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Coffee and tea
All Containers›Shop by use case›Coffee and tea›Selling it›What to chargeShop all coffee and tea →
Selling it

What to charge

By Dwight Davis, Founder

Updated

On this page8
Two lines get missed in almost every first costing here: the weight lost in roasting, and the stock that aged out.

What goes into a bag

  • Green coffee, at the cost of the green that became this bag, not the cost of the roasted weight.
  • Roast loss, which is real and varies with roast level.
  • Energy for the roaster, which is substantial.
  • Packaging, which for valve bags is a meaningful per-unit cost.
  • Labor, including packing, which is slower than people estimate.
  • Stale stock, which is a continuous cost in a product with a date.

Cost the green, not the roasted weight

A kilogram of roasted coffee came from noticeably more than a kilogram of green, and costing from the finished weight understates the input by the whole roast loss. Measure it on your own equipment for your own profiles rather than using a figure from somewhere else.

Staleness is a cost line

In a product sold on freshness, stock that passed its date is written off rather than discounted into the market you are trying to build. Put a percentage in the model from the start and track it, because it is the number that tells you whether your batch sizes are right.

Wholesale to cafes is a different calculation

Larger volumes, lower prices, more consistency expected and often equipment or training thrown in. It stabilizes production in a way retail does not, and it has to be costed on its own terms rather than as retail minus a discount.

Bulk is where the packaging cost falls away

Selling into a refill counter or to a cafe in a 4.7 liter container means a fraction of the packaging cost per unit of coffee. That is a real margin difference and it is one of the few places where this property’s economics improve with scale rather than against it.

Do not price against the supermarket

A large roaster buys green at a scale you cannot approach and sells coffee that is months old without that being a problem for their model. The comparison that works is other small roasters and what the buyer is actually choosing between.

Decide the subscription price separately

A subscription smooths production, removes most of the staleness problem and costs shipping on every delivery. It is a genuinely different economic shape from either retail or wholesale, and pricing it as retail with free shipping is how it quietly loses money.

References

21 CFR 101, Food Labeling, which carries the general requirements that apply here in the absence of a standard of identity: the statement of identity, net quantity, ingredient list and the name and place of business of the responsible party. law.cornell.edu
Written from federal regulation and from the published physics and chemistry of staling, not from a laboratory. There is no standard of identity for coffee or tea, so most of what governs a product here is the general requirement that labels be truthful and claims be substantiated. Anything here is a starting point for a conversation with your state department of agriculture, not a determination that you comply.