6 Comments
User's avatar
Matthew Volenec's avatar

I'm assuming this was written by AI?

I was totally expecting you to actually break down the price of your coffee and show us your opex, capex, margins, etc.

It's kind of crazy to click on "How We Price Coffee" and not see a single dollar figure, any hint of a formula, and zero math!

Greg Barber's avatar

That’s a fair question, and I get why you expected something that looked more like a spreadsheet.

The point of the post was to explain what the numbers are anchored to in the first place. Without that context, sharing formulas or margins can actually obscure more than it reveals.

Right now, we’re beginning to add landed price to our coffee bags, which reflects what we actually paid to get that coffee into our roastery. This post was meant to help people understand the difference and why are they are not arbitrary or made up.

There are formulas and math behind how we price coffee. But formulas only make sense once you understand the intent behind them: fairness upstream, realism about operating costs, and accessibility for the people buying the coffee.

Transparency, starts by being honest about what drives prices, where money actually goes, and what someone is supporting when they buy a bag.

That’s the layer we wanted to start with. We can always go deeper, but depth without context rarely serves the conversation.

Matthew Volenec's avatar

Greg, or AI Greg,

Transparency starts by being transparent.

Everlane *used* to do this.

A bag cost:

+ $9.40 in fabric and trim

+ $8.30 in leather

+ $2.70 in hardware

+ $7.80 in construction

+ $7.50 in transport

+ $2.30 in tarrif duties

That's a landed cost of $38.

With a retail price of $95, their margin was 60%.

Nothing about this needs additional context. It's just transparent. That's what's cool about it.

Greg Barber's avatar

Matt, do you buy coffee from us?

Are you going to help baristas explain how pricing works when people are in our stores?

I am making an effort to help our staff and customers understand our business a bit better.

Maybe you should start your own coffee company instead of trying to tell others how to run theirs. I am open to honest conversation, but I don't need an un-hired strategist trying to tell us what to do.

I appreciate the engagement, but the conversation isn't being helpful.

Matthew Volenec's avatar

You’re right. My comments aren’t helpful to what you’re trying to achieve.

I have no interest in telling you how to run your business. I was simply frustrated that I couldn’t find a business lesson here, because that’s the type of content I usually read.

I drank your coffee for 6 years, and I know things are tense in Minneapolis right now. I’m sorry if my comments added to that, for you.

Tomi McLellan's avatar

Good for you, Matt.