Specialty Coffee Association CEO Yannis Apostolopoulos on improving coffee’s value chain and why long-term relationships are the key to market production.
On the eve of the 2022 Specialty Coffee Expo in Boston, Massachusetts, Specialty Coffee Association (SCA) CEO Yannis Apostolopoulos was excited to reconnect with the international coffee community at North America’s largest gathering of specialty coffee professionals. But more than that, he was excited about the opportunity to celebrate success in the SCA’s agenda for the specialty coffee industry.
“The SCA is in a good position to start supporting the industry to be more equitable, sustainable and thriving. How we distribute value along the value chain will be a core focus for the next three years,” Apostolopoulos tells Global Coffee Report.
Apostolopoulos was appointed SCA CEO in January 2019. An SCA roadmap for the next five years was put in place in December that year, with four goals driven around its purpose to “make coffee better”.
First, was the aim to create a sustainable specialty coffee agenda, which Apostolopoulos says was a result of the SCA’s Price Crisis Response Project to focus on monetary and non-monetary value along the value chain.
The second, was to expand the SCA’s network of companies and professionals and become more relevant in local communities with a higher volume of activations. Already, this has resulted in the first World of Coffee in Dubai in 2022, Sensory Summit in Korea, and new events to bring retailers, and producers, and others in underserved parts of the value chain into the forefront of connection such as the Coffee Retail Summit and Green Coffee Summit.
The third goal was to facilitate professional development and leadership skills for members.
“People come to the SCA looking for professional development, to find jobs, to get educated,” Apostolopoulos says, noting that 70,000 SCA certificates are distributed each year.
“Our focus is to provide more education and not just through coffee skills and technical programs, but through new programs like business education for producers, and coffee education for business professionals. The SCA is also trying to create pathways for people to better connect and find their career in coffee.”
It’s fourth goal – and internal pillar – is to deliver excellent service to the SCA community.
With a clear pathway leading into 2020, Apostolopoulos says the past two pandemic years were an unfortunate setback. Despite many perceiving the organisation was event-driven and in financial distress, Apostolopoulos says it was thanks to its revenue streams through its education platforms that helped the association to survive.
“It wasn’t an easy year. Everyone worked hard under difficult circumstances. We created a lot significant deficit, we cancelled two World of Coffee trade shows in Europe and one Expo in the US, but we survived,” he says.
On the other hand, Apostolopoulos says COVID-19 became an accelerator for specialty coffee. People started to appreciate their daily cup and tried to replicate café quality coffee at home. Consequently, retail sales skyrocketed, as did home espresso machines.
The SCA also found its digital voice, establishing its first digital Re:co seminar, launching virtual coffee Summits, moving its education courses online, and managing to still host the 2021 SCA Expo despite hurricane Ida hitting the city of New Orleans three weeks out from the show.
“New Orleans may have been our smallest show to date, but it was the most international because the exhibitors were mainly producers who wanted to make quality connections. Having the show was the right decision. It gave people a much-needed opportunity to do trade, and it helped restart economic activity in the city,” Apostolopoulos says.
“Coming out of the crisis is one of my proudest moments. Leadership for me means the ability to be resilient in tough times, the ability to stay focused on values and purpose, and to rally a great team of people to deliver the best. And we did that, facing something none of us had dealt with before. We did things with the best of intentions, with our principles and values guiding us through. There are lots of leaders at SCA. You don’t have to be the CEO to be called a leader.”
Growing up in Athens, Greece, Apostolopoulos says most coffee was consumed cold, with global brands such as Nestlé and illycaffè owning the market. The creation of cold “freddo espresso” with foamed milk on top exploded in Greece throughout the 90s, but it wasn’t until the early 2000s when specialty coffee started its movement across the country.
“We might be a small country of 10 million people, but our coffee scene is amazing. We have the most placements in the top three of the World Coffee Championships. What’s more amazing than our results, is the people within the coffee community – such a diverse, friendly, supportive group. That’s what attracted me to this industry,” Apostolopoulos says.
A chemical engineer and Harvard Business School Alumnus, which Apostolopoulos credits for his critical way of thinking, his first encounter with coffee was while working with W.S Karoulias, one of the largest wine and spirits companies in Greece. It owned 30 per cent of the market share before the 2008 collapse of the Lehman Brothers forced the business to look at other offerings. Coffee was a natural alignment, and it was through roasting and distributing of espresso machines that Apostolopoulos realised coffee was much more than a commercial product.
Determined to learn more, Cosimo Libardo, then Sales and Marketing Director at Nuova Simonelli and now SCA Board Director, invited Apostolopoulos to a coffee crash course at the Simonelli factory where he cupped coffee for the first time. Apostolopoulos walked out a Q Grader.
It was Apostolopoulos’ first encounter of the 2013 SCA Expo in Boston, however, that he credits for opening his eyes to a world of possibilities. From there, he volunteered with the Specialty Coffee Association of Europe (SCAE) Greek Chapter and was recruited to the SCAE board.
“In 2016 was when I transitioned from being a volunteer to staff. It aligned with my values. I believed it was my way to give something back to the community and help make an impact in a small way,” Apostolopoulos says.
That impact was put to the test when in 2016 it was proposed the Specialty Coffee Association of America (SCAA) and SCAE should merge.
“It started as a noble idea. Both boards of SCAE and SCAA understood there was huge potential to bring both associations together, create a new culture, and make a greater impact in the specialty coffee industry,” Apostolopoulos says.
“I remember addressing the Re:co seminar in 2016 and telling the audience that only 25 per cent of mergers succeed and 75 per cent fail. It was a big undertaking. We were risking two organisations that were already successful, with the hope to create something bigger.”
Of the 42 per cent of members who voted to decide the future of the associations, almost everyone voted in favour of the merger.
“Seeing where SCA is today, I feel really proud the merger happened. We have a substantial voice today to foster global coffee communities and support activities to make coffee more equitable and sustainable,” Apostolopoulos says.
The SCA is now on track to flourish out of what’s been a long period of transition. It is focused on growth in the United States, United Kingdom, Australia, Korea, Southeast Asia and Middle East – the fast-growing specialty coffee market at present – and in producing countries.
The SCA is also committed to undertaking more research and providing reliable data on trade, which Apostolopoulos says will be the key to addressing challenges in future.
“When we talk about value distribution, we want to repurpose the funds from our education programs and sponsorship into actual research that can help advance the industry,” he says. “As such, we have created the Coffee Science Foundation, the research arm of the SCA, to support this network, and are looking to support our research with donations from the private sector.”
The SCA will also launch a new cupping form, after revisiting the popular tool that has become price discovery mechanism used to distribute value, but one which Apostolopoulos believes can be more transparent and equitable. The SCA is working with partners including the Alliance for Coffee Excellence and World Coffee Research complete the redesign that will become available in the not-to-distant future and help dispel the barrier between commodity and specialty coffee.
“It’s not about labelling specialty coffee as ‘good’ and commodities as ‘bad’. Coffee farmers have coffee they sell for commodity and coffee that is specialty. It’s how they make their value,” Apostolopoulos says. “Specialty is not about coffees that are only 85+, it’s about defining it to be more about science and having intrinsic and extrinsic attributes: known altitude, varietal, farmer etc.”
Coffee prices are at a 17-month high according to the International Coffee Organisation. Yes, producers are making more money, Apostolopoulos says, but the question remains: how sustainable is it long-term? This is where the value of reliable data is needed.
“We don’t really know how much coffee is out there or in warehouses. We don’t have enough transparency in the value chain. I don’t think regulation is what we need as an industry. What we do need when prices are low – and the model of the market suggests prices will go down at some point – is better communication between producers, sellers, and buyers,” he says.
“We need to focus on how to build long-term relationships which offer equal protection and equitable distribution of value for both sides of the value chain. Only then can it become more sustainable. One side can’t bear the risk more than the other side, that’s when you have volatility and market panic.”
To Apostolopoulos, making coffee better is an endless journey, but there is no finish line.
“It’s about finding balance in the value chain and how you distribute that through risk and reward,” he says.
Apostolopoulos says in 10 years’ time, if he sees the SCA thriving with a huge network of stakeholders, coffee professionals and coffee businesses globally, aligned with shared value to make coffee better, that would be the biggest success of all:
“If we can achieve that, it means we’ve set the groundwork to make coffee more sustainable for everyone in the value chain. That’s what we really want.”
This article was first published in the May/June 2022 edition of Global Coffee Report. Read more HERE.