You might be curious what it actually means to "private label coffee".
The simple answer is that private labelling allows you to source coffee beans from a roaster, usually with the option to tweak the blend, and then sell the coffee online (or in-person) with your own branding, pricing, and marketing.
This guide is meant for people who do not operate their own coffee roastery but who are interested in sourcing coffee wholesale and branding it themselves so they can sell the coffee online or through other channels.
The guide will walk you through the possibilites and steps you'll need to consider to sell private labelled coffee.
Using Private Label Coffee Beans to Sell Coffee
1. How to Make Your Own Coffee Brand
If you're looking to sell private label coffee you'll first want to give some thought to what it takes to start your own coffee label or brand. The first question you'll need to ask yourself is "how will my coffee be different". Strava Craft Coffee makes for an excellent case study.
They realized that many coffee brands sought to differentiate themselves by calling attention to the people behind the coffee, so they went the other way and developed a content strategy that told the stories of consumers. To quote them:
By analyzing the market, we realized that the vast majority of coffee roasters were focused on telling the story BEHIND the cup – about the origin of the beans, who grew them, and how unique and special they were. We valued that story but chose to look the other way. We chose to look at the story IN FRONT OF the cup – the story of the consumer.
But the real story is the coffee itself, which is CBD-Infused. From the same article they explain:
We researched, prototyped and reworked our formula and process until we had it just right. The results were profound – a cup of coffee that helped consumers to live better lives – a coffee that was balanced, cut the caffeine jitters, helped reduce anxiety, and offered a myriad of near and long-term wellness benefits.
Differentiating Your Coffee Brand / Product
So the first step, even before you look into sourcing the coffee so you can private label it, is to develop some sense of what it about your coffee that will be both compelling and distinct.
To help in figuring that out, you should give some thought to your typical consumer you will try to be reaching with your coffee brand.
It's tempting to want to create a product with mass appeal, but the coffee business is, well, not lacking in competition.
To build your brand on a solid foundation means having to make some difficult choices.
It's more helpful, at the start, to think of all the things your coffee won't be. All the features, benefits, flavours, and appeals your coffee will absolutely not provide.
For instance, you might decide upfront that your coffee will not be cheap. That will mean losing out on a large number of potential sales and customers. But it will also mean that you have a strong and easily understood direction for your brand.
If you decide to go this way - than you'll be aware upfront that your coffee needs to be positioned as a premium brand.
That decision will significantly influence your choice of private label roasters, the process and blend used, and your marketing and presentation.
This way of thinking will also help you better focus on who your target customer is. If you intend to sell the coffee online, you might opt for a more elegant and sophisticated looking website vs a website that aggressively promotes discounts, sales, and low prices.
More obviously, this decision would impact your pricing. If you want to position the brand as a "premium" coffee seller, than consistency will matter a great deal. When your objective turns to increasing the scale of your sales you'll need to resist the urge to try to lower prices and, instead, consider ways you add value. Something as simple as investing in better more expensive looking packaging, for instance might make more sense.
2. Buying Coffee Wholesale
Wholesale works under the premise that the roaster will achieve some economies of scale in producing the coffee in large enough quantities that they can offer significant discounts.
Buying private label wholesale coffee means you can purchase coffee at a discount, which leaves you room to charge a higher price to the end customer and achieve profitability.
The advantages of wholesale coffee purchasing are that you don't need to take on what's called the "overhead" costs. The actual costs associated with both the labour, expertise, and the equipment required to produce the coffee.
Additional benefits with going this route include the ability to alter the coffee any way you choose (hence the term "private label") and reducing some risk, since many suppliers you'll find have already produced coffee with a quality flavour profile that has been tested against the market.
Al that said, the private label coffee roaster you source the coffee beans from is hardly the starting point in the coffee supply chain. The coffee beans will start their journey from the farm gate, and most pivate label wholesale coffee suppliers you find will have agreements in place to import the coffee beans from a variety of origins.
This means, when purchasing the wholesale coffee, you will likely be asked specifics about what type of coffee you're looking for and those will include features like the initial place of origin, the roast type (dark, medium, light) and the aroma and flavour. It's a fairly involved process and typically takes some time and back and forth with the supplier to shape the final product.
Coffee Order Minimums and Packaging
The other important thing to keep in mind is that the cost of ordering wholesale will vary a great deal depending on the volume and the packaging you specify. Most roasters will have order minimums, like minumem $1,000 worth, and the more volume you order typically means the greater the discount per package.
Packaging will make a difference as well. The deal you work out with the wholesaler will be influenced by things like ordering a lot of coffee beans in 4lb non-descript bags, or are you asking for all the coffee to be made available in 10 oz packages that are ready to be shipped and sold directly to the consumer.
3. Private Label Coffee Roasters
The private label coffee roasters will be providing the product you will be focused on selling. While in most ways you are their customer it's probably better to think of them as a partner. The better a relationship you develop and the better you collaborate ultimately the more you will find your product and retailing operation improve.
Most private label suppliers will go beyond simply providing coffee beans. To secure private label clients many of them will offer services including custom roasting, packaging, and access to experts who can help you make decisions in developing a coffee that reflects the product and brand you are looking to build. Many roasters will also offer a choice of blends they've already pre-selected.
Since these companies are also responsible for importing the coffee beans from their place of origin they will also take on the burden of the various certifications one can acquire. Depending on your brand and your priorities, certifications like "Organic", "Fair Trade", and "Bird-Friendly" are likely ones you'll want to inquire about.
4. Private Label K-Cups
Private label K-Cups became a possibility back when Keurig's patent on them expired. Private label K-Cups are often interchangeably referred to as pods or capsules, although technically there is a difference as K-Cups will only work in Keurig machines.
Never the less, if you are looking to sell single serving coffee pods or capsules there are sources and options available.
Moreover, according to the National Coffee Association, "40 percent of coffee drinkers owned a single-cup coffee brewing machine in 2020" which suggests the market for coffee pods is particularly strong.
Share of U.S. consumers who own a single-cup coffee brewing system from 2005 to 2020
Single serve coffee pods haven't always enjoyed the best reputation with respect to preserving flavours, particular more complex / subtle ones, and with respect to sustainability and the environment. Thankfully technology has progressed and higher quality, recyclable pods are entering the market more and more.
In fact some providers of private label wholesale coffee pods can produce pods made with recyclable #5 plastic (#7 plastic is not recyclable).
As the process to produce these pods continues to be refined, it's looking more and more like these single serving pods will lend themselves to higher quality batch roasted coffees which means they will get closer to balancing quality with convenience.
Of course there's no reason you would have to choose between selling these capsules or selling traditional coffee beans. Depending on how your operation is designed and your product/brand is positioned you could look to coffee pods to expand your target market and capture consumers who prioritize speediness and convenience.
5. Custom Coffee Labels
When looking into sourcing your private label coffee one really important consideration will be what options are available as far as custom coffee labels. Fortunately most suppliers will offer some level of customization as the primary purpose of the "private label" strategy is to afford your business the opportunity to not only sell the coffee but also build a brand in the course doing so. Beyond simply including your company's logo, many coffee sellers will include customer artwork and labelling on the packages for each type of coffee.
The choice of coffee wholesaler needs to be made with more consideration of this aspect of coffee private labelling than you might first guess.
Consider, for instance, the story of "Methodical Coffee" that Frontier Label hosted on their website:
At about 1:56 they explain how they needed to assist Methodical Coffee is creating a label that was water proof to support their launch of their cold brew line of coffee, so they switched to white plastic with matte laminate so it was consistent with the look and feel of their other products (unlaminated) packaging.
6. Drop Shipping
Drop shipping is the practice of passing orders you receive from your website (or other sales channel) directly to a third party company for fullfillment.
You make the sales. Someone else ultimately fulfills them.
The advantages are that it reduces all overheads associated with inventory management, packaging, and shipping. In many cases drop shipping also means you don't pay for the order until you make the sale.
Drop shipping is appealing for most product categories and coffee would be no exception.
Coffee, being a "food", tends to be under more scrutiny and regulation than other products that are typically used to setup a drop shipping business. Fortunately we can confirm that drop shipping coffee is not only possible, but also tends to work hand in hand with private labelling coffee as well. It takes some digging, but you can find suppliers who will not only offer private label services but who will also facilitate the drop shipping model.
Image sourced from Oberlo: https://www.oberlo.com/blog/what-is-dropshipping
You can read our drop shipping coffee guide if you'd like to learn more about how to set this up and make it work with private label solutions.