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  • QA 032
    Question:
    How to approach potential buyers?
    Background:
    Until now we have always sold our coffee to local exporters but our members are pressing us to establish an alternative sales channel by entering the export market. We have never approached any roasters or importers and we wonder what the best approach would be, i.e. how do we convince potential buyers to take us seriously? After all, no one knows us and we, basically, know no one either….
    Asked by:
    Cooperative - Central Africa
     
    Answer:

    Importers and roasters receive many approaches, some serious but many not. Many aspiring sellers approach potential buyers on a hit or miss basis, hoping one or two of their missives may bring a result.  But most of these approaches are recognised for what they are and end up in the waste paper basket... 

    Our first recommendation is of course to peruse the Coffee Guide in some considerable detail, including the advice given under 'I want to sell coffee" on our home page…

    This apart, we do not think there is an 'ideal way' in which to approach potential buyers but we can point out some of the more common factors that play a role in determining whether a buyer may see you as a potential supplier.

    Know your coffee. Is it exemplary quality? Specialty quality? Mainstream quality? How have your prices compared with those of others around you? Answers to these questions will suggest which market segment to target.

    Know yourself. What quantities can you realistically supply over what period of time? Can you afford to reserve some of your production to back your export drive? Trying to raise interest without having the coffee to back it is pointless. Is your interest in exporting purely price driven, or are you looking for diversification? Trying for top dollar from day one is equally self-defeating.

    Have a story and state your credentials. Know your area, know what makes you different. Explain how you grow and process your coffee, how you will export it, what you are able to do to support your buyer, what you expect in return. How long have you been in the coffee business? How has your business progressed? Provide names and addresses of those you have done business with, both in your own country and abroad; which associations you are a member of… State your long-term vision but be brief: at this stage no one has the time to read three pages…

    Send a fact sheet. Give information on variety, altitude, soils, annual rainfall, location, annual production by grade and or type, harvesting/marketing season, labour practices, processing system, anti-pollution measures, warehousing, dry processing, distance to port, shipping opportunities to the target market, etc. Be  transparent!
     
    Send a sample. A sample (500 grammes) is better than a thousand words (just like a picture). A sample suggests you understand the importance of quality, that you know your quality and that you have confidence in it. But be sure you send the right sample: fully representative of what you can supply and drawn from a parcel of coffee that itself is fully homogeneous. Understand that the buyer takes a risk when making a first purchase - if the coffee that arrives is no good, what can he do? Propose that shipments can be checked by a third party, both as regards quality and weight. Ask for comments on the quality and suitability of your coffee. What is the buyer's preferred method of doing business? If you can, propose setting up appointments to visit buyers. This demonstrates your seriousness and will go a long way to establishing interest. Get samples to them before you arrive so that you can cup your samples (and others that may compete against you) together.

    Do not make generalised statements about what you can do. Instead be precise and factual. Show that you understand the importance of correct contract execution, the absolute need to ship precisely the quality that was sold, the need for documentation to be in order, etc. Buyers need convincing that you understand these issues and that you are capable of satisfying their requirements.

    Do not make promises you cannot keep. If necessary explain you are a novice but that you are keen to learn.

    Do not make claims you know not to be true. Not only will a buyer quickly pick this up but bear in mind as well that buyers also talk to each other…

    Remember that many roasters, for example in the USA, are not keen to deal direct and rather buy through exporters/importers. Therefore do not concentrate on one sector only but investigate what will be your best options in each individual market. Recognise the importance of intermediaries. Futures markets, language barriers, different time zones, the risk of default on both sides, etc all support the need for exporters, importers, local agents, traders and brokers.

    Finally, match your client to yourself. If you are producing 80 tons annually, do not go to one of the majors like Kraft, Sara Lee or Nestlé. But also do not spend a fortune wooing a roaster who only needs 40 bags a year...

    Posted 19 July 2005
     

    Related chapter(s):
    Related Q & A:
    QA 029