2015 Financial Information
In 2015, Pachamama Coffee Cooperative received an average of $12.04 for every pound of roasted coffee sold.
The Financial Information chart presented here breaks down the costs incurred and the gross profits earned for 1 pound (16 ounces) of roasted coffee sold. On average, it cost Pachamama $5.70 to bring a pound of coffee to market in 2015. For their Certified Organic coffee, our members were paid $3.08 per pound roasted, or 26% of our revenue ($3.08 / $12.04). Since there is 19% shrinkage when coffee is roasted, the price paid per pound of raw coffee (FOB) to the cooperative was $2.49 ($3.08 x (1.00-.19)).
- $0.20, Financing (2%) – Bank financing for raw coffee
- $0.46, Importing (4%) – Transport, customs, storage
- $0.65, Roasting (5%) – Gas, maintenance, labor, rent, organic certification
- $0.67, Packaging (6%) – Bag, stickers, labor
- $0.65, Shipping (5%) – UPS or USPS
The total variable cost is $5.70 per pound, or 47% of the total.
Gross profit earned for 1 pound is $6.34 (price - variable cost), or a 53% gross profit margin. This is the value created before overhead and fixed costs.
The farmer-owned portion of this supply chain accounts for $9.42 ($3.08 for coffee and $6.34 for Pachamama brand), or 78% of the total price.
Pachamama Coffee Cooperative is 100% farmer-owned and governed by these 5 cooperatives, which are in turn owned by more than 140,000 families in Peru, Nicaragua, Guatemala, Mexico and Ethiopia.
Net profits are paid to members as determined by the board of directors. There are 5 member cooperatives, each with 1 director and 1 vote on the board. There are only 5 directors in total, all representing farmers. Profits are paid proportionally to members in relation to the coffee they sold via Pachamama. For example, if a member supplied 28% of the total coffee Pachamama sold last year, they would receive 28% of the net profit.
This is simple a snapshot of one pound of Pachamama coffee in 2015. This is not an illustration of net profits earned by farmers or roasters. This is simply the revenue received and the gross profits earned. If you would like more information, please contact us at firstname.lastname@example.org.