Aroma of Success

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-By John Boley

If you want to give yourself a mountain to climb, how about trying to convert the world’s biggest tea-drinking markets to sip coffee? China and India – that’s the task Phillip Di Bella has set himself, and he is confident that success will soon be his – although of course it won’t be instant.

The Di Bella coffee brand was started in 2002 after Phillip’s passion for coffee and his entrepreneurial spirit led him to establish a small coffee-roasting operation in the suburbs of Brisbane. His enthusiasm for the product and the whole experience was infectious and he soon became a key player in the local coffee scene. The rest of the company’s first decade was a blur of growth and awards, including the BRW Fast 100 for 2006, 2007, 2009, where Di Bella Coffee was the only coffee company to make the list in consecutive years.

Today, Di Bella wholesales fresh-roasted coffees throughout Australia and has a series of retail outlets, having not only ridden the wave of popularity of the brew but as Phillip himself says, “outperformed the sector.

The core reason for the company’s success, he believes, is that “we don’t see ourselves in the coffee business, we see ourselves in the people business.” Leading by example, he is pleased to hear everyone throughout the company talking not about product, but about customers. “Coffee is the second most [frequently] drunk beverage in the world, but no one knows anything about it because there has never been anyone to teach them. So we put education at the forefront of what we do,” whether the consumer is after a single cup or an in-depth analysis of the coffee industry. “Then they don’t feel uncomfortable [and they] know a lot more about what they are drinking.”

Phillip is keen to strip away the remaining layers of snobbishness about coffee – about where it comes from, how to roast it, how to keep it fresh and how to drink it. “I created a perception. I wasn’t going to pretend to have the best product, because ‘the best’ doesn’t exist. What I was going to tell you was what my product and what my business stands for and what my brand DNA was.” He noted that around 85 per cent of coffee in Australia was drunk with milk and consumers “needed the correct coffee that enabled you to mix it with milk and have strong full flavours.” This in contrast to a more traditional approach of telling the consumer he or she is wrong to put milk in the cup. “If you get sniffy, you upset the consumer. Instead of upsetting them why not educate them?” Similarly, an average cup of coffee is taken with two sugars, so “I developed coffee that was quite sweet and balanced, that didn’t need two but just one sugar or even no sugar. When you talk about designing a product, I went about it in tangible concepts based on the consumer. I didn’t talk about flavours.” In other words, don’t tell the consumer he or she must have it bitter, just because that’s somehow ‘right’.

Nowadays, things have changed a lot. Consumer taste has evolved, Phillip says. “Now we are bringing out different flavours from different regions of the world, with different brewing methods. There are cold drip siphons, all these sort of filtration systems that have been around for a long time but they are now funky and groovy and that is because of evolution.”

When he started in 2002 “my target audience were clearly café-goers, because I wanted to get my product into cafés.” He did this by convincing them of the benefits of freshness – coffee “is at its best from 48 hours of roasting to two weeks old, regardless what brand. If fresh is where you want to be, ultimately between 7 and 14 days is the peak.”

Di Bella’s founding customers are still with him today. Phillip believes this is because he doesn’t issue contracts to his customers, he earns their business. “This ensures I am continually improving my product offering and services and is how we stay ahead of the competition.”

Initially, he was not targeting the instant coffee market (still something like 70 per cent of overall consumption in Australia) though in the last three years he has begun to offer alternatives. People do not realise, says Phillip, that instant coffee is “quite bad for you. It is not a natural process; that is why they can’t use the word natural on any of their products. ‘Natural’ means it can’t be altered by temperature or by chemical. Instant coffee started off being altered by chemicals and then they brought out freeze dried methods.”

Even then, coffees ‘selected’ for instant tend to be inferior. “Talk to any farmer and they will tell you that the lowest grade coffee they have on their farms goes off to the instant companies. It is often low quality Robusta, fully loaded with caffeine. So people’s experience with coffee is that you get irritable bowel, it makes them vomit and they get sensitive to caffeine because instant coffee can have over three times the level of caffeine of a normal coffee.”

TORQ, one of Phillips latest innovations, created to ‘replace’ instant, is officially referred to as a “natural coffee concentrate” made out of top-grade Arabica coffees, some of the best coffees from around the world. It is put through a cold-brew method and a liquid concentrate is extracted which is then put through a patented micro-filtration system, giving it a 12 month shelf life. “It is coffee and water. It is a world’s first because it is natural – there are no chemicals, no flavourings, no additives and no preservatives. We are in discussions now with airlines, convention centres and more.”

Motivated by the success of TORQ, Di Bella is putting the finishing touches on its PUCC product – ‘pure, unadulterated cold-brewed coffee – “coffee in a can”, as Phillip refers to it. It is the TORQ natural instant coffee with water and a natural brown sugar, six grams per 100 ml, so not loaded with 30 grams like others on the market.” This product accords with the heart foundation recommendation, Phillip says. “It has no fat in it. It will be that refreshing cold hit of iced coffee. It can be mixed with alcohol – you can make espresso martinis out of it. We will bring out a milk version later on and it will also take on the energy market because it is a natural energy drink.” It is aimed squarely at the 18-24 year old market and if you qualify, check out the early website for the product, provocatively named “www.PUCC.me”. Phillip estimates demand rising “conservatively” to at least 100,000 cans per month within six months of launch.

PUCC is going international. “The number one selling product out of a convenience store in Asia is coffee based in a can. It will be bigger in Asia than it will be in Australia,” Phillip predicts, although he says he will keep production in Australia for reasons of “control over anything that carries my reputation and my name.”

And so to China, where the company has been active for two years, first as a joint venture and latterly as a wholly owned operation, and India, where Phillip has opened five retail outlets. “There will be probably 10 shops by the end of this year,” he says, “all company owned.” Originally, he too thought these were such good tea markets that they would be tough to crack. But in China, demand for coffee – especially good quality coffee – is growing at least as fast as it previously did in Australia or Europe, and not just on the mainland. Di Bella currently has some 50 shops and supplies hotels and restaurants too. “Where China has also been strong for us is as a stepping stone to a wider, greater distribution” – Korea, Vietnam, Malaysia, the Philippines and Singapore. “But I tell you: the true growing middle class is in India. We have five stores and each is doing around 200 cups of coffee per day which is double what I had expected” (speaking only a month following the launch). Phillip is in a joint venture “with an Indian gentleman from Sydney who has successful cafés [there].” In that market, the sky is the limit, he believes.

Phillip, a natural fast-talking enthusiast, spoke about many other things. Pods? “A compromise for consistency and convenience,” and to this end Di Bella has a refillable pod that makes the experience considerably more consumer-friendly. Ethical sourcing? Very important. Phillip wants to deal direct with the farmer and cut out the broker who wastes money and sits on coffees until he has a customer – so the freshness is compromised. “Any coffee I buy from a farm that has been put through our quality assurance testing, I am going to use; I don’t have to sell it to anybody else. Whereas the brokers have to on-sell that product and if they don’t, they don’t buy any more. Me? I use it, so for the farmer, as long as they meet the quality expectation, they are in business with us.” But what underlined the entire conversation was one fact: while Phillip is not arrogant and he doesn’t make statements he can’t back up, “the Di Bella Company stands for ‘we know coffee’ – from crop to cup.”

Making Sense of Management

Management is the art, or science, of getting things done through people. Sounds fairly straightforward – except for the fact that people are not robots waiting to do our bidding. People have their own minds, motivations, and goals. So how do managers keep operations – and the people behind them – running as planned?

December 16, 2018, 6:45 AM AEDT