Rise and grind! Founders of Civilized Coffee discuss their latest venture and how their previous successes and failures – along with the smart use of business cards – helped pave the way for their e-coffee business.
Fittingly, Civilized Coffee was created over conversation and a cup of java. In the fall of 2017, founders Mark Patterson and Jeff Norton were drinking coffee in their warehouse, ruminating over their next business moves.
Patterson had recently left his ice cream and food consulting businesses while Norton had just returned from Africa, where he was working with local coffee farmers to import green coffee from around the world for wholesale. Together, they decided that a coffee company was the perfect endeavor, and the name came from a Thomas Jefferson quote. “In 1824 Jefferson deemed coffee ‘the favorite drink of the civilized world,’” says Patterson. “We decided this was perfect for what we wanted our brand to represent – bringing civility back to conversations.”
Shunting aside brick-and-mortar, the business model was always going to be online sales. “It’s quick to market this way,” says Patterson. “Products can be instantly uploaded and ready for purchase.” Another benefit of e-commerce is that it’s inherently a large market. While sales would be local or regional from opening a café, the reach is national and global from the very start. Costs are also reduced so savings are passed on to consumers.
“I handle sales and marketing, and Jeff searches the world for the best coffees – from our Tanzanian Peaberry ‘Mount Kilimanjaro’ to Indian ‘Monsoon Malibar,’” says Patterson. “Together, we make a great team and complement each other’s strengths.”
Now in 2019, Civilized Coffee is all about expansion. They launched Civilized Coffee’s brand, Refresh, with new packaging and an updated website, the Green Coffee program, gift boxes and an expanded product line. “We have the space, the knowledge, and most importantly, the passion to keep growing Civilized Coffee,” says Patterson.
Here’s how credit cards contributed to the grind.
What was the beginning of your business like? Any hardships you had to overcome to open your doors?
Luckily, we both have had success and failures in the small-business world. The one big lesson we learned and stick to is “think big, start small.” This was key when starting on a limited budget. It also helped us when we launched a new product – we don’t need to order or create thousands of units. We could start with a small order and get instant online feedback from our customers and if we needed to make changes, we did. We could make a larger order and adjust if we needed to with confidence.
We sell on Amazon which is an amazing way to reach over 300 million possible customers. It’s easy to sell a product on their platform but it can be a very expensive lesson if you do not know what you are doing. There are several costs you may not plan for that can quickly eat into your margins, such as pay-per-click ads, storage fees and returns.
What is your experience with using credit cards for the business?Credit cards are key to our success. They allow customers to purchase our products and help us manage our business online. We charge the platform fees, professional services (such as accounting), marketing, shipping, product packaging and labeling.
We currently use two cards: the Capital One Mastercard – which is a cash back card – for any purchases dealing with costs of goods, and the Delta SkyMiles® Platinum American Express Card for everything else. The cash back is great because we can put it right back to work and the SkyMiles can be used for both work and pleasure.
Preparing for upcoming costs is important. For example, launching a new product has several obvious expenses that include the product itself and packaging. But there are also some not-so-obvious costs which include label design, product photography and samples. Spending the money is fine if the product is a success, but if it fails, you will not recoup those expenses. That’s why we always stick to the “think big, start small” motto. If you are not growing, you are dying, so we are definitely in a strong growth mode. We plan on being here for a long time.
How do you handle the financial aspects of running the business? Are you usually leveraged, or do you remain debt-free?
Jeff and I are both responsible when it comes to finances. We use our credit line on the cards to help with cash flow during the month, but we pay off our balances as quickly as possible. As we grow and need more funding, we will look at more options for financing.
As a business owner, what have you learned about borrowing money along the way?
Sadly, I learned the hard way that just because someone is offering you money does not mean you need to take it. First, think really hard how you are going to use their money and how they expect you to pay them back, whether it be a financial institution or your Uncle Joe.
As for my advice to other entrepreneurs – think about what you want your business to be. Is it going to give you a paycheck every week or are you building a company to sell? Do you have the passion and strength of mind to do whatever it takes every single day? Do you have a support system to help you achieve your goals? You have to answer all those questions before you start out.