17/05/2018 by Game of Perception 0 Comments
Game of Perception
Adi Taroepratjeka was not your usual Q-Grader (a licensed person who’s capable of examining and scoring Arabica coffee objectively), he was the first person in South East Asia with Q-grader instructor license, he’s the judge for coffee competitions, he was also the host of Kompas TV’s “Coffee Story”, started from 2011, right before coffee was cool. The last time we met him in person was in Jakarta 2013. When we decide to do special coffee issue, we know we have to meet the man, even though now he’s in Bandung, running his own coffee lab, also a coffee shop, 5758 (read: Maju Mapan).
The thing about Adi, is he’s probably one of the most critical person in coffee. In fact, he doesn’t like to be bound by rules or belief, especially if he believes them to be wrong. For example, 3rd wave people believe robusta sucks. However, Adi said that many of 5758 customers would go home if they find that his robusta hopper is empty. When he offered me to try his double ristretto Robusta from Banyuwangi, who am I to turn down his kind offer? To my surprise, I tasted
acidity, some umami, peanut-butter like notes, with sweet after taste. Honestly, it was the first time I taste Robusta this good. With coffee in hand, I finally ready to do a long discussion about “the ideal” selling price for coffee, his current activities in education, coffee trend, to his passion in
enjoying instant coffee sachet.
I knew you when you run Java, your former coffee shop in Senopati, Jakarta. What was the story back then?
It was my experiment while I was also running consultancy business. I was curious how to set-up manual brew bar. There are many valuable lessons there, for instance, you can’t sell coffee too cheap because people automatically think it sucks, it’s easier to fool customers by selling low quality coffee with expensive price tag.
At the time, I sold the coffee Rp 10.000-15.000. I was itching to hear Indonesia is producer, but the consumption is still low. People always say our good stuff is always exported, when in fact, it is not. I think it’s wrong if people are waiting for discounts from credit card to buy coffee. People also say don’t drink instant
coffee sachet, but when you sell it for Rp 5.000 and the one in coffee shop is Rp 35.000, people will opt for instant coffee, the difference is obvious.
After some reading, if you visit US or Australia, a cup of coffee is cheaper than a lunch meal. 1 glass black coffee in Australia is $3-4, and milk-based is $4-5, meanwhile in KFC, you have to spend minimum $7. In Indonesia, black coffee is around Rp 30.000-40.000, milk-based is above Rp 40.000 , but you can get Nasi Padang for less than Rp 30.000. Which one will you choose? Definitely Nasi Padang, right?
So there was wrong perception about the ideal coffee price?
No, if you look at the investment for coffee shop, not cheap man! Even if they sell a cup for hundred thousand rupiahs, I don’t see how they’ll get the ROI within 5 years. Most coffee shops in Jakarta used coffee machine worth Rp 200-300 million, grinder for espresso Rp 80 million, grinder for manual brew Rp 40 million. Not to mention the water filter, super fast wifi, kitchen set up, and other things. Crazy!
On other hand, if you sell coffee for Rp 40.000-100.000, how do you convince people to have frequent purchase? If you wish a customer to return once a week and drink 2 cups, or 8 cups in a month, you’re not making any money man!
I think the number sounds good already, some coffee shops were visited once by customers for photo update in social media.
Yes, I’ve been to a popular coffee shop in Jakarta, there’s customer order latte art, took photos, and leave the coffee. I thought, should I drink the coffee (laugh)? So, I can’t say it’s wrong, but everything has its own calculation. To me, in order to get profit and get ROI, coffee shop must do volume.
How did you open up this 5758 Coffee Lab?
Actually, I’ve been dreaming to make a training facility. We saw how the coffee industry in Indonesia grow so fast, but education is expensive, and the one who attend the class is mostly the owners. Most owners are not involved in the operational, so they’ll give partial knowledge to their staffs. They’re afraid when the staffs became smarter, other companies will recruit them. In the end, we were thinking ways to offer affordable education.
How much do you mean by affordable?
The classes in 5758 starts from Rp 350.000 for half-day class (3-4 hours) to our most expensive one, International Q-Grader certification class, for Indonesian is Rp 16.000.000, and $ 2.000 for foreigners. It’s relatively affordable because if you take the same class in Singapore, it will cost you at least $ 2.500 - $ 3.200.
Please note that we want to offer affordable education, not cheap, because there will always be something cheaper. In our place, the theory is only 20%, the rest would be practical. For 2 days class with 10 students, we spent around 14 kg coffee, 450 l water, 150 V60 paper filter, 120 flat bottom filter.
We offer exponential learning, we encourage students to make mistakes, because people learn from mistakes. Don’t expect us to give you bible about the right way to brew coffee. Right or wrong is relative, you make the same coffee to customer A and B. Perhaps A like it, but B doesn’t. Barista’s job is to tell customers’,
preference, adjusting the brewing method to make them happy, because at the end, the one who actually pay for baristas’ salary is customer.
You said coffee shop must play by volume?
Yes, simply put, if our internal consumption is low, all of the coffee is exported, it means the fate of the farmers will be determined by international price. If we have strong internal consumption, the fluctuation of the international price won’t affect the local price too much. If you want to help coffee farmers, just raise
the internal consumption, don’t always buy imported bean, but I have to admit, Indonesian coffee is very expensive. The obstacles come from infrastructure,
land productivity, and copy paste attitude. Some friends even opt for imported bean because the price is similar to bean from Aceh, but it’s easier to sell
these imported bean.
Are we not efficient in production?
For example, let’s take Myanmar who’s still learning to produce coffee. From 1 hectare land, you can produce 1,5-2 tons of green bean. In Aceh, the production may reach 3,5 tons/ha, but still in cherry format. From cherry to green bean, the maximum production capacity of green bean would be 600 kg/ha.
We have many factors that cause this. I have a coffee farmer friend in West Java who had difficulty in finding fertilizer for coffee tree. He was even arrested for buying subsidized fertilizer for agricultural, meanwhile coffee is in plantation category, using land intended for forestry, it’s a bit complicated.
The second obstacle, human resource. Indonesians think farming is obsolete. The youths prefer to come to cities, becoming labors or servants instead of farming, it happens all around Indonesia. In harvest time, farmers have to pay for daily workers from other regions for Rp 115.000/day, or when it’s harvest time in one’s farmer, farmers from other plantation will work as daily worker, and when it’s other farmer’s harvest period, it’s the other way around.
Geography also matters, in regions farther from the equator, they don’t need to grow the tree on mountains, hills will do just fine. It means, they can use mechanical equipments like tractor. In Indonesia, the tractors were toppled over due to the terrain. When we finally got the tractors in West Sumatera, the tractor is
specifically designed to plow rice field, useless in coffee farm.
And then the copy paste attitude. There once a rising bean from a famous plantation, the price escalated to, let say Rp 500.000/kg (green bean). Then the neighboring farmers will also raise their price for, let’s say Rp 450.000, but quality is different.
Many Indonesian baristas claimed that we have the best bean, is it how the world feel too?
What’s the definition of “best”? If we talk gudeg Jogja vs Solo can even start a new war.
But as a Q-Grader, you can give scores.
Yes, but in this case, scores are just description of quality, we’re not talking about taste preference. Scores should be supported by data about the flavor notes. Let say we have 2 bean with the same score: 85, the processing for the first one is natural with notes like fruity, jam, honey, sweet, meanwhile the full wash bean will have cleaner taste, dragonfruit, guava, lemon, apple notes, can I sell both bean to just anyone? There will be those who prefer acidic bean like you, but those who dislike acidity will opt for the natural bean. So, even though the both have the same score, it doesn’t mean everyone will enjoy them, it depends on the flavor
People shouted proudly, “coffee from my region is the best!” When asked, did they ever have bean from another continents? No, then what does the best means? When we heard our coffee is imported to Germany, or bought by Americans, as what? Blend? Filler? Does the origin appear? Not necessarily.
The problem is, not everyone has the luxury to taste bean from all over the world. There was a period in Jakarta where every modern coffee shop offers bean from Nylon (Singaporean roaster) and they tasted sour.
You mean sour, not acid?
Not acid, to me it was sour. Does it suppose to taste like that? When I finally got the chance to visit the roaster in Singapore, the coffee was not sour. Why? Because we use different water, or different brewing method. If I have the most expensive bean in the world, it won’t be good if I brew it wrong. I have this robusta, the underdog bean, If you know how to tweak it, you’ll drink it easily.
Sometimes we stick to the best. Let say I use bean from Puntang that was drank by Jokowi, which was worth Rp 600.000/kg of green bean, it’s green bean we’re talking about! Will it be delicious? Not necessarily. Does Jokowi actually drink the Puntang coffee? No. When people are happy with the brand, the demand and the price escalate.
We love to copy paste. Just look at Kelapa Gading, my friend did a survey and he found out there are 40 modern coffee shops there, BSD has 38, Yogyakarta has 200. Crazy, isn’t it? However our consumption rate is going nowhere, it means there’s something wrong, at least for me.
Did you often find Indonesian bean abroad?
I have an obligation to visit US every 2 years to do calibration, also to extend my instructor license. I was curious, does our bean really that popular? I visited San
Fransisco, Portland, and LA’s suburb, these are 3 coffee cities in US, aside from Seattle, of course. Actually, it was difficult to find Indonesian bean, I found it in relatively old, let say, 2nd wave, coffee shops. The 3rd wave one is all about beans from South America or Africa, because they have different character.
Months ago, some roasters from San Fransisco and Portland came here for vacation, also for trip to coffee plantation. My friend accompanied them, the input he had was: due to huge number of bean selection, they got confused. When they found the one,bought, and fell in love, they couldn’t find the same bean. I personally knew some foreign roasters, they said the same thing, the quality is not consisten. Let alone foreign roasters, even local roasters agree.
There was a period where everybody is roasting coffee from Sapan, until at a point, the quality drops. The main cause is, when a coffee collector from a region had escalating demand, he had to collect coffee from more farmers in nearby plantations. It means, the quality won’t be as good as he could maintain. On the other hand, if you go to many coffee shops and find the same bean, it’s not special anymore. Yes, the taste varied, but as customer, wouldn’t you think, “that bean again, do you guys have other?” Then we had a period where every coffee shop served bean with natural process, and then the ice coffee milk trend. It’s the problem, we love to imitate, but hate to innovate.
Americans know Indonesian coffee as Mandheling, the more modern people will look for Gayo or Java, actually we have much more than that. Why only 3 origins? Because in exhibitions, the one who promote those bean came from Medan and Java. Indonesia has enormous selections of bean, bro!
What’s the cause?
One thing I notice when we have trade missions abroad, let’s say like Indonesian booth in SCAA’s (Specialty Coffee Association of America) event, I’ve never been there, I only know form Twitter, internet, and words from friends, so I might be wrong, but it’s as if Indonesian booth came together to sell their own products.
Now, BEKRAF (Creative Economy Agency) is running a campaign that when we talk about Indonesian coffee, the term used would be kopi, K-O-P-I. We’re trying to change the branding to show that Indonesia is not just about Mandheling or Gayo, Indonesia is big, and the one word that put us together is kopi. Initially, the campaign would start as “Back to Java”, we’d like to introduce variations of Javanese coffee, but people from Aceh, Medan complained.
How do you describe the difference between Bandung coffee scene and Jakarta?
Until February 2018, Bandung has over 500 coffee shops: 100 modern coffee shop, the rest are manual brew shops. To me, one of Bandung’s greatest success story is Bandung Brewers Cup (BBRC), a competition held by manual brew community. It’s been 3 years and because of the warm welcome, each year the number of participants gradually increased. In November 2017, we add the number of competitor to 96, but the enlisting ended within less than 30 minutes. They came from Aceh, Borneo, Yogyakarta, Jakarta, some barista from Bandung even missed the chance.
Whenever BBRC, I assure you that 5758 will be closed down because our equipments and baristas will be there. The event never has major sponsor, each of Bandung’s coffee shops give Rp 500.000, of course we give booths to sponsor worth Rp 5.000.000-10.000.000, but still, the biggest fund came from local coffee shops. The funny thing is, we often lend milk and coffee to each other. 5758 often acts as Greenfield’s (milk) retailer. We buy for Rp 17.000 and sell it for Rp
18.000. Many smaller coffee shops that can’t afford buying large quantities came here, because otherwise, they have to buy it in supermarket with much
higher price. These kinds of teamworks made me fell in love with Bandung.
Throughout your career as consultant, what are the most frequent mistakes made by coffee shop owners?
First, distracted by equipments. Expensive equipments doesn’t equal good cup of coffee. In some cases, people want to use expensive machines, with cheap bean, but they want to sell it with premium price, as a result, customers are not going back. The second, impatience to open new outlets or think their brand can be easily franchised. Making a coffee shop is easy, the difficult part is maintaining it, monitor it day by day.
To stop investors from buying expensive equipments is very difficult. I even gave the ROI simulation that will take longer using expensive equipments. Many people make coffee shop by imitationg the equipment of a successful coffee shop. Have you ever heard, in addition to the mandatory La Marzocco or Slayer, the next condition to be met by a coffee shop is having its own roaster. Many have bought Probat (coffee roaster), but how crowded is the coffee shop?
If we talk about business, people often ignore the calculation. Many baristas became consultants but they have no idea to calculate the ROI. They just know the brand of coffee machine they previously used, the coffee trends abroad, but they don’t recognize their target market’s behavior, taste preference for food and drink, the estimation of guests per day, the duration of the rent, because of course, we expect to get the ROI before the rent period ends, right?
How do you predict the future coffee trend? Some people are trying to prevent customers to return to instant coffee…
What’s wrong with that, tell me? We had a student who said that instant coffee is rubbish. Let say, Kapal Api, which you call rubbish, is closed down, how many millions of people or farmers will lose their jobs? Let’s talk about specialty coffee which only had 5% of the market share from total coffee production. Why? Specialty is the result of bean sorting, meanwhile the bean which don’t make it so specialty category has to be sold also. The worst quality bean will end up at the hands of local, wet market roasters, big instant coffee makers won’t use it. Big companies has a corridor for the quality standard that has to be followed, the
key point of instant coffee is its consistency.
On the other side, I’m very sure the people in Kapal Api must have been thinking to get into specialty market, but they haven’t do it because they won’t make as much profit as they have now. They realize they are stuck in a period, and they’re trying hard to catch up. When they finally decide to enter the specialty market, half of the current coffee shops will be history.
Before launching, mass products will conduct big market research with, it’s the fund I don’t have. So, the easiest way for me to understand local people’s taste preference, is through these instant coffee sachets.
Whenever a friend went abroad, I always ask for the local Nescafe 3 in 1. The same product made in Indonesia, Singapore, and Malaysia is already different. Indonesia has the sweetest taste, as opposed to Malaysia, Singapore has more coffee in it. Nescafe in Phillipines has very tasty milk, in Yunan, it’s not sweet, it even has coconut notes. The same goes with Milo in Indonesia and Malaysia, you can tell the difference, right? They have strong R&D, but sometimes we are too
arrogant to realize that these instant coffee sachets can give us inputs and lessons. If you drink both instant coffee and specialty, which one will be
better in representing taste preference of local palate?
The market share of specialty coffee is 5%, globally. It might be lower in Indonesia. If we talk about specialty coffee shop, does the green bean is 100% specialty? Not necessarily. At the end of the day, specialty is the most misused word in coffee industry.
Will the trend collapse? Hopefully not, but we still have that tendency. When people invest big money and it was considered normal, at one point, people will feel that the billion rupiahs investment in this business will have slow return and smaller than expected, if it keeps on going, perhaps the trend will collapse.
Some 3rd wave people blame the ice coffee milk trend for bringing the coffee level back down.
Simply put, it means your customers aren’t ready yet for 3rd wave, they don’t understand not care about 3rd wave. Aside from that, it also means your
business is not sustainable. Then, why do you run the business? For profit or satisfying your ego? There’s a fine line between idealism and stupidity. If
you’re making money, you’re an idealist, if you lose money, then you’re stupid.