By Andrew Nusca
Posting in Technology
The single-serve coffee machine is helping specialty purveyors boost profits and alleviate supply-chain pressure by reducing per-capita consumption.
Those new single-serve coffee machines aren't just convenient, they're wildly profitable.
Following a New York Times report in February that demonstrated just how much those one-cup coffee machines cost you each day (anywhere from two to five times as much), a new Bloomberg interview with Illycaffe CEO Andrea Illy notes that consumption may actually drop as a result of their more precise brew method, too.
"Depending on how fast portion systems penetrate households, we could see a drop in per-capita consumption of about 5 percent," Illy told reporter Marvin G. Perez. "Overall, demand may only drop 1 percent because coffee drinkers who used to take two or three cups a day will drink more."
More profits, less coffee, same cup of morning joe. (That's a smart business model if I've ever seen one.)
Unsurprisingly, Illy is working to angle for a piece of the market long-occupied by Keurig and Nespresso. We'll see how that affects market share, but in the meantime, it seems that the forces pushing consumer convenience are also indirectly helping coffee purveyors alleviate pressure in their supply chain over what is, at the end of the day, a commodity.
Not just saving money, but helping them make more of it, too.
Mar 21, 2012
boy these business people are bright. I have read this piece a few times and can't seem to make any sense out of it. Besides what's it doing in this IBM dominated web site?
Thew few times that I've had such coffee at friends, the single packets weren't recyclable. Plus it takes much more space per lb of coffee and thus larger shipping eco. costs. Finally, while I haven't seen Fair Trade packets, I think I at least saw an organic one. Anyway a "Smart Planet" article should deal with the broader picture.
And I'm retired military, used to drinking coffee that's as bad as bunker fuel, or usable for stripping paint off cars. Give me real beans, ground 5 minutes before being used for brewing.