Social Entrepreneurship Growing a Business while Changing Lives
Coffee is the second largest traded commodity in the world, led only by oil. As a mature industry, supply chains are fully developed and controlled from coffee bean to grocery shelf. While premium brands and fair trade practices have allowed more roasters and growers to connect, the workers who pick the coffee beans rarely benefit from the higher prices consumers are willing to pay for their daily lattes and 11-ounce “pounds” of beans. When Camano Island Coffee Roasters of Washington State opened its doors in 2000, it was with the goal of using the top one percent of coffee beans available – a product that soon proved elusive. The quest for the top beans led a hard-driving businessman along a path of social entrepreneurship to the formation of a new farmer-to-roaster supply chain where everyone benefits economically, often for generations.
Here in the Seattle region, coffee is a way of life. To differentiate my new business, Camano Island Coffee Roasters, from the hundreds popping up more than a decade ago, I chose to use only the top one percent of coffee beans: organic, shade-grown, single origin, fairly traded Arabica beans and to serve them to customers within 48 hours of roasting. While we were good at the roasting part, quality beans became harder to source. I didn’t want to settle for less, but the supply chain was geared to larger companies that had direct relationships with grower associations. For a hard-driving businessman like me, who once retired at age 30 on past commercial successes, failure because of supply problems was not an option.
Seeds of Need
I studied industry best practices, but hit a wall when it came to finding new models for sourcing. It was also during this time that I became interested in Newman’s Own, the food brand started by the late actor Paul Newman. Each year, company profits are given to charities through their foundation – so far, a whopping $330 million.
Having come from a long family line of ministers and missionaries, I was not wholly comfortable with traditional charity. I saw firsthand that good works often bred dependency in the poorest villages, and instead of charity being a hand-up, it became a short-term handout, lasting long enough for the next missionaries to arrive. I liked what Newman’s Own was doing but wondered if there was a way to build a commodity business based on sustainable development. And more importantly to me at the time, was there a better way to source coffee beans?
My answer to both those questions came from a remarkable organization based in Seattle, Agros International. The founder, a lawyer named Chi-Dooh “Skip” Li, believes landownership is the best route out of poverty. Meeting Skip started me on a new life journey: building business while being an agent of social change.
Reducing Poverty Through Agriculture
Agros is a faith-based non-profit with a mission to break the cycle of poverty by helping establish long-term, economic stability, which has eluded many poor families for generations. Agros focuses its work in Central America, where it helps rural families, many of them poor migrant workers, gain access to resources that will put them on the path to owning their own land.
Agros buys farmland then contracts with a village or families to grow and to market crops. Agros provides training and technical assistance, builds safe water systems and latrines, helps establish schools and sets up a long-term payment plan for the agricultural loan. When paid in full, Agros hands over the deed to the villagers and hosts a deed-burning party to celebrate their new status as landowners. The entire development process takes seven to 10 years, and the repaid loan is used to help another village, an act Agros calls “Passing on the Blessing.”
Coffee Supply Chain Solution
I didn’t fail to see the possibilities for Camano Island Coffee Roasters. Given that much of the world’s Arabica beans are grown in Central America, the idea of having the Agros farmers grow my kind of coffee seemed a natural fit. To ensure a market, I agreed to buy their crops for seven years at fair trade (or better) prices. Agros taught them the farming techniques to fulfill the agreement (and my business needs). They also learned crop rotation and extending farm productivity using sustainable methods.
To say it’s been a successful venture is an understatement. Our first group of farmers now owns their land, and they’ve continued to sell their crops to Camano Island Coffee Roasters even though they have the option to sell to other companies. Our relationship is not just one of seller and buyer but one of beneficial partnership.
One Mother’s Story
Every year, I accompany Agros on visits to the farms. This year in 2012, we visited a village near San Jose, Nicaragua. It’s a trip I’ll never forget because of what one woman said to me through an interpreter: Because she and her family grow and sell their own crops, and they could now feed their large family, she would not have to sell her daughters into servitude, or worse, sex slavery. I have a daughter, and I could not begin to know what it would be like to make that unimaginable decision. Yet, because of dire poverty, thousands of families have no other choice.
When I began this journey to uncover a source of really good coffee beans for my small roasting company, I had no idea where it would take me, what affect it would have on my business, what it could mean for my customers or even the impact it would have on my life. However, that woman’s story defined the spirit of my effort.
The news media is filled with tales of scarcity, loss and fear, yet in Nicaragua – a country devastated by civil wars and terrible poverty – abundance and hope are growing. With Agros’ help, a family can stay together, educate themselves and their children, have food to eat and shoes to wear and then pass their good fortune forward. This is what a social-values business is capable of creating – a bottom-line reaching beyond quarterly reports and stock exchanges. In can reverse decades of despair.
Business as an agent of social change is resonating around the world. Last year, we licensed our coffee company model in South Korea. The business group that approached me did so because of the work we are doing with Agros.
Consumers into Prosumers
To ensure a steady source of funding for Agros, and honestly, to protect my source of coffee beans, I created a Coffee Lovers Club, where freshly roasted coffee is delivered to customers’ homes throughout the U.S. For every shipment, we give $1 to Agros. Considering we have hundreds of club members, the dollar amount is substantial – enough to help 42 villages and 24,000 people so far.
As a businessman, I know full well that if our product is not up to snuff, it won’t matter how much good we’re doing in the world. So our foremost commitment is providing great coffee and service. However, occasionally my ministry lineage comes out, and I begin preaching the good beans gospel. We educate our customers about the importance of making every food dollar count, not just for how it impacts the wallet but also the world. Thoughtful shoppers are powerful. Even small choices they make at the grocery store can make a big difference for the environment and society. It’s what I call being a proactive consumer or “prosumer.” They are the catalysts for change. I see it everyday in the coffee business.