Coffee Bean Pricing Model for Coffee Roasters and Coffee Retailers | Coffee Cost of Goods
Are you looking to price the coffee you sell? Do you need to determine your coffee price or how much you can profit from your beans or get a grip on your margins? Do you sell whole-bean coffee as a wholesale or retail subscription? Do you want to use different pricing structures for other trade channels like in-store, at a farmers market, to family and friends, or as a coffee subscription? Look no further than our Cost of Goods model for whole-bean coffee!
See a quick video run-through of all the tabs in our Whole Bean Coffee Cost of Good Model Video (note; everything in green is a result!)
Are you looking to price the coffee you sell? Do you need to determine your coffee price or how much you can profit from your beans or get a grip on your margins? Do you sell whole-bean coffee as a wholesale or retail subscription? Do you want to use different pricing structures for other trade channels like in-store, at a farmers market, to family and friends, or as a coffee subscription? Look no further than our Cost of Goods model for whole-bean coffee!
See a quick video run-through of all the tabs in our Whole Bean Coffee Cost of Good Model Video (note; everything in green is a result!)
Are you looking to price the coffee you sell? Do you need to determine your coffee price or how much you can profit from your beans or get a grip on your margins? Do you sell whole-bean coffee as a wholesale or retail subscription? Do you want to use different pricing structures for other trade channels like in-store, at a farmers market, to family and friends, or as a coffee subscription? Look no further than our Cost of Goods model for whole-bean coffee!
See a quick video run-through of all the tabs in our Whole Bean Coffee Cost of Good Model Video (note; everything in green is a result!)
We explicitly designed our comprehensive Coffee Costing Spreadsheet for coffee shop owners and roasters. With our model, you can determine the actual cost of producing and selling your coffee products, including the green bean cost, while accounting for loss/shrinkage during roasting, bagging, and shipping costs.
Do you offer a friends and family discount? How much should it be? What if you want to sell wholesale to local restaurants or retail in your shop? Whatever your whole-bean coffee sales goals, we help you define your cost, dial in your margin, and log your purchases, all in a straightforward document that distills our decades-long experience.
There is other COG software: competent ones that integrate with your purchasing software. But they can only tell you their systems' historical knowledge. Our unique model defines your cost of goods, tests your cost of goods, and forecasts your costs, profits, and margins.
This COG can also help a low-volume coffee roaster who desires to track production but not to pay monthly fees for services like Cropster. As you grow, you can progress into the other software. They do a great job. But if you want to keep costs down, analyze and define your coffee costs and how each number comes together, this COG helps create a consistent coffee business and an effectively run, cash-positive coffee roastery.
Our model includes various costing breakdowns for coffee subscriptions and coffee clubs, allowing you to choose your subscription service's most profitable pricing strategy. Our pricing tools allow you to adjust based on production volume, overhead costs, and profit margins. Our model is easy to use, and our team of experts is always available to answer any questions.
Whether you are selling your coffee products in-store, wholesale, as part of a subscription or coffee club, at a farmers market, or you need to figure it out, understanding the different factors that affect your roasted whole bean coffee and green bean coffee pricing is crucial. You can remain competitive by adjusting your pricing based on the specific circumstances of each sales channel.
We have done all the leg work, so you have to input a few pieces of information in the blue sections and the rest of the information automatically populates. So you can see results in seconds!! Your COG Suite includes a detailed walkthrough training video that ensures you understand every column of this robust tool.
FAQ about Cost of Goods for Coffee Roasters
In what format will I get this digital download?
This calculator will be immediately available upon purchase as a digital download in Google Sheets or Microsoft Excel
What are “COGS”?
COGS is an acronym for Cost of Goods. The cost of goods is the expenses incurred in producing and distributing a product, including the raw materials, labor, and overhead costs involved in selling a product. In other words, it’s all the costs associated with being able to make your product or do what you do. Every business, whether a service or a product manufacturer, usually has highly variable COGS.
What are Coffee COGS?
Coffee COGS is the industry-specific classification of that Cost of Goods Focus. For example, a coffee roastery would have a cost of goods involved in sourcing coffee, storing/roasting/packaging the coffee, and distributing the coffee to the roasteries' various customers. Simply put, the higher the cost of goods, the higher the selling price. In other words, the cost of goods reflects the quality and care that goes into producing a product.
When it comes to whole-bean coffee, the cost of goods can vary depending on several factors: the commodity price of coffee, the costs of importing the coffee along with any potential fees, the cost of storing the green beans, the cost of the equipment to produce and package the finished product, and the infrastructure and costs associated with shipping it or delivering it to the customers.
With all of this in mind, it's essential to note that the cost of goods is not the only factor determining the price. Other factors, such as branding, marketing, and demand, may also significantly determine the final price.
What are the main sales channels for coffee roasters?
Coffee shops and cafes: This is perhaps the most common sales channel for whole bean coffee, where customers can purchase coffee beans to brew at home. Many coffee shops also roast their own beans and sell them on-site.
Online retail: With the growth of e-commerce, online retailers have become an increasingly popular sales channel for whole bean coffee. Consumers can easily browse and purchase coffee beans from the comfort of their own homes, and many online retailers offer a wide variety of coffee types and flavors.
Supermarkets and grocery stores: Many supermarkets and grocery stores carry whole bean coffee, making it a convenient sales channel for consumers who may be doing their regular grocery shopping.
Farmer's markets: Farmer's markets offer a unique sales channel for whole bean coffee, as customers can often meet the farmers and learn more about the beans and the production process. This can be particularly appealing for consumers who prioritize sustainability and ethical production practices.
Specialty stores: Specialty stores that focus on coffee and tea products can also be a sales channel for whole bean coffee. These stores may offer a wider selection of coffee types and flavors, as well as more information about the beans and the production process.
Can you explain “Trade Channels” like I’m a 10-year-old?
When you go to a big store like a Walmart or a Target, there are different sections for different categories: Toys, Electronics, Automotive, Clothing, Food, etc. When coffee roasters make their roasted whole-bean coffee, they also have other places to sell it. These places are called "trade channels."
Some roasters might sell their coffee to a big store that sells it to lots of people, like a Costco or a Sam's Club. Other roasters might sell their coffee directly to people from their websites or in their stores. Other roasters may sell their coffee to smaller stores that sell excellent coffee. They could sell it wholesale to grocery stores or on tables only at Farmers' Markets.
There are many such trade channels. So, trade channels are to coffee roasters as sections are to a store. Each channel/section has different logistics, pricing, scale, and pace requirements.
What are the main “trade channels” of whole bean coffee?
So, "trade channels" refer to the channels or pathways through which we sell coffee to customers. These channels include wholesale distributors, specialty retailers, online marketplaces, and direct-to-consumer sales.
Each trade channel typically has its distinct characteristics, such as pricing, customer demographics, and distribution methods, and roasters may choose to focus on one or more of these channels depending on their business goals and target market.
For example, a small roaster might sell their coffee exclusively through a single specialty retailer. A larger roaster might have a broader distribution strategy, such as wholesale distributors and direct-to-consumer sales.
The main trade channels of whole-bean coffee include:
Coffee sold in-store
Wholesale (to grocery store shelves or other coffee shops and restaurants)
Coffee Subscription/Coffee Club (your own or through others who source various roasters)
Farmers' market
Affiliate Sales like Amazon
Social Sales
Friends and Family Sales
How should I price the coffee I’ve roasted?
A Coffee Costing Spreadsheet! There are many factors to consider, each different for different businesses. This Cost of Goods model can help you determine the cost of producing and selling coffee products. This model considers various factors such as the cost of green beans, loss or shrinkage during the roasting process, the cost of roasting and bagging, and different pricing strategies. Nonetheless, there are three significant factors when pricing roasted coffee.
The first factor is the cost of green beans, including the price per bean pound, shipping fees, and any taxes or duties. You also need to factor in the amount of loss or shrinkage during the roasting process (lucky for you, we build that factor into our model).
The second factor to consider is the cost of roasting and bagging your coffee. This includes the cost of labor, equipment, and packaging materials. You must factor in the time and labor required to burn the beans and the cost of packaging materials such as bags, labels, and boxes.
The third important factor is price strategy. For example, you may offer a lower price for in-house sales to encourage customers to visit your coffee shop, where they will probably also buy a drink and a muffin, or you may charge a premium for the convenience of a coffee club subscription to cover the cost of shipping materials and labor to get it out the door.
The Cost of Goods model also includes cost breakdowns for coffee subscriptions and clubs. Lastly, the Cost of Goods model includes pricing tools to help you find your product's best sales price and margin.
Costs to Consider when starting a coffee roastery
If you are opening a coffee roasting business, there are several costs to consider to ensure that your business is sustainable and profitable. Here are some of the most significant costs to consider:
Equipment Costs: The equipment for roasting coffee beans is one of the most significant costs. This equipment includes roasters, grinders, packaging machines, and other related equipment. The cost of equipment can vary widely depending on the quality and capacity of the equipment.
If you are opening a coffee roasting business, there are several costs to consider to ensure that your business is sustainable and profitable. Here are some of the most significant costs to consider:
Equipment Costs: The equipment for roasting coffee beans is one of the most significant costs. This equipment includes roasters, grinders, packaging machines, and other related equipment. The cost of equipment can vary widely depending on the quality and capacity of the equipment.
Facility Costs: You will need a suitable facility to house your coffee roasting operation, including leasing or purchasing a building or space and costs associated with building out the space to meet your needs.
Green Coffee Beans: You must purchase green coffee beans to roast and sell. The cost of green coffee beans can vary widely depending on the origin, quality, and quantity of the beans.
Labor Costs: You must hire employees to help with your coffee roasting business's roasting, packaging, and other aspects. These costs include salaries, benefits, and other related costs.
Packaging and Shipping Costs: You must package and ship your coffee products to customers. This cost includes the cost of packaging materials, shipping fees, and other related costs.
Marketing and Advertising Costs: You must invest in marketing and advertising to promote your coffee roasting business and attract customers. This cost includes website creation, social media advertising, and other promotional efforts.
Legal and Regulatory Costs: You must comply with local and federal regulations, which may include obtaining permits, licenses, and other legal requirements. You may also need legal counsel to assist with any legal issues.
Insurance Costs: You must purchase insurance to protect your business and employees from any accidents, liability claims, or other issues that may arise.: You will need a suitable facility to house your coffee roasting operation, including leasing or purchasing a building or space and costs associated with building out the space to meet your needs.
Green Coffee Beans: You must purchase green coffee beans to roast and sell. The cost of green coffee beans can vary widely depending on the origin, quality, and quantity of the beans.
Labor Costs: You must hire employees to help with your coffee roasting business's roasting, packaging, and other aspects. These costs include salaries, benefits, and other related costs.
Packaging and Shipping Costs: You must package and ship your coffee products to customers. This cost includes the cost of packaging materials, shipping fees, and other related costs.
Marketing and Advertising Costs: You must invest in marketing and advertising to promote your coffee roasting business and attract customers. This cost includes website creation, social media advertising, and other promotional efforts.
Legal and Regulatory Costs: You must comply with local and federal regulations, which may include obtaining permits, licenses, and other legal requirements. You may also need legal counsel to assist with any legal issues.
Insurance Costs: You must purchase insurance to protect your business and employees from any accidents, liability claims, or other issues that may arise.
How can I get this Coffee Costing Spreadsheet?
This Coffee Costing Spreadsheet will be available for digital download immediately after purchase in Microsoft Excel format.
What are the Usage rights of this purchase?
You have unlimited private usage rights. Use it to your heart’s content to analyze your coffee roasting cost of goods. Make copies of it to try different strategies for yourself or to track your cost by year. Build on it, adjust it, make it your own. It’s yours.
With that said, this document is intended for your private use of your business venture and cannot be shared, resold, or given in any form of intellectual transfer of some way created from this document without the direct written permission of Conscious Bean.
What’s the Return Policy?
If this product truly doesn’t solve your need, we will return your original purchase price 100%.