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Weigh in: Share your advice for the Fire Roasted Coffee Company here .

THE FIRE ROASTED COFFEE COMPANY

Business Summary

Entrepreneur: Founder/owner David Cook, 37, has an extensive business background in management and marketing, after a seven year career with Sobeys Inc. Most recently, he was merchandising manager, responsible for 25 to 30 Sobeys and IGA grocery stores in Ontario, providing advice and coaching on how to improve sales and profitability

Passionate about coffee, he started roasting beans in a frying pan at home. He first sold coffee at his street's garage sale and was amazed that people paid $10 a pound for it. Realizing there was a demand for his product, he opened a booth at the local farmers' market. After juggling the Sobeys job and the coffee business for a year, he quit Sobeys in May, 2007 to work full-time on growing Fire Roasted Coffee. Cook says his role is to lead production, sales and drive new business. Sales have quadrupled in one year since he went full-time.

Education: Cook went to Georgian College for business and trained as a chef at the Southern Alberta Institute of Technology (S.A.I.T.).

The Company: Fire Roasted Coffee is a Canadian company that wholesales and retails organic and fair trade coffee, offering over 60 different types of coffee from 40 different countries. As a certified fair trade company, Cook pays a standard price to coffee producers who provide good working conditions to employees and produce coffee in a sustainable manner. This means he pays roughly $1 more per pound, in contrast to the more conventional price, which varies according to the type of beans.

Cook says his company is seen as the independent alternative to the big companies like Starbucks and Tim Horton's. Since his company was invited into the University of Western Ontario, he hasn't had to bid against the big guns, but he replaced Nestles as a supplier for Western's facilities and Tim Horton's in the café run by Western's Hospitality School. He also just closed a deal with Fanshawe College where his coffee will replace Starbuck's coffee.

Founded: 2006. The company is not incorporated at this point although Cook plans to incorporate soon.

Home base: Fire Roasted Coffee has one location, called the Art Roastery Studio, in an industrial park in London, Ontario. He rents 12,000 square feet for $1,000 a month and estimates he'll need twice as much space next year.

The products: Hand roasted organic and fair trade coffee beans from around the world. The company roasts to order — 'just-in-time inventory' — so the product the customer gets has been roasted within the last 24 hours. Retail prices range from $13 a pound up to $30 for beans from the Gallipolis Islands or Blue Mountain coffee from Jamaica. Wholesale prices for cafes range from $9 a pound to $24 for the more exotic beans. Retailers make about a 30% mark up on beans; much more on selling brewed coffee.

Staffing: Fire Roasted Coffee has two full-time roasters who also help with website orders and studio sales plus part-time help on weekends to sell at the farmers' markets — a total of five employees. Cook handles "everything to do with the business", including all of the accounting, business development as well as orders and sales. He uses a courier service to deliver most of the orders, but still delivers key accounts himself.

Distribution: Mainly in and around London including Waterloo, Windsor and through a few contacts in Toronto. Fire Roasted Coffee roasts 3,000 to 4,000 pounds of coffee a month. About 5% is distributed through his website, 5% through his studio, and 45% through the company's numerous retail channels and 45% through direct sales at three farmers markets. The wholesale trade is growing the fastest.

Wholesale: Specialty retailers, grocery stores, cafes, catering companies and recently, the University of Western Ontario facilities and convocation events and Fanshawe College. Cook will also supply coffee to Western residence cafeterias in the fall and has started discussions about supplying Fanshawe College and Sobey's urban stores as well. Product volume has been driven mainly by the upscale cafes and retailers.

Retail: The company operates booths at three farmers' markets: London Farmers Market, Pinery Antique Flea Market in Grand Bend and Trail's End in London, averaging 1,000 cups of coffee a weekend. They also sell to customers at their Art Roastery Studio location and online from the company's website.

Sourcing: Cook gets his beans from two or three key wholesalers in Canada and also sources directly with the producing countries. Cook says he hopes to partner with other roasters to get volume to the point where they could start shipping containers of coffee directly. Advice on the best routes to take in establishing direct trade with producing countries would also be welcome.

Who are the consumers who drink Fire Roasted Coffee? Cook says the people who drink his coffee are: youth, especially university students, who are knowledgeable about product sourcing; young, working professionals who want a quality product that's produced in a sustainable and socially acceptable manner; and the boomers (40-55) who are looking for an affordable, handcrafted product.

Investment: $100,000 from personal finances and credit

Inventory: $30,000 to $40,000 of green coffee beans in the warehouse plus $15,000 roasted in play throughout the area.

Equipment: Fire Roasted Coffee has three coffee roasters worth about $30,000, brewers and grinders worth about $5,000 and one company van.

Revenue: With the new contracts with Western University and other big institutional accounts, the company expects to break even and show their first profit this year. Cook says there is a very good profit margin in coffee. He has always kept his retail prices under the market and feels strongly about sharing fairly with the people who grow the coffee

Franchising? Cook has not acted on it. He says he would need advice before trying it and would only want people who were passionate about fair trade coffee, not just after a profit.

Goals: Cook would like to be Ontario's fair trade roaster and to service a growing regional base of coffee lovers. His main focus is in developing the wholesale side of the business by establishing contacts with key retailers throughout the province. In the next year, he wants to establish a stronger presence in the Toronto market. He says he has no aspirations outside Ontario.

Main challenges

Growth: The company has been strongly pulled by growth — about 400% this year and an expected 200% to 400% next year. While he says it's tempting for him to move into a retail environment (like Starbucks), the advice from his wife and friends have been to focus on wholesale.

Financing: Rapid growth has created a financial strain on the company because they have had to increase the inventory and staff. Cook says he's put everything on the line and that makes him a little nervous. He says, "I've never been busier and I've never been broker."

Marketing: Cook has done little PR to market the company. Mainly, it's been word-of-mouth by customers and introducing people to the product at markets. They have not yet gone out to aggressively seek business. Cook says there is a huge amount of opportunity because there is no one else his size pursuing the business in the London market (and not much competition elsewhere in Ontario either). That why he thinks he's been able to grow so rapidly without marketing or a sales force.

Advice wanted from the panel

How fast should the company grow?

Currently, Fire Roasted Coffee only has one location. Cook wants to set up small roasteries throughout Ontario, continuing with the same hand roasting of coffee beans, so the company becomes the local fair trade roaster in different communities. He does not want to upgrade the machinery to the point where it becomes automated. He also believes that it's better to be somewhat exclusive with the product and not dilute it by offering it all over the place. He asks: How quickly can they maintain growth in their niche market?

Should Cook accept capital investment to grow the business — or not?

Cook has local business people who want to invest in his company. He thinks capital investment would allow him to add the staff needed for growth — possibly in marketing, sales and for the website — and to upgrade his machinery to deal with the larger volume the company is experiencing. So far, he's held back from accepting investment because there's been so much growth potential in the company that he didn't want to offer other ownership. But, he wonders if he is missing opportunities because he won't take the money. He's concerned that with a wide open market for his product, if he doesn't capitalize on it, somebody else will.

Where should the company focus their marketing?

Cook says he needs advice in this area. What are the key marketing strategies he should focus on? Should he bring in a marketing person or focus more on his website? He also needs to put together a strong presentation sales package for the larger institutional clients who are showing interest in his products. So far, he's just gone in with his coffee for them to taste and talked about it. With limited resources in a small company, he says he needs to pinpoint where he'd get the most response.

Website: fireroastedcoffee.com