The Need for Coffee Companies to Stay in the Market in the Face of Disruption ^†

Abstract

The coffee industry is at a critical juncture where traditional business models and operational practices are no longer sufficient to ensure long-term sustainability and competitiveness. This study explores the imperative need for disruptive innovation across the entire coffee value chain, from coffee farmers and green coffee traders to coffee roasters. Climate change poses a significant threat to coffee cultivation, with rising temperatures, altered rainfall patterns, and increased pest infestations impacting crop yields and quality. Coffee farmers must adopt sustainable agricultural practices, such as agroforestry and precision farming, and leverage technology to mitigate these risks and improve productivity. Additionally, the entire coffee value chain must strive to become climate-neutral, incorporating eco-friendly practices from cultivation to consumption. Green coffee traders face the challenge of enhancing supply chain transparency and embracing digital platforms to streamline operations to meet the increasing demand for traceability. Future coffee trade agreements will not only be based on bean quality but also on comprehensive data accompanying the beans. This includes their precise origin details with geocoordinates, complex risk analyses, and adherence to the rights of indigenous peoples. Consequently, both bean quality and data quality will become fundamental aspects of commercial transactions. Coffee roasters need to innovate in roasting techniques, diversify product offerings, and adopt more sustainable packaging solutions. Furthermore, achieving climate neutrality requires integrating renewable energy sources, reducing waste, and improving energy efficiency throughout the roasting process. This presentation delineates the urgent need for adaptation and innovation at each stage of the coffee value chain. By providing a comprehensive overview of the required adjustments, a roadmap for coffee companies to navigate the complexities of the future market landscape is offered. The presented thesis underscores that only through significant disruption and continuous evolution, combined with a strong commitment to sustainability, can coffee businesses ensure their continued presence and success in the industry.