A Cup of Coffee
November 9th, 2018

How does the humble (before adding multiple embellishments) cup of coffee relate to your supply chain?  Start with growing and shipping the beans to a roaster.  It then must be transported to a purchaser, marketed and sold to a retailer who then prepares it and sells it to you.  There are multiple cost centers from the time the bean is harvested from the bush (cost of the land, the seed and the labor) to the time it becomes salvation for you.

There are at least three transportation nodes there – the grower to the exporter to the roaster to the buyer to the retailer.  Gas prices are going up.  The economy is booming.  Wages are going up, albeit slowly, at every stage, and the strong economy is putting upward pressure on wages.  You might not have as long a supply chain.  But in my experience one of the many things that small business owners often do not pay enough attention to is their costs.  If there are a couple of different particularly important nodes in your supply chain it might be worth keeping an eye on what is happening in that particular industry because things could be happening that could lead to increases in the costs in that particular node before it gets to you, giving you a chance to prepare if necessary.

Understanding your supply chain could make you second and third cups more enjoyable.

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