“When you look at the national landscape, 95% of center store products are national brands, as that tide is changing, the center store CPG is changing more towards a boutique spec,” president Jason Barrow said.
And third-wave coffee (referring to premium preparation and ethically sourced coffee beans) is poised to take advantage of this trend, according to Barrow.
“We’re growing the category because people are asking for more boutique regional offerings because they’re being influenced by what they get at their coffee shop.”
Walmart approached the Denver-based craft coffee company about 18 months ago to develop an exclusive line of direct-trade, single-origin, USDA-organic coffee products that would draw in the Walmart shopper.
Prior to collaborating on the Mash-Up line, Boyer’s Coffee already had distribution deals with Safeway, Albertsons, and Kroger, as well as small shelf presence at roughly 70 Walmart stores that drove 35% growth for the brand in 2016, according to Jason Barrow.
“We were this boutique company that learned how to play with the Safeways, the Albertsons, and the Krogers, and the Walmarts of the world, and we began to gain their trust,” he said.
Boyer’s Coffee roastmaster, Douglass Barrow, developed the single-origin pairings or ‘mash-ups’ for its three SKUs including Colombia + Sumatra Mash-Up, Costa-Rica + Honduras Mash-Up, and Sumatra + Peru Mash-Up all for an SRP of $6.98 per 11-ounce bag.
‘When you sell to Walmart, it’s a gauntlet’
Walmart selected 25% of its top-quartile stores, approximately 1,400 locations, to stock the Mash-Up sub brand.
“When you sell to Walmart it’s a gauntlet, you got to get product set up right, you’ve got to get distribution right, and for most small coffee companies that’s not where you spend your time, you spend your time opening up your second, third, fourth, and fifth coffee shop,” Jason Barrow said.
However, there are a few distinct advantages that come with selling your products in Walmart because the retailer doesn’t use a traditional direct store distribution model where distributors take a cut of sales.
“When you think about our competitors that are third wavers that are putting it on the shelf, they are all using a traditional grocery distribution channel, which is what we do as well when we sell into Safeway and Kroger,” Jason Barrow added.
“We go direct into Walmart where there is no distributor.”
This allows Boyer’s Coffee to price its products at a similar level as Starbucks coffee products, according to the company.
“What I think the anticipation for our company is going to be that this is a game changer, this is an opportunity for a craft coffee company to flex its muscles,” Jason Barrow said.
“We expect exponential growth for the company.”
Where next in third-wave coffee? ‘We’re past the handle bar mustaches and the tight outfits.’
The Barrow brothers emphasized that their focus is bringing premium craft coffee to more consumers not just the $7 matcha latte crowd.
“If you look at the third wave, the first half of it was really more about preparation methods more than the coffee itself,” Douglass Barrow said.
“The second half of the third wave is really now starting to focus on origin and the differentiation of [coffee farm] microlots. Now we’re talking about types of coffee and the nuances and having more intimate conversations with our consumers.”
As part of its partnership with Walmart, Boyer’s Coffee developed a microsite detailing the flavor profile, aroma, preparation methods, and even food pairings for each Mash-Up product.
“Now we’re in a coffee dialogue and people’s palates are becoming refined and people are appreciating the nuances of a light roasted honeyed process Ugandan coffee that’s been ‘Chemexed’ (a manual coffee preparation process. If I was to say those words ten years ago, people would have thought I was a Martian,” Douglass Barrow added.
Transparency in sourcing is also key to Boyer’s Coffee business and the company pays direct-trade prices that support its network of coffee farmers throughout South America, Africa, and Asia.
Boyer's Coffee also takes part in a ‘give back’ program that provides its coffee farmer partners with economical and community support initiatives based on each coffee farming community’s specific needs such as building a school in Peru and providing medical supplies to coffee growing regions of Nigeria.
