231–240 of 386 posts
Did I miss something in the article about how this was a grift? While these guys feel like they were screwed, and sure, they might have been screwed, making an order and then cancelling it isn’t a grift. No one stole from them, and I’m not sure how the multi-billion dollar grocery distributor got any financial benefit from the whole episode.
Great to see that all of these got sold! The numbers in this story don't exactly line up, in a way that tells a fun and clearly stressful story: (The cases have 6 bags each.) The intro to the blog post mentions 34k bags of coffee actually made. The initial order was thought to be 6k bags of coffee, but was actually 6k cases = 36k bags of coffee. So it looks like some got sold off between the delivery fiasco and the b…
I am guessing the reason this coffee went fast is because it was a good price and the good sob story. Hard to imagine they can continue to pull that off. Fool me once yada yada
It’s almost a half a year old coffee (time since roast), a great part of the flavor has been already lost. We also don’t know how it has been stored, temperature will also affect the quality.
here’s a very deeply technical explanation of this, right from the source (SCA): https://sca.coffee/sca-news/podcast/81/the-science-of-coffee...
just a small part: “A lot of volatile compounds that escape from coffee after roasting is about 1000 compounds identified in coffee and out of those, 50 compounds are important for the aroma of coffee.
[…]
So, when we look after one month some of the compounds like this one Methanethiol ends up at less than 10% of what we had in the fresh coffee, but also others they behave very differently. This is means that the relative composition of the coffee changes with time. ”
there’s a lot more fun stuff in there for the coffee enthusiasts.
Inventory financing is a severe pain in the ass for small businesses. It makes moving up to the next level incredibly difficult. Math example: You sell something for $20, and it costs you $5. You have free shipping, which costs you $3. Shop and CC fees are maybe $2, so you're netting $10. Then taxes means you net $6. So if you sell 10,000 units you've netted $60k. But to make that $60k you need to spend $50k up front…
Let's say you're moving 10,000 units per month.
You buy the stock for $50,000, get it delivered for $2,000 and store it for $1,000 - so you had to get an investment of $53,000 to set the business up.
You sell the stock for $200,000.
Making those sales, you spend $30,000 on shipping, $20,000 on credit card fees, and $40,000 on sales tax (assuming your "taxes means you net $6" means your country has a 20% sales tax which you included in your $20 selling price)
At the end of the month you owe your investors $53,000 and you've got $110,000 of cash. You've basically doubled the initial investment in a month? That doesn't sound unprofitable to me, that sounds incredibly profitable.
Great to see that all of these got sold! The numbers in this story don't exactly line up, in a way that tells a fun and clearly stressful story: (The cases have 6 bags each.) The intro to the blog post mentions 34k bags of coffee actually made. The initial order was thought to be 6k bags of coffee, but was actually 6k cases = 36k bags of coffee. So it looks like some got sold off between the delivery fiasco and the b…
The leftover bags are decaffeinated.
When I was homeless, I found a job with a "call center". Our training consisted of teaching us the cover story and how to handle reactions to it. We began with a joke involving alcohol. Then if they didn't hang up we launched into the pitch: "We just lost our lease on our warehouse, and we've got to move all these pens. You can get them imprinted with your name and phone number for a bargain. What do you say?" I quit…
I am curious about the joke involving alcohol.
Others have pointed this out, but no one has actually done the math yet, so... 6000 "units" for $250,000 is $41/unit. At wholesale. For a product that retails for $16/bag. It is just inconceivable that no one noticed this discrepancy. This is not a "grift" by the distributor, this is an elementary and obvious fuckup by the producer. In fact, it's so elementary and obvious that it would not surprise me a bit if this w…
Others have pointed this out, but no one has actually done the math yet, so... 6000 "units" for $250,000 is $41/unit. At wholesale. For a product that retails for $16/bag. It is just inconceivable that no one noticed this discrepancy. This is not a "grift" by the distributor, this is an elementary and obvious fuckup by the producer. In fact, it's so elementary and obvious that it would not surprise me a bit if this w…
> June 2022 comes, and the orders for this retailer start coming in from the distributor. This coffee was shipping to five distribution centers so we were receiving multiple orders. The orders were large but we thought we could handle it. Then the orders kept coming, spread apart by days.
So it sounds like they had an initial agreement for 6000 units, but the actual purchase orders were coming in piecemeal.
There's no question that these business owners made some stupid mistakes and probably failed to read the fine-print. On the other hand, when you are a small business looking to grow, you learn as you go along. And oftentimes you have about zero leverage with a multi-billion dollar distributor or a supermarket. You can't really ask them to change their legal terms from their boilerplate language because fuck if they are going to get their lawyers involved to change boilerplate documents at the request of a new manufacturer fulfilling a tiny order [1]. So you sign anyway and hope for the best.
[1] Reminds me of my friend who got a lucrative job offer from a large investment bank out of college, but wanted to adjust the terms in the non-compete section of their contract (something you hear suggested a lot by people here on HN). They literally laughed at him when he suggested it and said something sarcastic along the lines of "yeah, let's phone our legal team and tell them that the first year analyst wants a personalized job contract".
Others have pointed this out, but no one has actually done the math yet, so... 6000 "units" for $250,000 is $41/unit. At wholesale. For a product that retails for $16/bag. It is just inconceivable that no one noticed this discrepancy. This is not a "grift" by the distributor, this is an elementary and obvious fuckup by the producer. In fact, it's so elementary and obvious that it would not surprise me a bit if this w…
The businesses entire pitch is ethics, it would be batshit crazy to try and run such a gambit when ethics is core to their business.
Earlier quoted context omitted.
> It's 101 that wholesale buyers order by the case and for producers to specify the casecount and price, Not sure why you're being downvoted because thats standard in wolesale. Not sure how they couldn't catch that when looking at the price either. Maybe they thought they'd sell a lot less for the same price and aren't talking about this?
I don't understand either. They sell for 50% off right now for 42 a case, meaning normal price was 84. 84 × 6000 = 504 000 This doesn't add up with the 250k they were hoping for and the 50% off. Or am I wrong? (too bad they only have decaf yet, wouldn't have minded to try.)
https://bellwethercoffee.com/blog/how-to-start-selling-whole....
Earlier quoted context omitted.
> It's 101 that wholesale buyers order by the case and for producers to specify the casecount and price, Not sure why you're being downvoted because thats standard in wolesale. Not sure how they couldn't catch that when looking at the price either. Maybe they thought they'd sell a lot less for the same price and aren't talking about this?
I don't understand either. They sell for 50% off right now for 42 a case, meaning normal price was 84. 84 × 6000 = 504 000 This doesn't add up with the 250k they were hoping for and the 50% off. Or am I wrong? (too bad they only have decaf yet, wouldn't have minded to try.)