they have no idea how you like it. Buying greens and roasting them yourself .. is amazing value. Cheers for the heads-up in getting back to home-roasting. Brett.  :thumb: I included a nice note to Brendon
  • Very interesting read so far, imho grean beans that are in the $14 to $22 ish dollar range per kilo are mid range quality at a cheap price that can bring great results in the cup, perfect for the home roaster I would think. If you consider the in the cup price it all seems a very reasonable offering.  Lets look at a bean that is $17 per kilo, we pay $10 postage to our door, we then roast the bean for $2 of electricity (yes it's more for us with larger gas roasters but we can do bigger batches so all works out) we loose 15% mass through the roasting process. So:- 1kg posted and roasted = $29.00 -15%loss = 850grams out @ 20 grams per shot pulled we get 42.5 shots. Lets allow a little waste and an odd binned shot, so 35 shots for our $29.00 investment = 83c each Not bad really for great coffee ? As we normally order a little more than 1 kilo the price per cup will be even better. Have you checked out global coffee prices lately, seen all the big players buying entire crops, increases in demand globally, coffee rust affecting SA crops and the list of price controlling factors goes on. We are lucky to have sponsors such as Bean Green, My Cuppa and MoG all of which are competing in an extremely competitive market. There is no one reputable out there with outlandish prices as the nature of the industry would soon see them disappear into oblivion, just hard working folk trying to make a modest wage in an ever tightening market. Chester
  • Well said mate  :thumb:
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