How Direct is Direct Trade? An Interview with Herkimer Coffee Roasters

Clustered in a row of artisanal shops that run the spine of Seattle’s Phinney Ridge neighborhood, Herkimer Coffee claims its stake in the competitive landscape of roasters in the Pacific Northwest.  The sun-soaked and cozy café shares its space with a gorgeous Probat roaster that dominates the adjacent room – visible through open windows at the coffee bar.   This is the brainchild of head roaster Scott Richardson.   As the agitator arm of the cooling bin swirled fresh roasted coffee beans, Scott danced in a choreographed pattern around the roaster, filling the hopper with a large silver scoop from a burlap sack.  While I interviewed him, not once did he stop moving and yet captivated me with his utmost detail and calm demeanor.

With over 20 years of experience sourcing green coffee beans, Scott has a unique perspective on the evolution of direct trade.  His passion for coffee transcends the business and its clear he has the deepest level of appreciation for the people who touch coffee.  Scott showed me what direct trade really means; if you take care of the people, the coffee will take care of you.   

Francis: What does direct trade look like and how does it work?  

Scott: Getting to know the producer, like who is responsible.  A lot of times if you’re talking about real small micro lots – a lot of the actual farmers that own them – it’s their land, it’s their family business – work more with a beneficio or somebody who’s a liaison that understands the economic relationship between the buyer and that coffee; they kind of act as an intermediary.  

[Consumers] think you’re telling the story of a specific farmer – and a lot of times [there] is an initial meeting and a handshake but the farmer is not really equipped to deal with what we’re talking about.  So, they let the beneficio handle it because they trust that person.  The beneficio usually is a personal friend and understands what you’re trying to do with him as a liaison.  You can go hang out with him.  Very few [direct trade] relationships are specifically with the producer themselves.  

I have relationships with some large farms out in Brazil, Columbia, El Salvador, Ethiopia, and Burundi where I’m actually dealing directly with the farmers and meeting them and hanging out with them on their farms.  But, I also have direct relationships with a beneficio type arrangement where I know the farmer, but it’s not the normal relationship.  What goes on at origin is not [solely] subsistence but they’re not farming only coffee.  Coffee is a portion of what they do; this is a business relationship.  

After joining with Mike Prins, his business partner, Scott started traveling to the tropics and relationships were made through people he met along the way.  The two of them soon crossed paths with Craig Holt, who established Atlas Coffee Importers, and they watched him build Atlas from the ground up.  In the 90s, coffee hunters were a fearless and inquisitive bunch – well ahead of their time.  

Francis: How did you establish your direct trade relationships and can you describe what makes them special to you?  

Scott: There were relationships that already existed and we just expanded them.  We knew what our principle coffees needed to be and we worked with people that had been around those regions – it was completely their life’s work – and we worked out a relationship with them specifically with what we wanted to do.  It was much easier with a past history than just going down there and thumbing around hoping you find something.  We already knew what we wanted to find.  The foundation was built off of that.  

I’ve helped out a couple producers that said – ‘Hey, I want to up our processing ability and the quality; so, we had to drop $100k on a horizontal dryer versus a vertical dryer’  – or something like that, and we’ll kick up the price per pound to help out for that season and then bring it back to our normal contract price. But it’s pretty cool to have that dialogue, you know?

And when they see you, they’re like, ‘Oh, this is the same guy.’  They get to know you more and more and how you do it; but, a lot of times the relationships are really small and not quite exactly, like, as personal.  You know what I mean?  Some of them are.  And those are the ones that grow longer – my bigger ones definitely are.  You know I can go visit those farms during harvest, stay there a week and treat it like a vacation if I want – but I have too much respect for them during those periods of time.  I’m not going to waste their time doing that; but you can have those kinds of relationships where you can do that.  

Its an existing network – its just becoming more efficient and accessible but only to those who are interested in the story and care enough about others and their livelihoods to create a relationship for the future.

Scott illustrated that one of the biggest benefits from direct trade is what’s at the heart of Herkimer – the espresso.  

Scott: With single origin stuff up high… the farmer gets to showcase his favorite coffees for his favorite clients.  If they get something cool and interesting and they know you’re into it – you’re the first one to get it.  The relationship drives what they want to give you – they appreciate you and want to make sure you get what really makes you excited.  

The espresso has a built-in complexity because it’s blended at origin.  The hallmark Herkimer flavor is born from two washed coffees from one elevation and a natural coffee from a higher elevation… all from the same farm.  

I asked Scott if he saw any downsides, perhaps with logistics? He said he doesn’t see many downsides – even if he has a small order and no way of shipping it.  He added that he always finds another importer with room in the container.  However, he cautioned that avoiding political turmoil and dangerous situations were obstacles to traveling.  Like any smart traveler, Scott does his homework.  Furthermore, knowing how countries deal with coffee saves time and energy, specifically; it helps you avoid being your own customs broker and following a paper trail.  

I brought up the topic of transparency.  Scott stated there’s only one thing of which he’s weary when people talk about direct trade – the confusion on the marketing side when describing transparency.  

Scott: Where some people are trying to take [direct trade] and how they’re describing it… I don’t look at it as a marketing ploy; I look at it as the right thing to do.  But when someone else is doing direct trade and tries to make it look better than what you’re doing, it becomes a competition and marketing thing.  

When I hear the term transparency, I think that someone’s trying to hide something.  That was a bit of an issue seven years ago when I was trying to get people to see that to use transparency – as if you’re hiding something – sounds like a banking term and I don’t really like that.  

Discounting coffee that doesn’t have that system (DT) in place yet – as in, not seeing the labels on the bags – you’re not really giving that coffee a chance and a lot of people miss out.  There’s a bunch of different ways to do it.  There’s no wrong ways – unless you mislead someone into thinking your way of direct trade is better so you can make a profit over the competition. But that’s the question of transparency.  

Just let people know that you have some hitch in there and you can touch it and live it and you’re trying to make it a mutually beneficial thing rather than something to market with.   

The benefits of transparency, ironically, bring some drawbacks.  At one end of the spectrum, we really want farmers to be recognized for their efforts and supported, so much so that we adorn retail bags with their names and a short story about their farm.  However, their new popularity brings visitors.

Francis: How do micro-lot farmers handle the growth brought about by transparency with respect to logistics and screening window shoppers?

Scott:   A lot of the problem for producers is small roasters who aren’t buying a full container – but [those make up] some of the relationships you have, for instance my Burundi farmer, who’s only making a container and a half the whole season.  But he’s happy with it because that’s the world he’s created and Burundi is such and underserved origin.  Every relationship is different depending on what they’re able to do or willing to do with you as long as you’re committing to them – and you’ll get better service from them instead of trying to find something new and small because no one’s ever heard of it before.  

People are like ‘What’s new this week?’ – when they’re not thinking there’s four more weeks until the next regional cycles arrive.  This leads into teaching consumers about the real coffee cycle – trying to elevate it to tableside service isn’t a bad thing but it can be detrimental if it doesn’t build on the foundation that’s been laid… you can’t discount the efforts of people that have come before.  

We’re talking about people that want five bags of micro-lot so they can market it and have something new every year instead of building a well-established relationship; or barista groups that go down, even with a buyer, but they screw around and party.  

Francis: Is direct trade sustainable?  

Scott:  Your buying volume can get in your way sometimes… when you don’t buy that much and someone is willing to go an extra mile for you… People gave us the benefit of the doubt – instead of buying full container loads at first – but once you get to that level, our relationships really started to flourish because you become a very important cog in their daily work.  It’s pretty easy to bank on someone who does everything you want from them and takes what you do in the highest regard.  We buy multiyear – whether the C market is high or low either in their favor or our favor – just trying to balance it.  More and more people are starting to come around on that, which is kinda the way it should be, a more realistic model.

It’s a broad term but direct involvement – knowing the family, how they farm, what’s important to them, how they’re treating it and moving on from there – as long as you mesh with that – you’re going to get the most of them.  And the nice thing is when a lot of us were starting, just the accessibility to central America, we got to see a positive correlation to direct relationships; and, these producers were willing to go the extra mile because they realized the buyers were going to give them more money for the extra effort.  

And so it spreads.  Its easy to find farmers who want to help; then the challenge is getting them up to the quality level; but, most of Central and South America is already well on its way.  If it wasn’t for direct trade, stuff like that is not going to happen.  There’s very cool things that can happen from it – each relationship is very different.  It’s a broad thing – I view it more as a commitment – you find something you want to mutually invest back and forth in.

IN CONCLUSION

Herkimer is synonymous with direct trade.   With over 20 years of experience in coffee, Scott Richardson has watched the industry rise up around him, observing how some of the giants trademarked the term direct trade in order to compete in marketing games.  The truth is, Scott and his business partner, Mike, built the foundations of Herkimer on commitments that were forged with coffee growers a long time ago.  They helped create a network that binds farmers and roasters together – a network that importers and roasters have relied on for their own success.  In other words, they were doing direct trade before it was even a thing.


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