While many of us do recall soundbites of the former Chairman and CEO of Nestlé about water, it should probably be noted that he is no longer in either role and is not a member of their Board of Directors. The new CEO (Mark Schneider) was brought in as an 'outsider' and while he also remains under some activist investor pressure is making some effort to clean shop and modernize their business. I'm interested to see what comes of this, and particularly whether Blue Bottle can actually benefit from Nestlé's technical expertise in coffee, which so many of the 'third-wave brands' struggle with.
Nestlé Takes Majority Stake in Blue Bottle
71–80 of 144 posts
Re: Nestlé Takes Majority Stake in Blue Bottle
#72As this thread will ultimately will end up discussing the corporate evil that Nestlé apparently is, I want to, for the sake of the discussion, point out the reasonableness of the CEOs statement regarding water as a human right: He argues water should have a market value so that it is treated more like a resource that should be well managed. Of course a state can also do this and in my opinion should, but of course as…
And I don't get exactly what it means to declare water a human right. There are certainly people in the world not getting the clean water they need. But how do you solve this? You set up an international agency to acquire water for them. But where do you get the funding for this agency? If it really is a _human_ right, is this agency above local laws? What are the restrictions on this agency? Can this agency ban the…
I don't get exactly what it means to declare water a human right
It's not particularly meaningful to say that water is a human right. Far better to talk about obligations. Who has the obligation to provide people with access to clean water? That is where the discussion can begin.
I would argue that whoever controls access to clean water should be the first to answer the question of obligations. If those who control water refuse to provide it to those in need, why should we allow them to control water?
Re: Nestlé Takes Majority Stake in Blue Bottle
#73As this thread will ultimately will end up discussing the corporate evil that Nestlé apparently is, I want to, for the sake of the discussion, point out the reasonableness of the CEOs statement regarding water as a human right: He argues water should have a market value so that it is treated more like a resource that should be well managed. Of course a state can also do this and in my opinion should, but of course as…
Small nit, some folks without water for 'gardening' can't live. See some of the city farms for examples of this.
It might be cheaper to give them water and food for consumption instead of water for highly inefficient 'gardening'.
Re: Nestlé Takes Majority Stake in Blue Bottle
#74That's a major bummer. Nestle is one of the most evil companies there is--their CEO once said water isn't a human right. Nestle uses cocoa from slave labor and bottle water in drought stricken communities and national forests on expired permits, and do shady stuff like hiring the regulator who gave them their water license. Very few companies are as vile and amoral as Nestle. Unfortunately, this will taint Blue Bottl…
Counterpoint: Saying water isn't a human right is different than saying not everyone should have access to water. I generally agree that water isn't a right. I think it's a misuse of the word "right" and a misapplication of the concept of a "right". Rights define what you're free to do for yourself, and the various ways in which those freedoms can't be infringed upon by others. For example, you have a right to free s…
I think the key point of contention is about rainwater harvesting.
Making rainwater harvesting illegal (and thus forcing people to overpay a monopolized water system) is arguably a violation of human rights. It is a prohibition of what you are 'free to do for yourself', that forces people to pay for something they need to survive (and could otherwise get for free).
However, I agree on the haziness around the issue. Mandating that everyone receives X amount of drinkable water may be expensive to implement, economically unsustainable and create perverse incentives.
Re: Nestlé Takes Majority Stake in Blue Bottle
#75Good coffee does not scale.
I think it's reasonably fair to say that so far it hasn't, but could it? If not, to what would you attribute the fundamental roadblock? I'd argue consumers themselves, but I don't know if that's really just a cop-out or not.
Even if you buy the best X% of a crop, as scale increases, quality will go down.
Unless a significant portion of profits are directed towards the improvement of farming methods, scale tends to decrease quality.
Re: Nestlé Takes Majority Stake in Blue Bottle
#76There's a great episode of the Startup podcast (which is generally quite good, particularly the early seasons) about one of the artisanal coffee producers that sells to Blue Bottle:
https://gimletmedia.com/episode/building-perfect-cup-coffee/
Re: Nestlé Takes Majority Stake in Blue Bottle
#77Earlier quoted context omitted.
I think it's pretty clear that the article intends "rapidly expanding niche" to refer to all of "third-wave specialty coffee," not just Blue Bottle.
That is still hard to fathom 20% of coffee sales
I agree with this. Think of the mid to low-tier restaurants and the coffee the serve.
Unless I'm in some big city, most of time I'm just getting whatever bulk coffee they happened to buy from some wholesaler. They arent serving me $18/lb coffee from some boutique farm in Nicaragua.
Re: Nestlé Takes Majority Stake in Blue Bottle
#78Earlier quoted context omitted.
I think it's reasonably fair to say that so far it hasn't, but could it? If not, to what would you attribute the fundamental roadblock? I'd argue consumers themselves, but I don't know if that's really just a cop-out or not.
Even if you buy the best X% of a crop, as scale increases, quality will go down. Unless a significant portion of profits are directed towards the improvement of farming methods, scale tends to decrease quality.
Are you saying that supply can't scale to demand? Because what you've described, a limited supply and increasing demand, is commonly solved by increasing supply. Unless we're at 100% coffee output for the Earth, which I don't think we currently are.
Re: Nestlé Takes Majority Stake in Blue Bottle
#79Earlier quoted context omitted.
rather have underpriced water be available to people for gardening, washing cars, swimming pools than it be given away for free in corrupt government contracts to a mega-corporation so they can grow rice in the California desert or bottle ground water and sell it at inflated prices.
You didn't hear it from me, but the first person to make a market for water futures will be very wealthy.
there's no Cushing, Oklahoma for water. most water delivery dams, pipelines, plants are owned by govt entities and are vertically integrated to serve a particular locale. Theres not often ways to switch delivery and commercialize it.
the closest analog is the Colorado river basin but the various state's government agencies sort that out themselves without the need for intermediary market markers.
Re: Nestlé Takes Majority Stake in Blue Bottle
#80> The rapidly expanding niche accounts for 15 to 20 percent of coffee consumed in the United States, according to the Specialty Coffee Association. One in every five or six cups of coffee is Blue Bottle or "third-wave specialty" coffee? This simply can't be true considering the scale of Starbucks, McDonald's, and Dunkin' Donuts, let alone brewing at home and coffee consumed at diners and non-specialty restaurants. I'…
This is very surprising, as last time I did research on this subject I remember seeing that Starbucks alone owned 40%+ of the "single cup" coffee market share. The runner up was the McDonalds/Duncan "lower end" group of coffee sales.
Specialty coffee was great for the margins, but the market-share was not even close to the numbers being reported in this article.