SELLING ROASTED COFFEE AT WHOLESALE
_How coffees are sold at wholesale—The wholesale
salesman’s place in merchandising—Ten things
every master salesman should know—Profit sharing
for salesmen—Some coffee costs analyzed—Common
sense in cost finding—Terms and credits—About
package coffees—Coffee-selling chart—Various types
of coffee containers—Labels—Coffee-packaging
economies—Practical grocer helps—Coffee
sampling—Premium method of sales promotion._
In the United States in 1923, some 1,500 coffee roasters and 4,000
wholesale grocers were engaged in the business of selling roasted
coffee in a wholesale way. A number of these also sold green coffee to
retail distributers who did their own roasting.
Most of the roasted coffee sold is ground, although in some parts of
the United States there is a growing consumer demand for coffee in the
bean. Of the coffee sold in trade-marked packages in 1919 in the United
States, about 75 percent was ground ready for brewing.
The larger wholesale houses generally confine their operations to the
section of the country in which they are located, but some of the
biggest coffee-packing firms seek national distribution. In both cases,
branch houses are usually established at strategic points to facilitate
the serving of retail customers with freshly roasted coffee at all
times necessary.
In recent years, too, it has become a general practice for the home
offices, or main headquarters, to advertise their product in magazines,
newspapers, street cars, and by mail and on billboards; while the
branches solicit trade in their territories by means of traveling
salesmen, local newspaper advertisements, booklets, circulars, and
demonstrations at food shows.
_The Wholesale Salesman_
The traveling salesman is probably the most effective agency in
securing the retailer’s orders for coffee. A good coffee salesman not
only sells coffee, but he teaches his customer how he can best build
up and hold his coffee trade. He acquaints the retailer with all the
talking points about the coffee he handles, how to feature it in store
displays and advertisements, how to stage demonstrations and to work up
special sales.
If he is a _good_ salesman, he does not permit the merchant to buy more
coffee than he can dispose of when it is still fresh, and he shows the
dealer the folly of handling too many brands of package coffees. If he
sells coffee in bulk, the efficient salesman has also a sound working
knowledge of blending principles, and is able to suggest the kinds of
coffee to blend to suit the particular requirements of each grocer’s
trade. In short, he takes an intelligent interest in his customer’s
business, and cooperates with him in building up a local coffee trade.
In order to become a master salesman in any line of business, here are
10 things which it is essential salesmen should know:
1. HE SHOULD KNOW HIMSELF. Happy is that man who
has found himself, who is “onto” himself, who appreciates
himself at his true worth, neither more nor less, and
who, having discovered himself and his right relation
to society, resolves to be true to himself. “To thine
own self be true, and it must follow, as the night the
day, thou canst not then be false to any man.” The master
salesman is the man who has found the secret of all
salesmanship, and that is _sincerity_, also the
basis of true character, without which there can never
be a master salesman.
2. HE SHOULD KNOW HUMAN NATURE. The poet has
said, “The proper study of mankind is man.” Know your
fellows. So shall you become more tolerant, and tolerance
helps you to learn _patience_, another of life’s
most important lessons. Knowing human nature comprehends
a study of its weaknesses as well as its strength. All
kinds of people go to make up the world of your prospects.
Try to understand their little frailties and learn how
to turn their psychology to their own, and incidentally
to _your_, advantage. But never take an unfair
advantage. Always be the gentleman. If you can’t afford to
be a gentleman, you have no right to be a salesman. Keep
your head high and your voice low. Every merchant is your
friend, or will be when he knows you. Treat him as such.
3. HE SHOULD KNOW THAT HE IS FIRST OF ALL A SOLDIER IN
THE ARMY FOR THE COMMON GOOD, and that as such he has
a duty to perform in rendering a real social service to
his customers. He needs to get the thought that it isn’t a
package of goods that he is selling, but something bigger
and better, and that is an opportunity. It is his good
fortune, by means of the sale, to open wide the door that
will lead his customer to greater efficiency, to success
and happiness.
4. HE SHOULD KNOW HIS GOODS. Let no detail,
however small, escape you. Get full of your subject.
This is the one safe dissipation for every salesman.
Get intoxicated with your line. We sometimes say of the
successful salesman, as of the genius, “He’s a crazy
Indian.” There is more truth here than we are wont to
recognize; only he is not crazy, he’s just plain drunk,
drunk with enthusiasm for his line. He is literally
_full of it_, and that’s the only way to impart
knowledge of any subject to others,—first get filled with
it yourself. So, find out all you can about your goods. Be
a walking encyclopedia on the subject.
5. HE SHOULD KNOW THE LAWS OF APPROACH. There is
valuable psychology in the right salesman attitude. Always
be agreeable, but not effusive. Don’t argue; never lose
your temper. Anyhow, the customer is always right; you
know that because George Boldt proved it years ago in the
success he achieved by building the Waldorf-Astoria on the
dictum.
6. HE SHOULD KNOW HOW TO TELL HIS STORY SIMPLY,
TRUTHFULLY. There is an art in “getting it across.”
The mechanics of it are not hard to learn. They are based
upon a recognition of the four laws which govern every
sale,—Attention, Interest, Need, and Closing the Sale. It
is important not to become involved in these laws, or to
overemphasize any one of them. There is a time to listen
and a time to stop.
7. HE SHOULD KNOW HIS PROSPECT. Put yourself into
his place. Get his viewpoint. Familiarize yourself with
his problems. Be ready with helpful suggestions for
their solution. Always talk your prospect’s business.
The proposition should ever be, “How can I help
_you_?—how this line will help _you_, save
_you_ money.”
8. HE SHOULD KNOW HOW TO MAKE HIS PROSPECT A SATISFIED
CUSTOMER. To do this don’t sell him something he
doesn’t need, or isn’t ready for or doesn’t want, and
don’t oversell him; but, having sold him, make good on all
your promises. Make the sale fool proof. Follow it through.
9. HE SHOULD KNOW HOW TO RENDER SERVICE. The
transaction isn’t over with the delivery of the goods. For
the master salesman this is only a beginning, the starting
of an endless chain of goodwill. There are helpful
follow-up calls to be made, friendly counsel to be given,
a sincere interest to be taken in the merchant’s welfare,
and this leads naturally into:
10. HE SHOULD KNOW HOW TO MAKE HIS CUSTOMER A GOODWILL
AGENT. A continued lively interest in the merchant
not only holds his trade and keeps him satisfied, but
it soon transforms him into a hard and fast booster for
your line. Then the master salesman does not need to be
told how to capitalize a grateful customer. The customer
himself will show him!
_Profit Sharing for Salesmen_
In a report made by the Bureau of Business Research of New York
University to the National Coffee Roasters Association, the results
were given of a comprehensive questionary, answered by 76 leading
coffee roasters, and it was recommended that commissions on net profits
were the best method of paying salesmen, with the addition of special
bonuses and prizes, charging them with 50 percent of the loss on their
accounts.[2]
[2] _Tea & Coffee Trade Journal_, Sept., 1922, p. 357.
_Some Coffee Costs Analyzed_
In estimating the price at which he must sell his coffee to make a
fair profit, the wholesale coffee merchant has many items of expense
to consider. To the cost of the green coffee he must add the cost
of transportation to his plant; the loss in shrinkage in roasting,
which averages about 16 percent; packaging costs, if he is a packer;
the items of expense in doing business, such as wages and salaries,
advertising, buying and selling, freight, express, warehouse and
cartage, postage and office supplies, telephone and telegraph, credit
and collection; and the fixed overhead charges for interest, heat,
light, power, insurance, taxes, repairs, equipment, depreciation,
losses from bad debts, and miscellaneous items. The average loss for
bad debts among grocers in 1916 was 0.03 percent of the total sales,
according to the director of business research, Harvard University, who
estimated also that the common figure for credit and collection expense
was 0.06 percent. The total cost of doing business has been estimated
as ranging between 12 and 20 percent of the total annual sales; so that
a bag of green coffee costing $16 in New York or New Orleans costs the
coffee packer in the Middle West $22.33 to $24.56, according to the
expense of carrying on his business.
_Common Sense in Cost Finding_
A special study[3] of the statistical requirement of the coffee
trade disclosed that roasters were prone to regard themselves as
merchandising rather than manufacturing establishments, and many of
them are neither one nor the other but a combination of the two. The
statistical requirements of the wholesaler are comparatively simple,
comprising largely a knowledge of the unit costs of warehousing,
shipping, and distributing—all of which are frequently expressed as
percentages to sales. As a concern departs from purely merchandising
activities, however, its statistical needs increase; not only because
of the necessity for knowing the unit costs of processing, but also
because the manufacturers selling conditions are likely to be more
complicated than those of the jobber.
[3] T. M. Harrison; _Tea & Coffee Trade Journal_, April-June, 1923.
Too much emphasis cannot be laid on the effect of unintelligent
competition. A quotes a price; B quotes a lower price, because he
needs the business badly; C quotes a still lower price, on the theory
that he is a better trader than B; finally, A makes a still lower
quotation, because he thinks that there must have been something wrong
in his original figure. It is a vicious circle. The result is to debase
prices, and to bring about a condition of affairs that can be corrected
only by increased knowledge of cost.
The expenditures in the coffee trade may be classified in four major
groups. The relative volume of outgo in these groups will vary in
accordance with the commodities handled, the styles of packaging used,
and the methods of distribution. In order that we get a broad picture
of the problem, the various elements may be aligned as exhibited in the
following tabulation. These percentages may be accepted as reflecting
more or less closely those which might obtain in a house that is
producing a wide line and selling to two or more classes of trade:
Raw materials 50% to 60% of outgo.
Packing materials 10% to 20% of outgo.
Manufacturing costs 5% to 15% of outgo.
Commercial and selling expenses 10% to 25% of outgo.
In cost finding, it is necessary to reduce all classes of outgo to unit
bases, in elements that may be compiled as increments of the final cost
of each product. In some items of expenditure, the unit will apply to
only a single product; in others, it will apply equally to a class of
products and in some cases to all products.
In considering the four major classifications of outgo enumerated, it
will be noted that the unit cost of “raw materials” and “packaging
materials” may ordinarily be identified with individual products
very readily, and hence offer comparatively little difficulty from a
cost-finding standpoint. It is when we come to the numerous items of
“manufacturing costs” and “commercial and selling expenses” that the
cost-finding difficulty arises. The vital statistical need of this
industry is for closer knowledge of the unit costs of doing business,
especially in these elements.
An operating-analysis book is recommended to those roasters who wish
to install a system of uniform accounting. The plan provides for
classifying the expenses. The information thus obtained may be utilized
in building up the cost of individual products.
Wholesale coffee trade contract terms and credits are not dissimilar
from those in other lines of commerce. The wholesaler helps the
retailer finance his business to the extent of granting him 30 to 60
days in which to pay his bill, offering him a cash discount if the
invoice is paid within 10 days of date of sale. Until recent years,
these terms were frequently abused, the customer demanding much longer
credits, and often taking a 10-day cash discount after 30 or more days
had elapsed. This abuse was particularly prevalent from 1907 to 1913,
when coffee prices were low and competition was especially keen. In
addition, the retailers often demanded special deliveries of supplies,
which added to the wholesalers costs, and some retailers refused to pay
the cost of cartage from the cars to their stores.
With the coming of high prices after the close of the World War, the
wholesalers showed a tendency to tighten up their credit and discount
terms, the National Coffee Roasters Association especially recommending
30 days credit, or at most 60 days, and a maximum cash discount rate of
two percent.
Another trade abuse which has been corrected almost altogether was the
practice of “selling coffee to be billed as shipped”; that is, the
wholesaler held coffee on order, and billed only when delivered, even
after weeks or months.
_About Package Coffees_
Since the beginning of the 20th century, the sale of coffee in packages
has increased steadily, until now (1924) this form of distribution
competes strongly with bulk coffee sales. While bulk coffee is still
preferred in some eastern sections of the United States, coffee packers
are making deep inroads there, to the extent that practically all high-
and medium-grade retailers feature package coffees, either under their
own brand name or under that of a coffee specialty house.
The prime requisite for success in any package coffee is the
composition of the blend. One of the leaders in the field, which we
will call Y, is said to be composed of Bogota, Bourbon Santos, and
Mexican. In 1924, it was being sold at retail in New York for 45 cents.
A competing brand, which we will call Z, is said to be a blend of
Bogota and Bourbon Santos. It was being sold at retail in New York at
the same time for the same price. Simultaneously, in the retail stores
of a well-known chain system, a bulk blend composed of 60 percent
Bourbon Santos and 40 percent Bogota was to be had loose for 35 cents.
The second important factor that contributes to package-coffee success
is the container. It must be of such character as will best preserve
the freshness—the flavor and aroma of the coffee—until it reaches the
consumer.
Package coffee has not yet won universal favor. Some of the arguments
used against it are that the price is generally higher than the same
grade in bulk; that it leads to price cutting by stores that can afford
to sell it at about cost as a leader for other articles; that the
margin of profit is frequently too close for some retailers; that, when
the market advances, some packers change their blends to keep down cost
and to maintain the advertised price; and that, when packed ground,
there is a rapid loss of flavor, aroma, and strength.
Friends of package coffees point to the saving in time in handling
in the store; to the fact that the contents of a package are not
contaminated by odors or dirt; that the blends are prepared by experts
and are always uniform; that the coffee is always properly roasted,
and, in the case of package ground coffee, properly ground; that the
brand names are widely and consistently advertised, and that the
retailer has the benefit of the packer’s cooperation in building up
sales campaigns, by means of booklets and local advertising.
Roasted Coffee Chart Showing Prices Necessary to Bring Various
Percentages on Sales
BY A. J. DANNEMILLER
A = _Cost, Roasted and Packed_
————————————————————————————————————————————————————————————
A 10% 11% 12% 13% 14% 15% 16% 17%
————————————————————————————————————————————————————————————
7 7.78 7.87 7.95 8.05 8.15 8.25 8.35 8.45
7½ 8.34 8.43 8.52 8.62 8.72 8.83 8.93 9.04
8 8.89 8.99 9.09 9.20 9.31 9.42 9.53 9.65
8½ 9.45 9.55 9.66 9.77 9.87 9.99 10.12 10.25
9 10.00 10.12 10.23 10.35 10.47 10.59 10.72 10.85
9½ 10.56 10.68 10.80 10.92 11.04 11.17 11.31 11.45
————————————————————————————————————————————————————————————
10 11.11 11.24 11.37 11.49 11.63 11.77 11.90 12.05
10½ 11.66 11.81 11.93 12.07 12.21 12.36 12.49 12.65
11 12.22 12.37 12.50 12.64 12.85 12.95 13.08 13.26
11½ 12.77 12.93 13.07 13.21 13.37 13.54 13.68 13.86
12 13.33 13.49 13.64 13.79 13.95 14.12 14.28 14.46
12½ 13.89 14.05 14.21 14.37 14.53 14.71 14.88 15.06
13 14.44 14.62 14.78 14.93 15.11 15.30 15.47 15.66
13½ 15.00 15.18 15.33 15.51 15.69 15.88 16.07 16.27
14 15.55 15.73 15.90 16.08 16.28 16.48 16.67 16.84
14½ 16.11 16.29 16.48 16.65 16.86 17.05 17.26 17.47
————————————————————————————————————————————————————————————
15 16.66 16.85 17.05 17.23 17.44 17.65 17.85 18.07
15½ 17.23 17.43 17.61 17.80 18.03 18.22 18.45 18.67
16 17.78 17.98 18.18 18.38 18.60 18.83 19.05 19.28
16½ 18.33 18.54 18.75 18.97 19.18 19.41 19.64 19.88
17 18.89 19.10 19.33 19.52 19.76 20.01 20.24 20.48
17½ 19.44 19.66 19.89 20.10 20.35 20.59 20.83 21.08
18 20.00 20.22 20.45 20.67 20.93 21.18 21.43 21.69
18½ 20.55 20.79 21.02 21.24 21.51 21.77 22.02 22.29
19 21.11 21.35 21.59 21.84 22.09 22.36 22.62 22.90
19½ 21.66 21.91 22.16 22.41 22.68 22.95 23.21 23.50
————————————————————————————————————————————————————————————
20 22.22 22.47 22.73 22.99 23.25 23.54 23.81 24.11
20½ 22.77 23.03 23.30 23.55 23.83 24.14 24.40 24.70
21 23.33 23.60 23.87 24.14 24.42 24.70 25.00 25.30
21½ 23.88 24.16 24.43 24.71 25.00 25.29 25.59 25.90
22 24.44 24.72 25.00 25.28 25.58 25.92 26.19 26.51
22½ 24.99 25.29 25.57 25.85 26.16 26.47 26.78 27.12
23 25.55 25.85 26.14 26.42 26.74 27.06 27.38 27.71
23½ 26.11 26.41 26.70 27.00 27.32 27.66 27.97 28.32
24 26.67 26.97 27.26 27.58 27.90 28.24 28.57 28.92
24½ 27.22 27.54 27.84 28.15 28.49 28.83 29.16 29.52
25 27.78 28.09 28.41 28.73 29.07 29.41 29.76 30.12
————————————————————————————————————————————————————————————
A 18% 19% 20% 21% 22% 23% 24% 25%
————————————————————————————————————————————————————————————
7 8.54 8.65 8.75 8.86 8.96 9.09 9.21 9.33
7½ 9.15 9.26 9.30 9.50 9.63 9.75 9.87 10.00
8 9.76 9.88 10.00 10.13 10.26 10.39 10.53 10.67
8½ 10.37 10.40 10.63 10.76 10.90 11.04 11.19 11.33
9 10.98 11.12 11.25 11.40 11.54 11.70 11.85 12.00
9½ 11.59 11.73 11.88 12.03 12.18 12.34 12.51 12.67
————————————————————————————————————————————————————————————
10 12.20 12.34 12.50 12.66 12.82 12.98 13.16 13.33
10½ 12.81 12.95 13.12 13.29 13.46 13.63 13.81 14.00
11 13.43 13.57 13.75 13.93 14.10 14.28 14.47 14.67
11½ 14.03 14.19 14.38 14.56 14.74 14.93 15.13 15.33
12 14.65 14.81 15.00 15.19 15.38 15.58 15.79 16.00
12½ 15.24 15.43 15.63 15.83 16.02 16.23 16.45 16.67
13 15.85 16.05 16.25 16.45 16.67 16.87 17.10 17.33
13½ 16.46 16.67 16.88 17.08 17.31 17.53 17.76 18.00
14 17.07 17.28 17.50 17.72 17.95 18.17 18.40 18.67
14½ 17.68 17.90 18.13 18.35 18.59 18.83 19.07 19.33
————————————————————————————————————————————————————————————
15 18.29 18.51 18.75 18.98 19.23 19.48 19.74 20.00
15½ 18.90 19.13 19.38 19.61 19.87 20.12 20.39 20.67
16 19.51 19.75 20.00 20.25 20.51 20.77 21.05 21.33
16½ 20.12 20.38 20.63 20.88 21.16 21.42 21.70 22.00
17 20.73 20.99 21.25 21.51 21.78 22.07 22.36 22.67
17½ 21.34 21.60 21.88 22.15 22.43 22.72 23.03 23.33
18 21.95 22.22 22.50 22.78 23.05 23.37 23.68 24.00
18½ 22.56 22.84 23.13 23.42 23.70 24.02 24.34 24.67
19 23.17 23.45 23.75 24.05 24.34 24.67 25.00 25.33
19½ 23.78 24.07 24.38 24.68 24.99 25.32 25.66 26.00
————————————————————————————————————————————————————————————
20 24.39 24.68 25.00 25.31 25.64 25.97 26.32 26.67
20½ 25.00 25.30 25.63 25.94 26.28 26.61 26.97 27.33
21 25.62 25.92 26.25 26.58 26.92 27.26 27.63 28.00
21½ 26.22 26.54 26.88 27.22 27.56 27.91 28.28 28.67
22 26.83 27.16 27.50 27.86 28.10 28.56 28.94 29.33
22½ 27.44 27.78 28.13 28.48 28.85 29.22 29.61 30.00
23 28.06 28.38 28.75 29.11 29.48 29.86 30.26 30.67
23½ 28.66 29.00 29.38 29.76 30.12 30.51 30.92 31.33
24 29.27 29.62 30.00 30.38 30.77 31.17 31.58 32.00
24½ 29.88 30.24 30.63 31.02 31.41 31.81 32.24 32.67
25 30.49 30.86 31.25 31.65 32.05 32.47 32.90 33.33
NOTE FOR EXAMPLE: Coffee costing 13.50 per 100 pounds (see first
column), to realize 17% _on sales_, must bring 16.27; which really
represents 21% _on cost_.
_Various Types of Coffee Containers_
Five types of containers are used for packing coffee; namely, cardboard
cartons, paper bags, fiber or paper cans, tin cans, and composite (tin
and fiber) cans and packages. Fiber packages include paraffin-lined as
well as those which have been chemically treated with other water-proof
and flavor-retaining substances.
The carton is popular, because it takes up less room in storage and
in shipment to the packing plant, and also because the label can
be printed directly on the package. Another economy feature is its
adaptability to the automatic packaging machine, which transforms
it from a flat sheet into a wrapped and sealed package of coffee.
Moisture-proof and flavor-retaining inner liners and outside wrappers
are generally used to prevent rapid deterioration of the coffee’s
strength and aroma.
Paper bags are the least expensive containers to be obtained; and, when
lined with foil or prepared paper, are considered to be satisfactory.
Like the carton, the label can be printed directly upon the bag. They
also lend themselves to close packing in shipping cases.
Another popular type of container is the paper, or fiber, can which is
made of fiber board with a slip cover. Fiber cans are also made with
tin tops and bottoms, the metal parts supplying a measure of rigidity
to the package. These composite packages are made round, square, oblong
or cylindrical.
Paraffined containers are characterized by an outer covering of
glossy paraffin, and are made in various shapes. In some makes, the
paraffin is forced into the pores of the paper base, making for added
flavor-retaining and moisture-proof properties. In this type of package
the label may also be printed direct on the package.
In recent years, vacuum-packed coffee has won great favor, first in
the West and latterly in the East. Tin cans are used. Vacuum sealing
machines close the containers at the rate of 40 to 50 a minute. Private
tests by responsible coffee men are said to have shown that coffee in
the bean or ground, when vacuum packed, retains its freshness for a
longer period than when packed by any other method.
_Labels_
Coffee packers must give due attention to certain well defined laws
bearing on package labels. Before the federal Pure Food Act went into
effect on January 1, 1907, many coffee labels bore the magic names
of “Mocha” and “Java,” when in fact neither of those two celebrated
coffees was used in the blend. Even mixtures containing a large
percentage of chicory or other addition were labeled “Pure Mocha and
Java Coffee.” The enactment of the Pure Food Law ended this practice,
making it compulsory that the label should state either the actual
coffees used in the blend, or a brand name, together with the name of
either the packer or the distributer. When chicory or other addition
is used, the fact must be stated in clear type directly following the
brand name. The reading matter on the label should contain statements
of fact only, and should not bear extravagant claims of superior
quality or of methods of preparing or packing that have not been
followed.
_Coffee-Packaging Economies_
During the United States participation in the World War, tin became
practically unobtainable, and coffee packers turned to paper and fiber
containers as substitutes in packaging nearly all grades. In this war
period, commercial economy became a fetish in the business world,
and coffee packers worked to save not only material, but shipping
space, labor, and time. Paper and fiber containers proved to be not
only practicable but economical packages. Because of their wartime
experience, many packers changed permanently to square and oblong
containers. They found that these could be packed “solid” in shipping
cases, leaving no unfilled space between packages, as is the case with
cylindrical cans; also, that smaller shipping cases could be used. As
a further measure of economy, several packers changed from the square
“knocked-down” paper or fiber carton to the oblong carton that is made
up, filled, and sealed by automatic machinery from a flat, printed
sheet of cardboard. This type of container is generally lined or
wrapped with a moisture-proof and flavor-retaining paper.
There has been a tendency in recent years to standardize coffee
packages as a means of working out packaging and shipping economies.
One of the leading American proponents of standardization said:
One of the first arguments raised against standardization
is that it eliminates individuality, and individuality
is one of the big guns covering the front line trenches
in the war of competition. The folly of recommending
that every one-pound coffee carton, for instance, should
be of exactly the same size and shape is immediately
apparent; but let us not confuse such unification with
standardization.
Assuming that a pound of coffee may be safely contained
in 72 cubic inches, we find that a carton three inches
thick by four inches wide by six inches high will serve
our purpose; and, as an illustration of extremes, a carton
three inches thick by three inches wide by eight inches
high, or one [carton] two inches thick by six inches
wide by six inches high, will each have exactly the same
cubical contents. In fact, there is an almost infinite
variety of combinations of dimensions which will contain
substantially 72 cubic inches.
As an example of how coffee packages can be standardized, this
authority cites the following sizes of flat-sheet containers and their
respective dimensions and capacities:
_Thick and Wide, High, Contents,_
_Size Inches Inches Cubic Inches_
1 lb. 2⅝ by 4½ 6¼ 73.83
½ lb. 2¼ by 3⅛ 5¼ 36.91
¼ lb. 1⁹/₁₆ by 2⅝ 4½ 18.46
The advantages claimed for these packages are that each is well
proportioned and makes a good selling appearance, each bears a direct
relation to the other two, and all may be handled with uniformly good
results on the same set of standardized packaging machinery. One size
of shipping case, instead of three, may be used to hold exactly the
same number of pounds of coffee, regardless of whether shipped in
one-pound, half-pound, or quarter-pound cartons. For smaller-dealer
assortments, any two or all three sizes also exactly fit the following
standard shipping cases:
For 36 lbs., 13⅞ in. by 16½ in. by 12¾ in. high.
For 54 lbs., 13⅞ in. by 16½ in. by 19⅛ in. high.
This standardization of packages and shipping containers results in a
lower cost of containers and a smaller stock to carry, with attendant
reductions in details in purchasing and billing departments, in
inventories, and in many other overhead expense factors.
_Practical Grocer Helps_
Wholesale coffee merchandising does not properly end with the delivery
of a shipment of coffee to a retailer. The progressive wholesaler knows
that it is to his best interest to help that grocer sell his coffee as
quickly as possible, to make a good profit on a quick turnover, and to
dispose of it before the coffee has deteriorated.
Practical cooperation between wholesaler and retailer is one of the
most important factors in coffee merchandising. In these days of keen
and unremitting competition, neither agency can stand alone for long.
The progressive wholesaler does not sell a retailer a poorer quality of
coffee for any particular grade than his trade calls for, and he does
not load him up with more than can be disposed of while still fresh.
He gages the capacity and facilities of each retail customer, and then
gives him practical help to keep the stock moving.
The packer of branded coffees helps by advertising to the consumer in
magazines and newspapers, always featuring the name of his brands; and
he supplies the grocer with educational pamphlets and booklets on the
growing, preparation, and merits of coffee in general, with an added
fillip about the desirability of his particular brand. Through his
salesmen the packer shows the grocer how to display the coffee on the
counter and in the window, and often supplies him with placards and
cut-outs featuring his brand. He cooperates in staging special coffee
demonstrations in the store, instructs the retailer in the importance
of teaching his clerks how to talk and to sell coffee intelligently,
and how to prepare advertising copy for his local newspaper, so as to
get the fullest measure of profit from the wholesaler’s national or
sectional advertising.
_Coffee Sampling_
The sampling method of creating a demand for merchandise has been
tried in the wholesale coffee trade, only to be abandoned by the
majority of packers. With other and more satisfactory ways of creating
consumer interest, promiscuous sampling was found to be too expensive,
in view of the comparatively small returns. One indictment against
sampling is that it does not make any more impression on the average
person than does an advertisement that appears only once, and is
then abandoned. Wide-awake merchants have learned that the public’s
memory is exceedingly short; and that they must keep “hammering” with
advertisements to establish and to maintain a demand for their products.
It would seem that the logical place for sampling is in the retailer’s
store, especially in connection with demonstrations. Many progressive
grocers stimulate interest in their coffees by serving, on special
demonstration days, small cups of freshly brewed coffee, giving the
customer a small sample of the brand or blend used, to be taken home to
see if the same pleasing results can be obtained there also. Generally,
this form of sampling, when properly conducted, has shown a larger
percentage of returns than any other method.
_Premium Method of Sales Promotion_
For many years, the premium method of sales promotion has been an
important factor in wholesale coffee merchandising, as well as in
retail distribution. The premium system has been characterized as a
form of advertising, and many coffee packers and wholesalers prefer
to spend their advertising appropriations in that way rather than in
transitory printed advertisements in newspapers and general magazines.
While certain forms of the system have been legislated out of existence
in some states, friends of the plan claim that it is a true profit
sharing method which “blesses both him that gives and him that takes,”
and that it is an advanced and legitimate means of promoting business,
when properly conducted. They assert that it is a system of sales
promotion whereby the advertising expense, plus a large percentage
of the profits of the business stimulated thereby, is automatically
returned to the dealer buyer, without increasing cost or lowering the
quality of the product so advertised; that it eliminates advertising
waste by producing a given volume of sales for a given expenditure
of money; that it reduces the cost of advertising by prompting a
continuous series of purchases at one advertising expense; that it
promotes cash payments and discourages credit business. Premium
users claim that the force of a printed advertisement is often spent
in stimulating the first purchase; while, to secure a premium, the
purchaser must continue to buy the commodity carrying the premium, or
trade with the giver of the premium until merchandise of a stipulated
value or quantity has been purchased.
In general practice, the premium-giving coffee packer or wholesaler
may either offer the retailer an inducement in the form of a desirable
store fixture, household article, or item for his personal use, or he
may offer it to the consumer through the retailer.
The methods of giving the premium are numerous. To the retailer he may
give the article outright with each purchase of a stipulated quantity
of his coffee, or he may offer it as a prize to the retail distributer
selling the most coffee in a certain period in a specified territory.
Frequently the premium is of such value that the wholesaler cannot
give it with any quantity of coffee a distributer can dispose of in a
short time; so he issues coupons or certificates with each purchase,
permitting the retailer to redeem the premium when he has saved the
required number; or, the retailer may get the premium with the first
purchase by paying the difference in cash.
In giving premiums to consumers, the wholesaler follows the same
general plan used with retailers, except that in most cases the coupons
are packed with the coffee and are redeemable at the retailer’s store.
Sometimes, however, the consumer sends the coupons or certificates
to the wholesaler, getting the premium direct from him. In another
phase of the premium system, the retailer works independently of the
wholesaler, buying and giving away his own premiums to promote or to
hold trade for his store. This phase is explained in the next chapter.
[Illustration]
[Illustration: LUHRS, OF POUGHKEEPSIE, N. Y., FEATURES FRESHLY ROASTED
COFFEE IN HIS WINDOW
Smoke from the roasters is blown into the street through the coffee pot
over the door.]