ON
A research project submitted to the Institute of Hotel Management, Catering Technology and Applied Nutrition, in partial fulfillment of the requirement for the 3 year B.Sc. course in Hospitality and Hotel Administration
_______
Mr. Abhishek Bhosle
(Research Guide)
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Mr. Kamlesh Dange
(Research Co-ordinator)
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Miss Malvika Puranik
(Student)
CERTIFICATE
This is to certify that Ms. Malvika Puranik, a third year B.Sc. Student of Institute of Hotel Management Catering Technology and Applied Nutrition, GOA, has successfully completed his Research Project titled Psychology In Eaten Trends, as a part of the three year B.Sc. in Hospitality and Hotel Administration.
TABLE OF CONTENTS
1. ACKNOWLEDGEMENT 2. LIST OF TABLES 3. LIST OF FIGURES 4. ABSTRACT 5. CHAPTER i. INTRODUCTION ii. REVIEW OF LITERATURE iii. AIMS, OBJECTIVES & HYPOTHESIS iv. METHODOLOGY v. RESULTS & DISCUSSION vi. SUMMARY & CONCLUSION 1. LIMITATIONS & RECOMMENDATIONS 2. BIBLIOGRAPHY
ACKNOWLEDGEMENT
With deep sense of gratitude, I acknowledge my indebtedness to all the people who have helped me in the preparation of this report. I am very delighted to express my kind regards to our faculty coordinator of the research project- Mr. Kamlesh Dange and my respected guide- Mr. Abhishek Bhosle who provided me with valuable guidance to complete my project. Special thanks to Mrs. Sakina who also guided me and supplied me with information regarding my project and also for solving my technical difficulties that I came across during the course of my project.
LIST OF TABLES
1. Estimated Domestic Consumption in India (1995 - 2008)
2. Exports of Coffee from India by Countries FY 2008/2009 * (Quantity, Percentage and Unit Value) 3. Production of coffee in major states/ districts of India.
LIST OF CHARTS
1. 2.
Fig 1- Favorite hangout places Fig2 -factors influencing your above decision
3. Fig3 preference in hangout places for drinking coffee 4. Fig 4- factors influencing your above decision 5. Fig 5- preferences in choosing your company 6. Fig 6-ones favourite coffee bar
AIM
To analyse the changes taking place in the coffee industry in the recent past.
To study the behaviour and preferences of coffee drinkers in Goa. Coffee Industry in India. Changing Trends of coffee Industry in India.
THE METHODOLOGY
The study has been divided into two distinct phases: the preliminary phase and the second phase. The preliminary phase, This consisted of exploratory research. For this, questions were made based on the above assumptions. These were then tried on 5 to 6 consumers which helped me add or delete choice and hence prepare the final questionnaire. This also helped me to properly delineate the scope and modus operandi for the successive steps. The second phase Questionnaires were administered to samples from the target age group as identified through exploratory research, as well as existing employees of such coffee-bars/outlets. 20 consumers were asked to fill the questionnaire. This data thus collected has been supplemented with secondary data sourced from various printed matter and the Internet. Following this, the data was put to frequency analysis and presented in the form of a report. The report presents a consolidated list of attributes that are contributing to the success of coffee bars. Also, recommendations for enhancement of the overall experience of the customer have been put forth. The intention has been to explore similarities and dissimilarities in the perceptions of consumers and the coffee bar owners, and to help bridge this gap.
INTRODUCTION
Somewhere on the world right now, a person is waking up feeling a bit groggy. Perhaps they're getting ready to go to work or maybe even to school. Regardless of their situation, this person isn't feeling that great. They just need one thing to put them in the proper frame of mind to have a good day. That thing: coffee.
Coffee is one of the most popular drinks in the world. Its popularity is evident by the fact that it is among the three largest traded commodities in the world. Originally just a simple drink, coffee has spawned numerous other coffee-based beverages from espresso to cappuccino. Java and mocha have become a part of the English lexicon. As have the terms grande and venti and short to describe different sizes of coffee. Jim Jarmusch made a critically acclaimed movie called Coffee and Cigarettes, in which every scene was based around characters drinking coffee or a coffee-related drink like tea. Coffee has become ubiquitous in our world and has become the domain for activists, who protest the conditions of coffee planters and promote fair trade coffee. It has become a major seller for large corporations that sell countless varieties of specialty coffee and flavored coffee. Additionally, coffee has created a mini rivalry between true coffee lovers and posers. The true coffee lover prefers the smooth blend of an Ethopian Harar blend above anything else. Of course, individuals that drink instant coffee are instantly shunned from the coffee loving community.
So, now that we have determined that coffee creates a lot of passion among its drinkers, we have to look at exactly what is the appeal of coffee? Perhaps it's in the lovely, strong smell of a fresh cup of coffee that tickles your sense of smell, which creates a sense of anticipation in your taste buds. It can also be the taste, the sudden jolt that you get when you sip a nice, strongly brewed cup of coffee. It can also be in the flavor and considering how many types of flavored coffee is available, it is now possible to have a specific type of flavored coffee blend for every one of your moods. It can also just be the social factor,
as there are very few things as relaxing with friends having a cup of coffee and just talking nonsense.
REVIEW OF LITERATURE
COFFEE HISTORY
The word coffee comes from the Arabic quwah. Coffee originated in Ethiopia, where Coffea arabuca, one of the three main species, grow wild. The others, Coffea robusta and liberica respectively. The coffee tree requires a hot, moist climate and a rich soil. Arabica was cultivated about 575 AD but it was not until the fifteenth century in Southern Arabia that the plant was extensively cultivated. From there it spread to countries bordering the Indian Ocean and the Mediterranean. According to the Kaldi Coffee Legend, coffee is said to have been first discovered when a goatherd in Abyssinia observed his goats dancing on their hind legs after eating some red berries. This prompted him to taste the berries, and his eyes opened. He took some of the berries to the village, where everyone took a fancy to the discovery, as it helped them stay awake during their prayers. Since then coffee became so popular that the worlds first coffee shop was opened in Constantinople in 1475.
Coffee is today the largest traded commodity in the world, second only to crude oil. Brazil and Columbia are the top two coffee producers in the world, accounting for more than 40% of the total world produce. India's contribution is a paltry 4.1%.
In India coffee cultivation is largely confined to the hilly regions of the southern states of Karnataka, Tamil Nadu and Kerala. Karnataka accounts for 53 percent of the planted. c 850 First known discovery of coffee berries. Legend of goat herder Kaldi of Ethiopia who notices goats are friskier after eating red berries of a local shrub. Experiments with the berries himself and begins to feel happier. c 1100 The coffee first trees are cultivated on the Arabian peninsula. Coffee is first roasted and boiled by Arabs making "qahwa" --- a beverage made from plants. 1475 The worlds first coffee shop opens in Constantinople. It is followed by the establishment of two coffee houses in 1554. c 1600 Coffee enters Europe through the port of Venice. The first coffeehouse opens in Italy in 1654. 1607 Coffee is introduced to the New World by Captain John Smith, founder of Virginia at Jamestown... Some Canadian historians claim it arrived in previously settled Canada. 1652 The first coffeehouse opens in England. Coffeehouses are called "penny universities" (a penny is charged for admission and a cup of coffee). Edward Lloyd's coffeehouse opens in 1688. It eventually becomes Lloyd's of London, the world's best known insurance company. The word TIPS is coined in an English coffee house: A sign reading To Insure Prompt Service (TIPS) was place by a cup. Those desiring prompt service and better seating threw a coin into a tin. 1
1672 The opening of the first Parisian cafe dedicated to serving coffee. In 1713, King Louis XIV is presented with a coffee tree. It is believed that sugar was first used as an additive in his court. 1683 The first coffeehouse opens in Vienna. The Turks, defeated in battle, leave sacks of coffee behind. 1690 The Dutch become the first to transport and cultivate coffee commercially. Coffee is smuggled out of the Arab port of Mocha and transported to Ceylon and East Indies for cultivation. 1721 The first coffeehouse opens in Berlin. 1723 Coffee Plants are introduced in the Americas for cultivation. Gabriel de Clieu, a French naval officer, transports a seedling to Martinique. By 1777, 1920 million coffee plants are cultivated on the island. 1727 The Brazilian coffee industry gets its start from seedlings smuggled out of Paris. 1750 One of Europe's first coffeehouses, Cafe Greco, opens in Rome. By 1763, Venice has over 2,000 coffee shops. 1822 The prototype of the first espresso machine is created in France. 1885 A process of using natural gas and hot air becomes the most popular method of roasting coffee.
c 1900 Kaffeeklatsch, afternoon coffee, becomes popular in Germany. 1905 The first commercial espresso machine is manufactured in Italy. 1908 The invention of the worlds first drip coffeemaker. Melitta Bentz makes a filter using blotting paper. 1933 Dr. Ernest Illy develops the first automatic espresso machine. 1938 Nescaf instant coffee is invented by the Nestl company as it assists the Brazilian government in solving its coffee surplus problem. 1945 Achilles Gaggia perfects the espresso machine with a piston that creates a high pressure extraction to produce a thick layer of crema. 1991 Caff Carissimi Canada, a network of espresso service providers is formed in Canada, modeled after a visit to Franco Carissimi (roaster and equipment manufacturer) in Bergamo Italy. It becomes the fastest growing network of private and independant super automatic machines providers in Canada. 1995 Coffee is the worlds most popular beverage. More than 400 billion cups are consumed each year. It is a world commodity that is second only to oil
opportunity to choose from a variety of coffee beverages. All the big hotel chains - Viz., Le Meredian, The Oberoi, Taj Group of Hotels, etc. - have exclusive coffee shops with a wide choice of coffees to offer their clients and corporate visitors. A more amazing fact is the way in which people have readily accepted these new varieties of coffees. The majority of the market for these coffees lies between the age groups of 18-45 years old. Even though not many people have thought of this idea, some coffee exporters, ABC Ltd. for example, have opened espresso bars and are doing quite well. And while the country's EXIM policy does not allow the import of coffee beans in any form for home consumption, India itself produces a wide variety of specialty coffee such as the Mysore Nuggets (grown at an elevation of over 4,000 ft.), the Kaapi Royale, the high grown Girls, the Robusta Parchment AB's, and the Monsooned Malabar AA. These coffees have been used in various blends to produce a fine cup of espresso. India is a bird-friendly country; our coffee is grown under natural shade, which makes for a bolder, more uniform bean than coffee grown under open conditions. Even though the per capita consumption of coffee in India is very low at 54 grams, the government of India has chalked out an ambitious plan (as declared in the National Coffee Conference held at Bangalore on December 11, 1998) to improve this low per capita consumption through generic promotion. It is a well accepted fact that, given these changing trends, there is great potential for setting up these espresso coffee bars in India. I don't see any reason why potential investors such as Starbucks and machine manufacturers such as La Marzocco, Rancilio, or Brasilia should not set their eyes on our country. If we can change the coffee drinking habits of the Indian consumer and at the same time increase domestic consumption, then we will probably be looking at a huge potential market for specialty coffee.
Significant increase both in production and exports notwithstanding, the international coffee market has been experiencing continuous fall in the commodity since the beginning of the current year (2007). The composite indicator prices, according to the Internatioal Coffee Organization's market report, has dropped to US cents 99.30 per LB in April, 2007 from US cents 105.81 per LB in January 2008. Production of coffee during first six months of the coffee year 2006-07 stood at 9.29 million bags in March 2007 signifying an increase of 15 percent from 8.07 million bags recorded during comparable period of CY 2005-06. Exports in the first 6 months of coffee year 2006/07 (Oct-06 to Mar-07) were up over 18 percent from the same period last year totalling 48.49 million bags compared to 40.98 million bags. Arabica exports in the 6month period went up by over 13 percent from 27.39 million bags to 31.07 million bags, whereas Robusta exports increased by over 28% from 13.59 million bags to 17.41 million bags. Volume wise, the permits issued for coffee exports in fiscal 2006-07 is the highest ever (2,58,546 tonnes) surpassing the previous best of 2,46,908 tonne of actual exports in 2000-01. Export earnings in fiscal 2006-07 is the highest for the past 8 years i.e. since 1999-2000.The total export earnings will cross Rs.2000 crore for 2006-07. According to ICO Executive Director Nstor Osorio,there are only a few measures that could directly address the supply-demand balance. On the supply side in view of the political and technical difficulties of supply-management schemes two policies were possible: (a) to create awareness best achieved through the ICO in national and international bodies of the danger of embarking on any projects or programmes which would further increase supply; and (b) working to increase the benefits accruing from value-added products rather than traditional bulk commodity exports. The greatest potential for restoring balance, he
pointed out, lay in promoting market development measures to increase demand. These should include: (a) support for the ICO Quality-Improvement Programme as a means of improving consumer appreciation of coffee as well as having an associated effect of removing some sub-standard coffees from the supply side of the world coffee equation; (b) action to increase consumption in coffee-producing countries themselves, which should have a number of positive effects such as providing an alternative market outlet, increasing producer awareness of consumer preferences, stimulation of small and medium enterprises, etc., as well as acting to increase demand; (c) action to enhance knowledge and appreciation of coffee in large emerging markets, such as Russia and China, following the successful ICO campaigns in the 1990s; and protecting consumption levels in traditional markets through quality maintenance, development of niche markets and dissemination of positive information on the health benefits of coffee consumption. According to latest ICO monthly report, world consumption in 2006 is estimated at 117.93 mn bags compared with 116.06 mn bags. While ICO member countries' domestic consumption in 2006 is estimated at little over 31 mn bags, the importing countries consumption is estimated at 86.84 mn bags. European Community's co nsumption is higher at 38.97 mn bags compared with 85.75 mn bags in 2005. India accounts for about 4.5 percent of world coffee production and the industry provides employment to 6 lakh people. Among the coffee growing states, Karnataka accounts for 70 percent of country's total coffee production followed by Kerala (22 percent) and Tamil Nadu (7 percent). Europe accounts for about 70 percent of India's total coffee exports. Of this again, 70 percent is shipped via Suez Canal. Major Indian coffee importing countries include Italy, Germany, Russian federation, Spain, Belgium, Slovenia, US, Japan, Greece, Netherlands and France.
Calendar Year 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008
Quantity (in MT) 50000 50000 50000 50000 55000 60000 64000 68000 70000 75000 80200 85000 90000 94,400
Exports of Coffee from India by Countries FY 2008/2009 * (Quantity, Percentage and Unit Value)
Sl No 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45
Destination ITALY RUSSIAN FEDERATION GERMANY BELGIUM SPAIN UKRAINE FINLAND JORDAN CROATIA SLOVANIA GREECE SWITZERLAND FRANCE MALAYSIA KUWAIT AUSTRALIA PORTUGAL HUNGARY ISRAEL SINGAPORE EGYPT ALGERIA NETHERLANDS U.S.A. LIBYA SAUDI ARABIA UNITED ARAB EMIRATES JAPAN TAIWAN POLAND UNITED KINGDOM LATVIA TURKEY CANADA SYRIA ROMANIA AUSTRIA CHINA,PEOPLES R/O NORWAY TUNISIA VIETNAM SULTANATE OF OMAN INDONESIA MYANMAR OTHERS TOTAL
Quantity (In MT) 50802 16123 14649 9673 8556 5445 5292 5187 4819 4715 4614 3813 3784 3730 3536 3140 2898 2774 2745 2566 2566 2448 2106 1948 1913 1738 1716 1679 1361 1336 1285 1241 1206 1158 1150 972 870 821 794 721 628 598 572 548 6297 196531
% to Total 25.85 8.20 7.45 4.92 4.35 2.77 2.69 2.64 2.45 2.40 2.35 1.94 1.93 1.90 1.80 1.60 1.47 1.41 1.40 1.31 1.31 1.25 1.07 0.99 0.97 0.88 0.87 0.85 0.69 0.68 0.65 0.63 0.61 0.59 0.59 0.49 0.44 0.42 0.40 0.37 0.32 0.30 0.29 0.28 3.20 100.00
Unit Value Rs/Tonne 108431 122337 123290 105832 97231 139936 130752 112351 96869 95455 97514 130654 111941 103402 128257 117913 97608 118054 102583 117929 93975 94367 115885 134985 92029 138437 139997 138062 109863 110802 131621 137686 125829 107599 109718 97644 93726 107190 114097 104177 107241 108954 135188 110628 138695 114594
Post Blossom Estimation Post Monsoon Estimation State/District Karnataka Chikmagalur 2008-09 2007-08 Arabica Robusta Total Arabica Robusta Total 38,850 32,900 71,750 36,300 27,400 63,700
Kodagu Hassan Sub total Kerala Wyanad Travancore Nelliampathies Sub total Tamilnadu Pulneys Nilgiris Shevroys (Salem) Anamalais (Coimbatore) Sub total Non Traditional Areas Andhra Pradesh & Orissa North Eastern Region Sub Total Grand Total (India)
4,200 16,625
4,050 18,100
4,800 80 4,880
80 45 125
3,110 90 3,200
65 60 125
The coffee regions in India are in the three southern states of Karnataka, Kerala and Tamilnadu, apart from a small quantity (approx. 8%) which is grown in the nontraditional belts of Andhra Pradesh and the North Eastern States of India such as Assam, Nagaland and Arunachal Pradesh. Karnataka State, which constitutes 53% of the countrys production, produces both Arabica and Robusta. While Kerala predominantly produces Robusta coffee [28% of the total production in India is grown in this state], Tamilnadu produces both Arabica and Robusta, growing 11% of the total coffee grown in India. In the State of Karnataka, the top quality coffee regions are Chikmagalur, Bababudan, Biligiris and Coorg. The altitude at which coffee is grown in Chikmagalur is between 2,000 and 3,500 ft, with Arabica production being approximately 20,000 T and Robusta 25,000 T. This district includes the famous Mysore coffee, which has a visual quality of long wide beans, with bluish grey color and the cup is characterized by mild body, fair acidity and fine subtle flavor. The uniqueness of Mysore coffee is that it could be used as
the main component of a blend; as a fragrant aromatic topping for a drink or lending to being blended with coffees from other origins. The famous Bababudan Hills, where the first coffee seeds were planted by a pilgrim Saint Bababudan, to result in the birth and establishment of the present Indian coffee industry, is a top quality coffee region in India. This region is often referred to as the Giris. Here, coffee has been planted at a high altitude of 3,500 to 5,500 ft, yielding excellent quality dense coffee beans. This hill produces 35,000 T Arabica and 5,000T Robusta. The washed Arabicas of the Giris have Good Body, Fine Acidity and an aromatic bouquet, with distinct mocca flavor. The gourmet markets in the world, including Japan, purchase this regional coffee, which has the distinction of not only highlighting exotic dark roast espressos, but also providing the base for an espresso. A dual role is indeed the speciality of this coffee from the Giris. Biligiris is not a well-known coffee region, but has the potential to produce a small quantity, yet exotic quality coffee beans. The altitude is 3,500 to 4,500 ft and the quantity of Arabica produced is just 5,000 T. Small growers dominate this growing district and produces some of the finest, large elongated coffee beans, with discerning floral notes, laced with acidity. Coorg, known as Kodagu, the home to the respected coffee growing community of the Kodavas, produces both Arabica and Robusta coffees. The elevation ranges from 1,500 to 3,500 ft, with Arabica accounting for approx. 25,000 T and Robusta 60,000 T. The Robustas produced are some of the best in the world, with the beans being compact, oval to round in shape with pointed tips and golden brown colour. As for the Robusta Parchment, the highest quality in India is obtained from this region. The beans have a bluish grey colour, with soft and Neutral tones in the cup and could provide the buttery crema, which is a hallmark of quality in an espresso drink. 2 Left: The famous Babaduban Hills, a top quality coffee region also called the "Giri's"; Right: Araku Valley, a non-traditional coffee area in Andhra Pradesh.
Kerala, with its wide expanse of backwater lagoons and coconut trees, produces mainly quality Robusta, of approximately 55,000 T. Some of the excellent Robusta Cherry coffees in India are from the regions of Wynaad and Travancore in Kerala State. The Robusta Cherry beans from Wynaad are produced at an altitude of 1,000 to 2,000 ft, accounting for around 40,000 T of Indian Robustas. The beans have the characteristics of golden brown color, with strong body and bright neutrality in the cup. Travancore Robustas, almost unheard of, are uniquely distinct, with the potential for preparation of special and even specialty coffees!! The Travancore region, best known for its beautiful topography, hilly terrain and above all the Maharajas and the Maharanis of yesteryears, also produces Robusta coffees, which have unique cup quality. The quantity produced in this region is approximately 10,000 T, at an altitude of 2,000 to 3,000 ft. The Robusta beans could be best described as golden bold beans, with sparkling neutrality and hardly any bitterness. Tamilnadu, the state remembered for its myriad temples and historic culture, produces both Arabica and Robusta coffees, with Arabicas of approx.12,000 T and Robustas of 5000T. Nilgiris, the number one region in the world market for fragrant teas, is also the home to aromatic and distinguished coffees from India. The Nilgiri Hills also known as the Blue Mountains of India, produces just 2500 T of quality Arabica. The beans are blue in color, large and wide with tight white centre cuts. In the cup, the quality is best described as full bodied with fine acidity and flavor akin to wild berries. These coffees could be compared with some of the finest coffees from Ethiopia and are appreciated by German and Japanese buyers, who find their flavor and acidity excellent components for canned coffee. Shevaroy Hills is a place of scenic beauty, centered around a lake, with coffee bushes and forest trees adorning hills at an altitude of 3,500 to 5,000 ft and producing just 3000 T of quality Arabica. Oranges, peaches and apples playing truant with ripe red coffee cherries is the trade mark of Shevaroy Hills. As for the coffee beans which are medium in size, are dense, distinctly green in color and have good clear acidity and a fragrance with a hint of Spice. Truly unique beans to be served as filter coffee.
Anamalais, as the name implies, is the home to numerous herds of elephants, producing special Arabica coffees, which are still unknown to coffee connoisseurs around the world. This region in India, produces approx. 2,000 T of Arabica coffee, at an altitude of 2,000 to 3,500 ft. The beans are large, greyish green in colour with a balanced cup, highlighted by fruit notes. The beans also roast evenly and lend themselves to uniform and effective blending - a coffee roasters delight! From the traditional coffee areas to the non-traditional coffee areas of Araku valley in Andhra Pradesh and Kohima in Nagaland, Indian coffee is certainly preserving not only the natural forests in these areas by preventing shifting cultivation; providing employment to the tribal force (90% of whom are women and uplifting their lives) but also enabling the preparation of some fine distinct coffees from these areas. Special strains of coffee with lineage to an Ethiopian strain are being processed with upgraded processing technology and the marketing of these coffees with distinct brand identities are being explored. Distinct Preparation Techniques To Market Estate Branded and Specialty Coffees India has entered the arena of Estate Branded preparations. Distinct plant strains and unique processing techniques have helped in the preparation and marketing of coffee as Estate Brands. It is an established fact that each plant strain has distinct quality characteristics. Certain estates cultivating plant materials with unique acceptable cup quality characteristics have taken to processing them with strict adherence to quality norms and are now launching them in the market as Estate Brands. Meerthi Mountains, Banangala Organic, Horseshoe Heights, Jamboor and Buttercup Bold are some of the Estate Branded Coffees, which have been prepared from distinct plant strains and with special care during processing.. Meerthi Mountains, a delicious coffee prepared from an exotic Indian strain of Sln. 9, is from Badnekhan estate located in the Bababudan hills at an altitude of 4000 ft. These fine washed arabicas are the result of care from the seed to the cup. The processing is carried out on state-of-the-art machinery and is sun dried. The beans exhibit sweet acidic notes and distinct flavour of fruit nuances in a caramel dip.
Banangala Organic is from a well-maintained estate in the region of Coorg and belongs to the progressive company of The Bombay Burmah Trading Company. The coffee is organically grown and is prepared from a distinct plant strain of BBTC Selection, comprising greenish grey, bold dense arabica beans with balanced body and acidity and an aftertaste of fruit notes laced with smooth acidity. This coffee could certainly be served black and is the first Indian organic coffee to be offered to the overseas market. Horseshoe Heights, an excellent Estate Branded Special Coffee of M/s Bettadakhan Estate, prepared from Sln.795 coffee beans, is from a high altitude estate (4250 ft.) nestled in the lush emerald valley in the Inner Giri Mountains. The purity of the plant material has been ensured with the planting of uniform and homogenous plant material of the Sln.795 in distinct blocks on the estate. The coffee is prepared by the washed method, without any chemicals or machine attrition, utilizing only an aagard pulper to remove the fruit skins, with the rest of the operations such as the breakdown and removal of mucilage carried out by natural fermentation and manual washing and finally being sun dried. Labor intensive indeed, but the intrinsic flavour notes have been preserved and highlighted by the natural methodology of selective hand picking, processing with biological degradation and drying with the help of cost effective natural sunshine! Jamboor, is a special coffee from Jamboor estate, at an altitude of 3500ft. in Coorg and owned by the well known Corporate company of the Tatas. The washed Arabica of this estate, is harvested by selective picking and is carefully processed both on the estate and at their modern curing factory, where the coffee is not only meticulously graded and stringently sorted, but also cupped to ensure the quality of the produce. This premium coffee finds favor with roasters, who follow a fast technique of roasting and the balanced body and acidity enables fine blending. Buttercup Bold, is an exotic name for an exotic robusta coffee from a small farmer in Coorg. This estate houses distinct plant material of Sln.CxR, producing bold, dense beans, which when washed, possess a grey hue with clean, soft buttery after notes in the cup. This coffee could, with ease and perfection, provide the froth and bubbles for the much sought after espresso.
India also prepares speciality coffees for coffee connoisseurs around the globe. We have the proud privilege of having launched the Specialty Coffees of Monsooned Malabar and Monsooned Robustas as early as 1972, even before the world was awake to the concept of Specialty in coffee. These delicious beans, which are of golden hue, are large in size and possess mellowness with a hint of spice, making them unique in the cup. You could use these beans in a variety of ways.a neat coffee as an after dinner drink, as a highlighter in an espresso blend or as a smooth body builder in your regular filter coffee. Added, washed arabica and robusta beans from selected coffee regions of growth and subjected to special preparation techniques have resulted in the speciality coffees of Mysore Nuggets EB and Robusta Kaapi Royale launched by the Indian Coffee Board in the 1990s. The popularity of these coffees is growing with the overseas trade. The recently introduced premium grades of Plantation AA and Robusta Cherry AA, comprising bold beans, which have been enriched with stringent quality standards are finding ready acceptance in the market.
WITHIN THE PAST YEAR, WHAT ARE THE MOST IMPORTANT CHANGES THAT YOU HAVE WITNESSED IN YOUR SEGMENT OF THE INDUSTRY
In the past year, the most important change witnessed in the Darjeeling tea industry has been the effect of the trade-related Intellectual Property Rights. Further, there has been a consolidation within the industry with change of ownerships. India has made considerable progress in promoting organic products in the international market. After having achieved recognition by the United States Department of Agriculture (USDA), we have also been able to achieve equivalence with the EU. An interim letter from Switzerland, agreeing to equivalence, has also been received and a notification is pending. This would mean that the certification bodies accredited by India will be able to issue the scope and transaction certificates to enable Indias organic products to enter the respective markets. This will bring down the certification cost for all our exporters, and lend visibility to the India Organic logo through the documents and products. This will facilitate the growth in the export of organic tea from India.
Darjeeling tea has been registered under the Geographical Indications of Goods (Registration & Protection) Act 1999, and now enjoys protection as a member of the World Trade Organizations (WTO). Geography indicates which goods, such as agricultural, natural or manufactured goods originate, or are manufactured in the territory of a country, region or locality where a given quality, reputation or other characteristic is essential and attributable to its geographical origin. Also, the effects of global warming have been felt, and unusual weather threw the normal pattern of harvesting into jeopardy. Sanjay Bansal - Chariman - Darjeeling Tea Association, Ambootia - Tea Group Exports, India Farmers are now able to sell their coffee directly to buyers overseas, as opposed to being forced by regulation to send their coffee for sale at the weekly central auction. For the last few years there have only been three interim marketing agents acting as sales agents for the farmers, but now - more or less - anyone who applies and can fulfill the application criteria is eligible to be licensed for this function. This will undoubtedly change the coffee industry in Kenya significantly, as middlemen and exporters are now able to go directly to the farmer to source clean coffee. There will be winners and losers, and we predict a fair amount of chaos, before a new status quo is reached. Many farmers, mistakenly, believe that they will achieve far higher prices if they make direct sales with overseas buyers. Others are not really aware of how the changes in the system might affect them, and what they can and cant do when going forward. There is a great need for capacity building, and education at the farmers level, so that they are aware of industry changes and are able to make informed business choices. Jeremy Block - C. Dorman, Kenya The demand for ethically and sustainably sourced coffee is increasing at a faster pace than ever. There are many different ways a company can source ethically, such as outside the box, which is being taken up by a number within the trade. This is occurring in addition to the increase of fair trade, rainforest alliance and other certified
coffees. D.R.Wakefield, as a pioneer in the ethical and sustainable sector, are well placed to source these coffees for the industry because we already have in place the direct sourcing channel -- to the farmer -- for many of our coffees. Simon Wakefield - D.R. Wakefield, UK A change that has already been underway, picking up speed, and will be with us for the next years as the single portion revolution in the in-home market expands. This applies to instant coffee, as well as filter and espresso. In the instant market we see an increasing variety of single-portion instant coffee sachets, including recipes like Viennese coffee, Cappuccino and Latte Macchiato. With the filter market, we see the coffee pads for machines like the Senseo and others really taking off, especially in Northwest Europe. In the espresso market, a variety of capsules and pads are available. What they have in common is convenience of preparation, consistency of quality, and easy and mess-free disposal of spent coffee grounds (filter and espresso pads). What they also achieve is to increase the number of drinking moments that would otherwise be lost. For example, an individual consumer at home may not want to brew an entire pot of filter coffee, but now they can enjoy a cup of coffee whenever he or she feels like it. The single portion packaging keeps coffee fresh and allows the consumer to have more taste varieties at home to choose from, or to offer friends. Roel Vaesssen - European Coffee Federation, Netherlands What stands out to me is the groundbreaking work of the International Coffee Organization (ICO). Two historic developments are the active U.S. membership and renegotiation of the expiring International Coffee Agreement, which dovetailed as a rare opportunity to recreate the organization. It opened the door to breaking with the past and crafting a modern, more efficient ICO -- a new organization that effectively and efficiently serves its stakeholders with unsurpassed value. It is a chance to empower the ICO and promote a free market environment, support sustained expansion of markets, and leverage private/public sector cooperation for the betterment of the entire supply chain Robert F. Nelson - National Coffee Association of U.S.A, New York
The coffee industry has increased the demand in training and R&D services. Our training facility and R&D are fully booked far into next year. Coffee roasters contract us to train their staff about green coffee, roast coffee and coffee preparation. On the R&D side, the coffee industry orders investigations on chemical and physical characteristics of green, R&G coffee or coffee processing which we carry out in our pilot plant. Due to the rising energy costs, potential savings in energy consumption are an important matter. The trade asks for technical solutions to reduce the required amount of energy for roasting and emission treeatment. Suitable solutions are recirculation of exhaust gases, green coffee preheating and PROFORTE (flameless, regenerative, thermal) exhaust combustion Robert Dous - Probat-Werke, Germany 2. What recent trends have had an effect on your industry, and what trends do you see developing? How will your company meet these demands? The EGCG (epigallocatechin-3-gallate [epi-gallo-cat-ekin-3-gal-ate]) is going to become BIG NEWS, and we are going to see mass publicity about its benefits. We intend on meeting the demand by providing EGCG-laden products. Barry Cooper - Cooper Tea Co., Colorado Specialty coffee becomes more and more of interest for the mainstream coffee producers. Roasting equipment needs to be highly flexible to meet the wide range of requirement in terms of taste and frequencies of blend changes. therefore we developed a revised version of our THERMA TWO roaster, which combines the roasterg systems of three different roaster types. Lot tracking is a focal point. The coffee packaging units need to traceable backwards up to the green coffee lot. In Europe, this has already become standard. Robert Dous- Probat-Werke, Germany The trends of health, well being and a more conscious intake of food and beverages, have also been prevalent this year. The consumer can choose from an ever-increasing number of products and varieties targeted at different situations or consumer demands. Data suggests that the consumer continues to make choices in order to achieve a healthier lifestyle and chooses products dependent on time and place. 1
The tea industry is uniquely positioned to offer many varieties, and play an active role in a healthy and good tasting diet. Plantextrakt is uniquely positioned to develop concepts and products for the industry, which meet these trends. The company, which is aware of the current trends, sources globally and has a strong R&D department to meet the demands of the industry for today and tomorrow. Oliver Hehn - Plantextrakt, Germany The growth of the green tea/specialty sector, and despite talk about quality, most packers remain very price sensitive. Philip Miles - Van Rees Global Accounts, UK Trend, away from the mainstream coffee to specialty coffee, means biggest variety of coffee services (pods, pads, whole bean, etc.) and overall service. The effect on our industry was that we had to adapt to smaller production capacity, which means smaller badge sizes bit with sophisticated demands regarding quality. Gustav Luehrs - Neuhaus-Neotec, Germany 3. Have you witnessed changes in the consumers tastes? Do you see any new ones developing? We are going to see a lot of functional RTD appearing in the market. They will contain EGCG and other functional ingredients. Barry Cooper - Cooper Tea Co., Colorado The American consumers love affair with tea is in a constant state of flux, moving from black, green, white, Oolong, Pu-erh, RTD, Bubble, flavored and then back again. Fickleness aside, a constant thread running throughout the search for the perfect tea is the demand for a more natural, healthier, great tasting beverage to replace whatever they are currently consuming. On the flavor front, there is a never-ending array of new options coming into the market; areas that only a few years ago no one would have ever guessed there was any kind of compatibility. Joe Simrany - Tea Association of the USA, New York
Id say consumer tastes have not merely changed, but have expanded and diversified. Consumers are reacting vigorously to the growing menu of coffee options on store shelves and in coffee shops. The more varieties there are, the more they seem to want. The NCAs market research shows an intriguing pattern of consumers that are now looking into different coffees to fill different roles at different times of the day. Coffee has become many things to many people -- a morning staple, an afternoon treat, a focus for social interaction and more. These same consumers are choosing many of the different options. In fact, theyve become so accustomed to gourmet varieties that they appear to regard them as traditional coffee, when asked to describe their consumption and purchase habits. This trend is evident in the NCAs National Coffee Drinking Trends study -- virtually all of the growth in daily coffee consumption in 2005 and 2006 has been in what survey respondents describe as traditional coffee. Robert F. Nelson - National Coffee Association of U.S.A., New York We see an increasing interest in drip coffee. Despite the continuing trend to espressobased coffee beverages, consumers have rediscovered the classic drip filter coffee. Since there is this huge hype around espresso, some consumers start t odesire a regular cup of cofee. Parallel to that, coffee drinkers demand a higher quality level for coffee consumed at home or in the office. They are used to quality espresso drinks and want to keep that level. This is a growing market for specialty coffee. Standards and rules for drip coffee preparation such as the Golden Cup have to be communicated to the end consumer to spark interest for appropriate drip filter preparation. Robert Dous - Probat-Werke, Germany 4. How does the exploding interest in Fair Trade and sustainability affect your industry? Dont exaggerate the exploding interest in Fair Trade/Sustainable coffee. There is an undeniable and positive increasing interests,. However, Fair Trade-labeled coffee still only represents 1.2% of the West European market (I dont have market shares for other initiatives like Rainforest Alliance and Utz Kapeh readily available, but these as well as
company-individual initiatives should be added to arrive at an estimate of total sustainable coffee market volumes). Having said that, the consumer does want to feel generally comfortable with all products he or she consumes, be it sporting goods, textiles or coffee. This provides the raison dtre for a base-line standard like 4C, which will become operational in the beginning of 2007. Its development and the benefits it provides to the growers, in terms of market adaptation and resilience to changing market conditions, will be one of the most exciting trends to watch in the coming years. Roel Vaessen - European Coffee Federation, Netherlands The most striking thing that has happened in the past year is the increasing public demand for Fair Trade and organic coffees. In fact, people seem to be saying What the heck, if Im going for Fair Trade, I may as well go organic too. So we see this trend of consumers combining the two concepts in the same purchase. Stuart Daw - Nationwide Gourmets, Florida, U.S. Positively -- and to a large extent. The standards implemented try to improve the best practices at the farm or smallholder level, whether economic, social or environmental. However, they do raise the expectations of the farmers and create a certain amount of confusion. The farmers are overwhelmed with the number of different possibilities, and within the smallholder sector there is a great need for capacity building to help them overcome the challenges of implementing a certification program. The farmer is also disillusioned when, having gone the extra mile, his coffee is not bought and he does not receive the promised premium. Jeremy Block - C. Dorman, Kenya Although the benefits that Fair Trade programs can bring to the environment and the employees, through social programs, and the best management practices are unquestionable, with some exceptions, they dont address two crucial points: The necessary long-term contract guaranteeing a premium over the market price for the farmers involved, due to the investments that comes with the Fair Trade principles.
Lack of better information towards the consumer, to motivate them to pay a better price for Fair Trade products.
Joaquim Leite - Coop Guaxupe, Brazil 5. Do you think companies/organizations are succeeding in educating the consumer about the different origins and blends? I believe the entire tea industry is doing an excellent job in educating consumers about the nuances of specialty tea. That said, there is much more that needs to be done before American consumers will develop a deep appreciation for the variety and complexity of the types of tea available from around the globe. The Specialty Tea Institute is also doing its part by expanding its Certification Program to include an appreciation for single origins, regionals, seasonals, and Estate teas. Joe Simrany - Tea Association of the USA, New York Definitely! When talking about education on coffee, different origins and blends, it would be unfair not to mention Starbucks, as nowadays an increased number of people look for specialty coffees and are trying to learn more about it. As producers, we perceive the evolution when we have specialty requests from buyers, such as larger screens and cup profile. Four years ago, for example, Daterra developed a Green Coffee Menu, where the client would choose their coffee among 18 blends that were all not only produced at Daterra, but were of single origin and under a brand. At the beginning, the client would give the specifications and we would fit it in to the menu, now 100% of Daterras clients already asks for one of the brands. Educating consumers not only about quality, but also about sustainability, has been paying off. There are some countries that simply dont buy coffee without a certification. Quality and sustainability are becoming a premise, not a differential. Isabela Paschoal - Daterra, Brazil 6. What developments/changes do you feel need to be made in your segment? How will this affect/improve the industry as whole?
We need to continue to strive for quality, and never rest on last years products. Innovate, develop and prepare amazing beverages in new ways with new flavors and recipes. We continue to look at the developments in the restaurant trade (from QSR and casual dining to fine dining) to evaluate the trends and implications of specialty coffee beverages. Spencer Turer - Kerry Food & Beverage 7. In what direction do you see the role of the barista going? The Barista is the face, personality and sole representative of the specialty coffee supply chain to the consumer. They not only can make drink suggestions or recommendations, but their skill can be the difference between an everyday latte or an amazing specialty coffee experience. The passion, skill and commitment of great baristas must be recognized and rewarded. Today, with resources and contests, such as the Barista Guild of America and the United States Barista Championship, there are opportunities for a barista to learn and grow professionally.
Questionnaire
1. Please select your preference of hangout places: a. b. Pubs c. Restaurants d. Fast food joints e. Coffee shops f. Movie theatres g. Others 2.
3.
Who/ what influences your above decision? (Please tick one) a. Friends b. Kids c. Spouse d. Advertisements e. Happy hours / discounts f. My own choice
4.
5.
6. 7. What factor have you considered while answering the above question? a. Cost b. Accessibility c. Taste d. Lifestyle e. Availability of time f. Social needs g. Variety
8.
10.
Which is your favorite coffee bar? a. Barista b. Nescafe caf c. Caf Coffee Day
Results
1. Favourite hangout places:
FIG 1
movie theatres others 5% 14% coffee shops 19% pubs 14% restaurants 24% fast food joints 24%
Most of the people i.e. 25% prefer restaurants and fast food joints. 2. Who/ what influences your above decision? (Please tick one)
F 2 IG
D C UNT IS O AD R IS NT VE T ME S OUS P E K S ID F IE S R ND OHR TES 0 2 4 6 8 R S ONS S EP E
BOTH 35%
Most of the people prefer to drink outhouse or both in-house & outhouse. 4. What factor have you considered while answering the above question?
Preferences
No restriction on time one can sit at the coffee shop Ambience Happy Hours Music Seating Capacity Free offers/ Promotional Programs
s r o t c a F
Response 2
Consumers Employees
FIG 4
Most of the employees think quality services, ambience, variety of services offered but according to customers its the dcor, ambience and the no restrictions of time.
FIG 5
DATE 25% FRIENDS 55% FAMILY 10% BUSINESS 10%
Most of the peoples decisions are influenced by their friends choices. 6. Which is your favorite coffee bar? Factor Quality of Service Speed of Service Variety in Offerings Price Location Dcor Free offers/ Promotional Programs Barista 5 5 5 1 5 5 4 FIG 6 Caf Coffee Day 4 4 4 5 3 4 5 Caf Nescafe 2 1 1 2 1 1 1
The initial variables used for analysis were identified through focus group interviews. For the sake of convenience, the sample for this was restricted to the inhabitants of the campus of IHM Goa. This might be seen as bringing about a certain amount of selection bias in the subsequent findings;
The paucity of time has been a limitation Due to busy schedule of staff, they were not able to give enough time and hence not provide enough information.
CONCLUSION
The coffee bar culture has till date been more or less restricted to the metros. Also, a distinct trend can be seen in the clientele the various coffee bars have been attracting over the years. The pricing, promotion and ambience of the outlets have been seen to be targeting this very particular section of the society. With time, the coffee bars will feel the need to spread to smaller towns and cities. This will definitely necessitate a change of image for them. Advertising, promotions and pricing will need to be altered to target a newer group of clientele. At present, the campaigns seem to be successfully targeting the Type B clientele, as identified in a preceding section; however, this has been at the expense of alienating the other three groups. Type C & Type D consumers would need a far different approach. These two customer segments are yet to be tapped into, and targeting them would inevitably lead to an expansion of the market. In fact, any bar that re-orients its processes to accommodate these two segments will enjoy a first-mover advantage, and will definitely enjoy and advantage. The caf coffee day chain has taken a move in this direction, by pricing their offerings on the lower end of the price spectrum. Type A: Regular Coffee Drinkers: They look for good coffee, constant taste, where they can savour their coffee. Location, Decor and Time are the factors that influence them so that they can peacefully enjoy their coffee. Type B: Outhouse Coffee Drinkers: This is a group of people who perceive drinking coffee as a means of making a statement. They would like a place that is trendy and can enjoy time with friends. A place which has good seating capacity and ambience and they can enjoy the kind of music played over there. Type C: In house drinkers These people are not the normal outgoing kind of people. They have a close circle of friends with whom they like to spend their time. They will visit a coffee shop for the quality of service and the various promos offered. Type D: No Coffee Drinkers These people can be dragged to the coffee shop by various promos and promoting the coffee bar as an experience. 8
RECOMMENDATIONS
Considering the above factors for targeting the different customer segments will aid the coffee bars in designing services and promotions that are much more effective. The 9
above factors attain an added relevance when seen with the backdrop of the findings of our study. It is apparent there is a significant disparity in the perceptions of the employees and the customers. In the absence of any viable way of measuring what a customer seeks, the various coffee bars would do well to rely on market research studies such as this to improve their services. Moreover, the preferences and needs of consumers are subject to change with time. In order to remain competitive, one needs to constantly gauge the pulse of the market. Timely market research studies such as this can prove to be a vital tool in this regard.
BIBLIOGRAPHY
Coffee Consumption in Urban India: 2001, Coffee Board of India The Book of Ingredients 10
www.cafecoffeeday.com www.indiacoffee.org www.koffeekorner.com www.theshoppingplace.com www.yellow-net.com Hammer Food & Beverage Business Review (Dec-Jan 05) Food & Beverage News (February 16-18 2005)
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