“Survivors aren't always the strongest; sometimes they're the smartest, but more often simply the luckiest.” — Carrie Ryan
mycuppa January 2018 newsletter
We kick off this year by looking back at what happened in 2017 and gazing into the crystal ball for trends affecting the Australian coffee landscape in 2018.
Six coffee trends in 2018
We can't roll over the new year without looking back at how we think our industry changed in 2017 and where our Australian coffee market may be heading.
Calls have become louder for changing competitions to use control or blind coffees as a true test of skill, rather than the Formula 1 race car so often disguised as a deceptive everyday urban family vehicle.
I think 2017 will mark a high tide for competition as many experienced companies decline or limit future involvement.
Click on the link below to read more about how this practice of bait & switch is treating consumers as fools.
Micro-Roasters struggling
The second half of 2017 signalled an interesting era in the evolution of the Australian coffee market. Many micro-roasters were closing down and moving on.
Sure, there will still be a burst of new openings, but the basic fundamentals of the "coffee roaster" bubble have quietly burst - not that it's being reported anywhere, as most of the coffee industry publications have vested interests in perpetuating the image of success in order for companies to continue spending $$ on advertising and competition entries (see above).
Retail - a brutal and ugly turning point
For most of 2017, I had churned out numerous articles (so did most of the media) banging on about the rapidly changing landscape of retail.
It's here already, and I'm not talking about the underwhelming whimper that was Amazon Australia's soft launch at the end of 2017.
Click on the link below to read more about how the rapid rise in property valuations has savaged the original fundamentals for retailing.
Logistics - expectation gaps widen
Freight will continue to get slower due to congestion - both in parcel volumes and from our roads - and it will also become a lot more expensive from new fuel surcharges that sneaky shipping suppliers whack merchants with each month.
Our goal is to find solutions that improve upon both of these trends without compromising product quality (freshness), immediacy or cost.
To read more about how added capacity is not really making any difference to the service performance, click on the link below for all the details.
Direct trade coffee is still not disrupting traditional supply chains.
Five years ago, it seemed as though direct trade sourcing of raw coffees was going to disrupt the 150-year tradition of export and import broker supply of commodities to value-added customers like coffee roasting companies.
Fueling the Direct Trade hype were savvy coffee companies keen to exploit what they promoted as distinctive points of difference between themselves and the rest of the industry - promising their coffee was so carefully selected and, of course, having the sole and exclusive rights of supply.
Scale and consistency versus hand-crafted artisan
The fascination with "hand roasted" coffee has become boring and tired - it's no longer new and exciting, and after thousands of images of small, hipster-designer boutique coffee roasting setups, more concerned about stylized Instagram-worthy photos than the substance in the cup, the whole movement is appearing tired and ho-hum.
Consumers are no longer willing to tolerate over-priced, haphazard experiments from new start-ups unable to achieve consistency from one batch to the next (careful, I'm sounding a lot like a politician stuck in opposition).
To read our full article explaining the finer details, please click here for 2018 coffee trends
Yet another Sendle update
If you thought Days Of Our Lives was a long-running drama, tune into Sendle with its twists and turns at every junction.
In late 2017, we switched off Sendle for around a month after experiencing way too many customer incidents.
It was not so much the volume of incidents (well, it is really as if any more than one incident is always bad !); it was more about the severity of these incidents and the ratio of incidents to parcels being sent - just too high.
When I flicked the switch off on Sendle, there was an almost immediate outcry from many of our customers disappointed with the decision - they had been fortunate enough to experience good or even great service from Sendle - so there were plenty of you asking for it to be reinstated.
Behind the scenes, we were working with Sendle to "patch" a problem with local collections from our facility for one of Sendle's partners.
You see, the specific Sendle partner was not collecting parcels reliably (which means every day), and nothing makes my blood boil faster than a courier that fails to collect - it's totally unacceptable to delay our customers.
When you consider we start at 5 am in the morning, roast coffee all day, pack, pick and dispatch rapidly, this schedule runs with ultra-compressed timelines and zero tolerance for delays or failure.
Everything (customer orders) must get out the door each afternoon - no excuses.
To have parcels sitting there at night because a courier failed to collect was making us angry - somewhere, we knew these customers would end up being disappointed, and it was frustrating when we did everything right.
With a solution in place, we switched Sendle back on again and kept a careful, watchful eye on performance.
Yes, there are still incidents occurring with Sendle's partners not delivering parcels professionally and at our end, it's still incredibly challenging to get the couriers to operate on a rapid, routine schedule, but we are getting the orders processing and the mycuppa parcels on the road super-quick at a super-competitive price.
Over the Xmas period, Sendle and its partners were at their worst.
I don't blame Sendle because it's their partners, Couriers Please and Fastway, that decide when to work and when not to.
Couriers are typically focused on business freight, so they know businesses are shut, and hence, they pick that time of the year to take a holiday.
If we are still running with Sendle next year, I will be switching off Sendle before Xmas as this year it was very painful for us.
Having observed Sendle now for many months, here are our views on its current position in the market.
Firstly, It's cheap, and for a national service, it's ridiculously cheap.
It can be fast, but when things go wrong, they go horribly wrong.
It's not the same as AusPost in that AusPost may be more expensive and slower - but AusPost has a relatively robust service standard, just like Mcdonald's, which means you get a certain level of quality that is consistent around the country and with the convenience of LPO collection.
The incident rate on AusPost is barely 9% of Sendle - that's a pretty powerful statement in itself.
Regional areas are a weakness for Sendle and its delivery partners.
This can mean parcels are held (or stuck) in a remote depot until the agent does their round.
We are going to continue with Sendle in the short term until such time as the incident rate becomes too much for us to bear (trust me, I've dropped the F-bomb many times a day, every day, regarding Sendle).
We care for our customers and the entire mycuppa experience - customers have told us loud and clear they want cheap and fast, which is what Sendle provides, and currently, nobody else can match it; however, this comes with the potential of risks for pain if the delivery fails and I'm sure people don't want this - when something goes wrong, we certainly feel it at our end, so please understand that we are trying our absolute best to keep a tight reign on performance.
