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The Gulden Coffee Story

GÜLDEN Coffee | November 7, 2007

In 2002, I brought my husband Cem to visit the coffee regions of Colombia where I grew up. Traveling through these rural areas was like taking a journey back in time. The regions are unspoiled by modern development. Coffee growers tend to their crops with deep devotion, following a process that has been handed down for generations. When we witnessed the age-old tradition where beans are hand picked, dried in the sun, and oftentimes taken to market by mule, we knew we had found our calling and established GÜLDEN Coffee in 2003.

We understood the enormous risks of entering the coffee business, in which giants like Starbucks and Dunkin' Donuts dominate the retail business. Although friends expressed disbelief that we would engage in such an endeavor, we were undeterred—driven in part by a need for work, despite our respective degrees and advanced studies in business administration and computer science. Cem and I knew we had the business sense to build a company. Moreover, we shared a passion for coffee rooted in his upbringings in Turkey and in the fertile mountain valleys of eastern Colombia.

I was born and grew up comfortable in Cali, Colombia studying at a private French school, graduating from one of the best business universities, and holding well-paid jobs in the financial sector. Although I had witnessed the deprivation and hunger of families that work on coffee plantations and the poverty and debt of small coffee growers, I was indifferent to my surroundings having lived there all of my life. It was only when I immigrated to the United States that I realized the depth of poverty in my native country. It opened my eyes and I promised myself that somehow, someday I would help my people.

By establishing GÜLDEN Coffee, we realized that we could fulfill my promise by building a coffee company that not only provided an exceptional product, but also gave back to society by ensuring coffee workers decent wages for their labor and farmers a fair price for their crops.

I explained the GÜLDEN business plan to friends at one of the largest coffee organizations in Colombia, the Cooperatives of Coffee Growers of Valle del Cauca. The Cooperative gave Cem and me our first big break—a project that would allow us to enter the Specialty (1) Colombian Coffee market, including organic and Fair Trade coffees (2).

During our first two years of business, GÜLDEN sold Colombian-brand certified organic and Fair Trade coffee that was produced, roasted, and packaged by the Association of Cooperatives of Coffee Growers of Valle del Cauca. This coffee was part of the Young Farmers Program (3) created to preserve the coffee-growing tradition among new generations of coffee growers' families and to empower them to generate a steady income.

The Young Farmers Program project was an excellent entry into the coffee-distribution market for us. But it wasn't long before we realized that the coffee we were importing did not fit American tastes. The beans came in only one roast and lost their freshness and flavor by the time they arrived in the United States. We knew that we needed a new business model and eventually we adopted a plan that differentiated GÜLDEN from large coffee distributors by bean type and roasting method.

Direct Trade as Differentiation

In the coffee business, there are three ways to purchase beans. First there is the open market, where the goal is to obtain beans at the lowest price possible without regard to societal or environmental impacts. Second is through Fair Trade practices, which require that beans come from coffee producers that have been paid a fair price, that provide decent working conditions for their laborers, and that use environmentally friendly growing practices. Finally there is Direct Trade, which incorporates all the elements of Fair Trade but also requires another element—direct and intensive communication between the buyer and the grower.

Due to the volume of beans required, large socially conscious distributors generally do not have the luxury of communicating with the growers directly, but rather rely on coffee brokers that are Fair Trade certified. We knew that if our company was to succeed we would need to offer our customers the best coffee possible. This meant engaging in Direct Trade—taking a hands-on approach to the entire distribution process—starting with the growers, whom we communicate with on a regular basis and visit during harvest time.

Committing to a business model based on Direct Trade was a major undertaking for a small start-up company like GÜLDEN as it dramatically increased our costs of doing business. GÜLDEN pays $1.50 to $2.50 per pound more for estate beans than it would for beans traded on the open market. This amount is also above the premium rates placed on Fair Trade beans. But GÜLDEN views this added expense as the route to better-tasting coffee and sound business practices.

Since its inception, GÜLDEN has expanded its direct suppliers of Colombian specialty coffees to include Valle de Cauca Cooperative (La Esperanza Farm), Huila Cooperative, Gomez & Mora Farmers, and Arahuacos Association from Sierra Nevada.

Most recently, GÜLDEN became part of a program called the Andeano Relationship Program which, through farm adoption (4), seeks to promote and stimulate the production of sustainable (5) coffee in the Valle del Cauca Region, and to create direct, strong, and close relationships between the coffee growers in Colombia and the specialty coffee roasters in the United States. In adopting a farm, the specialty coffee roaster becomes the exclusive owner of the farm's micro-lot and benefits from complete traceability of the coffee's origin. GÜLDEN adopted the Aguas Claras Estate (6) in September 2007 and plans to acquire two more farms, El Jardin Estate and La Primavera Estate, in 2008.

Custom Roasting

All GÜLDEN beans are imported green and roasted in the United States. Cem oversees the in-house roasting process at our roaster master in Queens, New York. The beans are hand roasted in small batches to maintain freshness and provide consistency. Roasting is performed weekly, based on client orders. With the exception of our Turkish coffee, which historically is made from a combination of beans, the beans are never blended with beans from different farms, countries, or regions. This differentiates us from other roasters who blend batches of beans during the roasting process.

Coffee roasting is a science that demands precision, care, and an understanding of the tastes and qualities that produce a superior coffee. Cem, whose Turkish upbringing instilled in him a lifelong love and appreciation for fine coffee, has honed his ability to taste a cup of coffee and know the estate on which the beans were grown. He is able to produce a wide range of light to dark roasts using Costa Rican, Kenyan, and Sumatran beans, in addition to those imported from Colombia. GÜLDEN is the only roaster of Turkish coffee on the East Coast.

Obtaining and maintaining certifications that verify a quality product are an important part of our business strategy. GÜLDEN is a member of the Specialty Coffee Association of America, the primary trade association for the specialty coffee industry. It also holds coffee certifications from Colombian Specialty Coffees, a program created by the National Federation of Coffee Growers of Colombia (recognized by its Juan Valdez logo) to highlight coffee of exceptional characteristics. A number of our coffee farms hold certification from Ecocert, a society that intervenes in the field to guarantee that organic agriculture standards are met and are certified USDA Organic. All of GÜLDEN's food service coffee is certified kosher.

Breaking into the Market

With hard work and our unique business model, we are on the way to realizing our dream. Each year the amount of estate coffee that we roast increases, from 1,000 lbs in 2004 to 20,000 lbs in 2006 and a projected 28,000 lbs in 2007.

Nonetheless, sustaining a presence in the coffee market as a micro-roaster is difficult. Our original marketing plan was to approach grocery chains in Manhattan where the demand for specialty coffees is high. We quickly found, however, that the large chains imposed paperwork and other requirements that only well-established companies could meet. We were forced to quickly reorganize our approach and began soliciting small gourmet food chains, which because of their size and family ownership were willing to work with us—a husband and wife team. We also began selling directly to the consumer at farmers markets in New York and New Jersey.

Most recently, I received a call from Whole Foods Market. A Whole Foods representative was scouting farmers markets in New Jersey for locally produced goods and the director of the Fort Lee, NJ farmer market recommended us. GÜLDEN now sells our Turkish-style coffee to the Whole Foods Market in Edgewater, New Jersey through their Locally Grown growers and vendors program.

Lessons

The key to GÜLDEN's success to date has been our honest and responsible business practices reflected through high standards, commitment to Direct Trade coffees, and the personal relationships that we build with our growers and clients.

A few months ago, I attended a trade show where a Colombian coffee farmer approached me and said: "I am very happy that a Colombian lady promotes our coffee in the U.S., please let me hug you and thank you of behalf of my community." I told the farmer I love Colombia and I will do everything possible to help the Valle de Cauca coffee farmers region where I grew up.

I am proud that GÜLDEN Coffee is an American company, supporting increased trade and investment between the United States and Colombia. It will mean more jobs in both countries. The exchange with the farmer touched my heart, encouraging me to strive even harder to make my family's small business a success that I can share with coffee workers and small producers around the globe.

Ana Trejos-Gulden is managing director of Gulden Gourmet, whose businesses include Gulden Olive, Gulden Olive Oil, and Gulden Coffee.


Notes:

1 Specialty coffee, sometimes called "gourmet" or "premium" coffee, is grown in the world's most ideal coffee-producing climates and meets standards established by coffee organizations and federations.

2 Organic refers to how food is cultivated, while Fair Trade is primarily concerned with the condition of the farmer and his laborers.

3 Coffee growers' children between the ages of 18 and 30 were provided with coffee-growing land at low cost and with affordable financing by the Association of Cooperatives of Coffee Growers of Valle del Cauca. They also were offered training and ongoing support. The purpose of this program was to help these young farmers produce high-quality coffee that could be sold at a fair price on the international market.

4 In order for a coffee roaster/distributor to adopt a farm, the farms must meet the following criteria: 1) The coffee grower must harvest excellent export-quality coffee based on Colombian Coffee Federation Specialty Coffee Standards; 2) The farm must support a specific program (e.g., promote sustainable coffees), which translates often to them being certified Organic, UTZ Kapeh, or by the Rainforest Alliance.

5 Sustainable coffees are generally defined as those for which production has been certified by a third party as providing a certain level of economic, social, and/or environmental benefits.

6 The Aguas Claras Estate is owned by Alfonso Aguirre and his wife, Martha. Their farm is approved USDA Organic and is certified by the Rainforest Alliance.


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Read More: Agriculture, Business, Development, Environment, Jobs, Poverty, Trade, Colombia, Turkey, United States, Americas, Europe


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