Wake up and smell the coffee (Episode Three)

So far I’ve told you about Starbucks’ motivations for changing its purchaising policies and how they partnered with CI... this episode will be about how the project actually worked.

Back in the beginning, the Chiapas project offered technical assistance for improving growing techniques and coffee quality. CI also provided organizational assistance to the farmer cooperatives so that they would be able to market their coffee more effectively and efficiently. In order to be part of the program, farmers and cooperatives had to sign an agreement with CI. According to the degree of achievement of targeted farm improvements agreed upon between CI and each farmer, and upon meeting Starbucks quality standards, producers would gain the right to sell an increasing percentage of their crop to Starbucks for its premium prices.

There were two main practices that had to be implemented so as to remain in the program: no trees could be cut down on the farms or the Reserve, and no coffee pulp could be thrown into the rivers. Other criteria included the planting of shade trees, the conversion of coffee pulp and other organic matter into compost for fertilizing coffee plants, the payment of fair wages and the sheltering of hired farm laborers. The precise standards were tailored to each farm’s context and translated into a work plan agreed to by the farmer and against which performance was evaluated.

Additionally, CI provided training courses in the villages to the farmers, cooperative managers and technicians on organic farming methods, tree planting and pulping methods, and quality control. Business planning and management courses were given for the cooperative leaders. Further more, CI tried to select one model farm in each community as a demonstration site for best practices.

On the Starbucks side quality was a major issue, therefore they had to be very clear on the standards to be achieved. They informed them to CI, who sampled and graded every lot delivered by a farmer up to the point where every single bag could be traced. Farmers received feeback on any corrective actions that would improve quality.

In August 2000 the partnership was extended for an additional three-year period, with Starbucks contributing US$600.000 and four key elements to focus on:

• Extending CI’s and Starbucks’ work with farmers to promote conservation in a wider range of global biodiversity hot spots.
• Supporting the introduction of a year-round product line that reflected Starbucks’ commitment to alternative environmental agriculture and socioeconomic improvements in certain coffee-growing regions.
• Developing coffee-sourcing guidelines that incorporated sound environmental management practices and provided fair conditions to farmers.
• Seeking to engage other leaders in the coffee business in a collaborative effort to articulate industry-wide guidelines for environmental and social quality.

We're getting really close to the ending of this case; soon I'll tell you more about the outcome of the project... in the meantime, I'm really looking forward to hearing your impressions!