Should Coffee Shops Roast Their Own Coffee Beans?

Should Coffee Shops Roast Their Own Coffee Beans?

Starting a Coffee Shop Roastery

Should Coffee Shops Roast Their Own Coffee Beans?

Weighing the Pros and Cons of Coffee Shops Roasting Their Coffee Beans

Having a coffee shop often means offering delicious and unique coffees to your customers.

Serving unique coffee profiles from various coffee-growing regions is a wonderful opportunity to differentiate your coffee business from your competition.

Coffee beans are at the heart of your business. If you have a busy coffee shop, you can go through hundreds of pounds of coffee every week.

The situation begs the questions:

• Where will you get your coffee beans from?
• How will your decision impact your operational budget?

When you start a coffee shop, you have two general options for obtaining your coffee inventory.

You can:

• Purchase roasted coffee beans through a wholesale roaster or
• Roast your own coffee beans.

Either of these options is very common and can make financial sense depending on your situation, coffee shop concept, budget, and location.

In today's post, we will discuss whether coffee shops should roast their own beans. There are distinct advantages and disadvantages of buying your roasted coffee beans wholesale – or roasting your coffee beans.

Should Coffee Shops Roast Their Own Coffee Beans?

Should Coffee Shops Roast Their Own Coffee Beans?

Each method of obtaining your coffee beans has its benefits. There is no right or wrong answer to where you get your coffee from, but only what makes sense for your coffee shop.

It is also common for a coffee shop to buy wholesale roasted coffee beans and eventually invest in roasting their own coffee beans. The roasting of beans could occur on-site (at your retail coffee location) or at another off-site location.

Ultimately, your coffee inventory decision rests with your business concept, coffee shop budget, physical space, and local regulations.

What Volume of Coffee Beans Do I Need For My Coffee Shop?

If you are starting your coffee shop, you may wonder how much coffee supply you will need each week or month.

The volume of coffee beans you need ultimately depends on how busy your coffee shop is. You can also assume that your coffee business's demand for coffee will also grow as your coffee business gets further established.

To first determine how much coffee you need, estimate how many coffee beverages you plan on serving.

If your espresso shots are composed of 18 grams of coffee, you can assume that each pound will give you 22 espresso drinks. That is two shots per coffee drink.

It's easy for a small coffee shop to serve hundreds of daily espresso-based drinks. 

For the sake of illustration, let's assume that you sell require 10 lbs. a day. That's 70 lbs. per week or 240 lbs. per month. Let's round that coffee amount to 250 lbs. per month.

You will be paying 250 multiplied by the going wholesale rate of coffee to serve about 5,500 coffees per month. For more information on how much it costs to serve coffee, read our post, How to Determine the Cost of Serving 100 Coffee Drinks.

Should Coffee Shops Roast Their Own Coffee Beans?

Buying Wholesale Coffee Beans

Advantages to buying your coffee beans

• The readily available supply of coffee – When you buy your coffee beans from a wholesale coffee roaster, you don't have to worry about the supply of your beans.

A wholesale roaster's primary focus is to provide the coffee inventory for coffee shops and cafes conveniently. All you have to do is work out the delivery details and pay on time. You can adjust your coffee inventory purchases as you grow your business.

• Utilize the knowledge of others – By buying roasted coffee beans from an experienced roaster, you can rely on their expertise to get the roasted coffee beans just the way you like them. Roasting coffee has its level of expertise required, which can be learned and perfected. With greater efficiencies and workflows, a roaster can deliver your beans to your specs. This efficiency saves you time, money, and potentially many headaches over time.

• Focus on your core business – Buying your coffee bean inventory from a coffee roaster can allow you the energy to focus on your core coffee business. Not roasting your own coffee beans can also free up time, mental bandwidth and reduce startup costs to focus on getting your business up and running.

Should Coffee Shops Roast Coffee Beans?

Should Coffee Shops Roast Their Own Coffee Beans?

 Disadvantages of Buying Your Coffee Beans

• Subject to your roaster's terms – When you buy roasted coffee beans from a wholesale coffee roaster, you are ultimately subject to their terms. Terms may include pricing, delivery days and times, and the types of profiles you can purchase. These terms are often flexible but may not be as convenient as roasting your coffee beans. 

• Paying premium pricing – Coffee roasters must generate a profit to stay in business. Using a coffee roaster, you spend money that could otherwise be saved by roasting the coffee beans yourself. 

• Roasters may require minimum orders – A coffee shop roaster may require a specific minimum order per week or month. This is usually fine in most cases, but if you own a coffee kiosk or mobile coffee business and don't serve coffee regularly, this could pose a challenge.

Roasting Your Own Coffee Shop Beans

Advantages of Roasting Your Beans

• Costs savings – By roasting your own coffee beans, you can save money on every pound of coffee you sell. This can lead to significant savings over time. For example, you might be able to buy green coffee at $4 per pound and roast it yourself.

If you were to buy wholesale beans at $12 per pound, how much would this add up in savings over time?  Using the illustration above, if you purchased 250 lbs. of roasted coffee beans at $12 per pound, that would cost $3000 per month. Of course, if you decide to roast your own beans, there are upfront costs that you need to pay for, such as a coffee roaster, installation, permits, ongoing labor, and green coffee beans.

However, if your coffee business requires a large volume of beans, these costs could be made up relatively quickly. This financial advantage should not be understated. The savings could be thousands of dollars a month if you save $7- $10 per pound of coffee.

• Offer unique coffee profiles – By roasting your own coffee beans, you have the freedom to burn the coffee profiles and tastes that you like – or that your customers want. You aren't beholden to another roaster's profile taste. Your coffee profiles can help differentiate your coffee business and increase sales.

Disadvantages

• Costs for roasting equipment – Coffee roasting equipment is not cheap. Roasting coffee can be an expensive endeavor, especially if you are starting from scratch. Coffee roasters can range from $5,000 to $30,000 to well over $100,000. Additionally, you have to pay for their shipment, installation, and proper permitting.

• Need for physical space – Coffee roasters need clean and safe space to run a coffee operation. You also need space to store your green beans as well. You may require to get a larger retail coffee space in many cases if you decide to roast your coffee on-site.

• Possible distraction to your core business – Having an entire roasting operation can distract your core business. As a coffee roaster, you need to be familiar with logistics and allow time to deliver coffee, store your beans, and roast your beans for yourself or other businesses. This may or may not be a distraction to your retail coffee operation, but it will require time, resources, and labor costs.

Should Coffee Shops Roast Their Own Coffee Beans?

Roasting Vs. Buying Coffee Beans

How Should You Decide to Roast Your Beans?

Your decision to roast coffee beans for your own coffee shop should consider some essential factors before moving forward. We will list a few common elements to consider before deciding which direction to choose.

Roasting Coffee Fits Your Concept

If you might decide early on that roasting coffee will be a long-term coffee business function, then it makes sense to plan to roast your beans.

Your roasting operation will impact your coffee shop budget, retail space requirements, hiring budget, and coffee brand, so it's vital to decide early on if roasting fits your concept.

Roasting Coffee Makes Financial Sense

Beginning a coffee roasting operation can be expensive. You have the cost of the coffee roasting machine, installation, space required for safe roasting, space for storing green beans, and the staff to help you with actual coffee roasting – all need funding.

However, once your coffee roasting operation is up and running, it could offer significant financial benefits to your coffee business. Roasting coffee could increase your profit margins and even allow you to sell wholesale coffee to other coffee shops, generating additional revenue.

Suppose you determine that roasting your beans fits within your coffee shop startup budget and operational budget, and it makes better sense for your coffee business. In that case, moving forward with roasting your own coffee beans seems optimal.

Anticipated Growth

If you plan for future growth, a coffee roasting operation may be beneficial to start early. For example, if you plan to expand your physical space or plan to open a second coffee shop location, roasting coffee may be your ticket.

Your Space Factor

If you have the space for a coffee operation and fit your concept and budget, you may find roasting your own coffee beneficial. Your space should be large enough to provide for a bolted-down roaster, allow for free movement of people, and far away from other materials that will not pose a hazard.

 Local Laws & Permits

Your local regulations determined by agencies may significantly impact your operation. Before signing your property lease – or starting roasting coffee, you should check local ordinances and zoning regulations.

 Coffee Shop Roasting

Should I Roast My Own Coffee Beans?

 Additional Questions:

 Are there other options to roast coffee?

Yes, you can collaborate with wholesale coffee roasters to produce the coffee profile unique to your coffee business. Having an individual profile is one of the advantages of roasting your beans. By collaborating with a local roaster, you can reap the rewards that come with roasting your coffee beans.

As you can imagine, this requires a bit more involvement initially. From there, the roaster may be able to bag your coffee profile in your own branded bags. Keep in mind that not every coffee roaster does this. And those who do may require a specific volume of coffee to be purchased to make it worth their time and effort.

In addition to using your branding, the coffee roaster may require that their logo or text indicating where this coffee was roasted be placed on each coffee bag or coffee package.

What do I need to roast my coffee beans?

Roasting your beans requires sufficient space that should be retrofitted or explicitly designed to handle high heat settings. Next, you will need a coffee roaster machine that will handle the volume of your coffee. Additionally, you will need to install a smoke flue, as well as other coffee equipment. Also, consider researching how which permits you will need to have approved by local agencies, including your health department and fire department. You will also need the space to roast coffee beans. If you have a drive-thru coffee stand business, you probably will not have sufficient safe space to roast coffee unless you roast off-site.

How do I get my green coffee beans?

There are several ways to obtain green coffee beans for your roasting operation. Many green coffee brokers are in various cities in the United States. If your coffee shop is in Europe, you may find green coffee brokers in multiple countries like Germany, U.K, The Netherlands, among others. Connect with a few green coffee brokers, ask about their terms and delivery prices, and compare your options.

The other option is through direct trade – where you go directly to coffee farmers. However, this can be quite challenging and cumbersome if you have no experience directly trading products internationally. Some roasters may also have extra green coffee beans for you to buy, but the supply may be inconsistent. 

How do I find a wholesale coffee roaster?

I always recommend going local for your inventory. This includes local coffee. Search for local coffee roasters in your town, city, or region. Call them up and ask if they are open to selling wholesale coffee for your operation. If they are available to sell wholesale coffee, go and visit with them. If you can, schedule a coffee tasting and bring home a few sample coffee bags.

Coffee can be expensive to ship, so getting your coffee from a local roaster that allows you to avoid shipping costs may help your bottom line. Yet, it is not uncommon for coffee shops to have their coffee shipped from out of state. So, if you are interested in ordering from a coffee roaster that is not in your area, call them and ask if they have sample beans for you to try and their shipping ability.

What kind of roasted coffee beans should I buy?

Ultimately, you should buy the roasted beans you want to drink. Perhaps you would like an espresso blend, a pour-over blend, and a decaffeinated coffee. Next, you may want to order coffee from a particular country or region that you like. For starters, ask your coffee roaster to host a coffee cupping or coffee tasting. During coffee cuppings or tastings, you can try a variety of roasts offered by your wholesale coffee roaster.

What volume of roasted coffee should I buy?

The question of what volume of roasted coffee you should buy depends on your typical sales per day. For example, if you go through 4 – 6 lbs. of coffee in a day, you will want to buy 28 – 42 lbs. of coffee a week. The busier you are, the more coffee you will order.

Coffee Shop Roasting

Should Coffee Shops Roast Their Own Coffee Beans?

We've discussed the advantages and disadvantages of roasting your beans. Each way offers a win-win situation for your coffee business. Finding the best option that works for your coffee shop business is the ultimate trick.

However, if you are still unsure of which direction you should go in. Consider writing out your business plan with both options. See which one makes better financial sense. Ultimately, deciding on financial sustainability will be the top priority for your coffee business.

If you have any questions or thoughts about roasting your own coffee beans, consider emailing us.

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