What is Private Label Coffee and How Does it Work?
Coffee never goes out of style. Whether the economy is on fire or heading toward recession, the coffee industry always seems to be booming. If you love this caffeinated beverage to the point where you know you could select and package the very best beans to give people the best cup, you may have considered starting your very own coffee brand. But the elephant in the room is: how would you get started?
What is Private Label Coffee?
Simply put, private label coffee is a coffee product that has been manufactured by a third-party coffee co-packer for a brand. Food and beverage brands of all types might be interested in working with a co-packer to create a private label coffee. These companies include cafes, restaurants, big-box stores, boutique grocery shops, hotels and more. Since most of these businesses don’t have the means to import, roast, grind and package coffee beans, they outsource creating the actual product to experienced manufacturers specializing in coffee.
How do you Private Label Your Own Coffee?
First, you need to determine a few different aspects of your product:
- What quantity will you need?
- What roast(s) would you like your product line to showcase?
- Would you like to feature single-origin coffees, blends or both?
- Would you like to sell roasted whole beans, ground beans, ready-to-drink (RTD) bottles?
- Who are your potential customers–coffee shops, ecommerce consumers, grocery stores, food trucks? B2B or B2C or both?
The answers to these questions will be vital for nailing down the right co-packer, as different manufacturers have different capabilities, minimum order quantities (MOQs) and specialties. Then, you need to contact a private label coffee company or sign up with GhostLabel, the online B2B food and beverage marketplace, to start having the product development conversation.
Who Manufactures Private Label Coffee?
If you’re lucky, you might just find a private label coffee manufacturer on your own. However, finding a trustworthy co-packer fit for your product needs and specifications can be risky, complicated and a waste of time.
Luckily, you have a few options. You could look up “coffee near me” and check if any of your local shops or cafes that offer coffee roast and package for private label purposes. The only issue here is that many of those small-scale roasters will probably charge more than a larger co-packer set up for high order volumes. Also, these smaller manufacturers are often restricted to a couple different types of products and might not comply with some of your desired certifications (Organic, Fair Trade, etc.).
Another option is to find a broker, or a person with a network of food and beverage manufacturers. However, it’s important to note that these freelancers rarely work for free. They may know a few co-packers who might help you with your product project. But they typically charge anywhere between 15-30% of your first order, meaning you need to have enough padding in your wallet to absorb the loss.
That’s why your best bet is to register for an online platform like GhostLabel, where you can build out your product specs, find a verified manufacturer and manage your project all in one place. GhostLabel doesn’t charge for introductions and provides you with all the tools you need to follow through on your food or beverage brand.
How Much Does it Cost to Make Private Label Coffee and Espresso?
The answer to this is: IT DEPENDS. If you’d like to have whole roasted coffee beans packaged in stand-up pouches for on-the-shelf sale, you’re looking at around $5-$10 per LB minimum. If you’re selling RTD cold brew bottles, your cost could be anywhere from $3-$5 per bottle. Whatever the product type, make sure to also review your shipping costs when deriving your total costs. Also, if you’re using a broker, you’ll have to include your upfront loss and calculate that cost across your first product run to make your money back.
Whether you’re just starting to look into creating a private coffee label or have had this idea in planning for a few years, understanding the fundamentals of how to manufacture a private label coffee is essential.