Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: SUNDAY, January 22, 1995 TAG: 9501200042
SECTION: ECONOMY PAGE: 12?? EDITION: METRO
SOURCE: KIMBERLY N. MARTIN STAFF WRITER
DATELINE: LENGTH: Medium
The U.S. coffee industry is on the verge of a revolution and Roanoke may be on the front line, thanks to H&C Coffee Co.
Instead of haggling over a slice of the coffee-consumer pie, H&C President Chris Stave is working to expand that pie by bringing nontraditional java drinkers into the coffee-achiever fold.
Stave has already joined the gourmet coffee bandwagon to attract people who never much liked traditional coffee. Now he has poised his company as a U.S. front-runner of a product that's intended to lure former coffee drinkers, turned off by heartburn, back to their four cups a day.
The key is a new kind of coffee called EuroMild.
"It's not just another brand of coffee; it's another classification," Stave said. "It's like when light beer came out. People were skeptical at first, but before you know it, it's outselling regular beer."
EuroMild starts like most other gourmet coffees as a Colombian green bean. But instead of going directly to roasters, EuroMild coffee heads for Germany to be purified with carbonated water. Then the beans are shipped back to the United States where they are roasted, packaged and shipped. The process produces a bean that's darker in color and smoother to touch than the usual coffee bean.
The added step makes the premium coffee more expensive. A 10 oz. bag of EuroMild costs about $6, whereas regular H&C Coffee retails for half that, the company said.
But the taste, once roasted, ground and percolated, is about the same - just milder, Stave said. The difference is that people with stomach problems such as ulcers may be able to drink EuroMild without having to reach simultaneously for an antacid.
"The gases [in coffee] that cause stomach problems are drastically reduced in EuroMild," Stave said.
He has a German study that says "coffee refined by this method was less acid-stimulating than before the processing." And he has EuroMild's market success in Belgium, England, France and Germany to back him up.
"In 1993, 20 percent of all coffee sold in Germany was purified coffee, and it's outselling decaf 2 to 1," Stave said. "I just look at it like Germany and the U.S. aren't that different. The people aren't that different."
He's banking on that theory. He is partners with River Road, a Massena, N.Y., coffee roaster, in the EuroMild venture. Together they've invested about $1 million in the New York production plant, where the bulk of the coffee is roasted and packaged.
Roanoke and Massena are EuroMild's U.S. testing grounds.
The coffee has been on supermarket shelves in the Roanoke Valley since November. Sales have gone "moderately well," with a few exceptions, Stave said.
He isn't worried about the coffee's average sales. He has an optimistic wait-and-see attitude on that.
"Between 10 and 20 percent of the American adult population has stomach problems. That's a huge potential market. If we could add 20 percent to coffee consumption, that would be $4 billion more in U.S. sales," he said.
But he admits the partners are a long way from that goal.
Winn-Dixies around the Roanoke area will carry the coffee soon. Kentucky is the next stop on Stave's campaign to sell EuroMild nationwide.
Stave said EuroMild, under the River Road label, will be for sale by late summer in every major grocery store east of the Rocky Mountains.
The H&C name will be used only in Virginia and North Carolina.
If EuroMild, which will be available in decaffeinated blends in a few weeks, does as well as Stave hopes, it's a win-win situation for Stave and H&C.
"If we outgrow production in New York, which could easily happen, the second location would be here," Stave said. That would mean a new plant and jobs for Roanoke. But there are no guarantees.
Right now Stave and River Road have the exclusive North American rights to buy and distribute the coffee from one of the world's three coffee purification companies. But if EuroMild becomes a hit in the United States, more purification companies are destined to emerge, and so, ultimately, is competition.
"We have an 18- to 24-month head start. But we've made the commitment to this product, and we're going to stay with it until it works," Stave said.
by CNB