Where your coffee dollar goes: breakdown of costs in a pound of beans via @wordpressdotcom Wot no free shipping?

Where your coffee dollar goes: breakdown of costs in a pound of beans via @wordpressdotcom Wot no free shipping?

Different cost structures. Not everyone has the kind of state-of-the-art clean roasting equipment we do, which leads to a big depreciation expense every year. Not everyone travels to origin to buy coffee, and thus they avoid travel expenses. So there are some choices that can be made to reduce costs, but in our estimation those choices also reduce product quality, customer choice and harm the planet. More volume. I have to divide my fixed costs by the number of pounds I sell. If the denominator increased, the cost per unit would decrease. To come extent, our volume is a function of the time we’ve been in business. But it’s also a function of the fact that we don’t employ sales people, that we finance our working capital needs almost entirely from revenues, and more. Bigger volumes are one legitimate path to better costs for us, but it will take time. Art of the upsell. Ama...

Full article: http://muddydogcoffee.wordpress.com/2011/01/28/where-does...

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