There is an expression about not trusting a skinny chef, but most chefs I know are quite lean and their food is fabulous. We know it is about consuming quality and not quantity. It seems that this is something we can also take from the book of the Millennium generation: consuming less, but better. And when we deal with a product of quality, there might even be an opportunity for investment.
There is not much more we can say about Millennials consuming less wine, but perhaps we are missing the bit where they are actually still using their significant purchasing power. Rather than stocking up on a few bottles for the weekend, they might buy one beautiful bottle for Saturday’s dinner. The best bottle they can afford, a wine that has an origin and a story. Isn’t this actually the way we want wine to be enjoyed? According to Brian Ward in Wine Enthusiast, “Millennials are increasingly interested in the alternative asset space”. This alternative space is about financial investment into non-conventional categories such as Private Equity, Hedge Funds, Real Estate and Private Debt, but also more exotic investments like art or wine.
With my increasing focus on coffee, I’ve asked the question on how investment-worthy coffee can be. Perhaps the investment in the actual product is a little more short-term, spoiling yourself with the best coffee you can afford for breakfast compared to investing in a bottle of wine to mature for a special occasion. The rise of coffee culture can definitely be attributed (at least in part) to Millennials. The popularity of specialty coffee and cafe culture are fueled by Millennials who regard such coffee as an affordable and convenient treat and something healthier than going to the pub. They prefer sipping on a single origin cup of coffee that shares in its steaming sips the story of its rarity, quality, and flavour.
While, despite its immediate gratification, coffee as a product might not hold the same investment quality as a bottle of wine from a special vintage or Château, coffee can be quite an investor-friendly industry, especially to those who are looking for a stable commodity to diversify their portfolio.
Investing in coffee stocks can involve the buying and selling of coffee to be delivered at a future date, investing in coffee as a commodity with exchange-traded funds (ETFs) or investing in established companies like Starbucks, start-ups like Cumulus Coffee or even getting involved with a franchise. For those interested in the sustainability and equality of their investment, coffee farms with fair trade and responsible environmental practices, might also be a good idea.
It seems that while coffee is one of the most popular beverages in the world, it is about more than ingesting, but also investing! What does the future look like? With technology and traceability becoming even more important, I believe there is even more opportunity for coffee. More than the actual product, the machines and equipment offer business opportunity and from a marketing and publicity side there are still much of the history, traditions and stories around coffee to discover and share.