As Coffee And Fuel Costs Surge, Operators Can Find Opportunity

Feb. 2, 2011
By giving the customer the chance to choose what they want, the operator will strengthen the customer’s loyalty.
Coffee prices have been climbing for the past year, forcing coffee service operators to make some difficult pricing decisions. January was an especially volatile month for those of us who follow coffee prices.For many operators, the higher prices are an opportunity to work with customers to continue to meet their needs.The price increases have been especially noticeable on national brand coffee, a development that some coffee service operators welcome since it helps them move more customers to their more profitable private label coffee.There is nothing wrong with this strategy, but operators need to be sure they have a strategy before talking about prices with customers.Coffee service operators have more coffee products available today than any time in history. They should be communicating their offerings to customers on an ongoing basis, whether or not prices are changing.At the present time, coffee prices are not the only costs that are rising. Fuel costs are heading north as well.Since operators are getting hit with higher costs in both areas, now is a good time to offer customers a variety of choices. One choice could be a return to fuel charges in exchange for holding coffee prices.Operators can offer customers the chance to taste all of their coffees to see if another blend might meet their needs and at the same time save costs.Operators should not have a single proposition in mind when asking customers to sit down and review their program, such as switching to private label. Some customers will choose to keep the coffee they are buying, be it a private label or a national brand.Before anything is done, the entire sales team needs to be involved in developing the strategy. This way, everyone will be on the same page when approaching customers with their options. The company needs to have buy in from its sales team for the strategy to succeed.In the end, the operator will win. By giving the customer the chance to choose what they want, the operator will strengthen the customers loyalty.Isnt it worth taking the time to know what your customers really want?