DEMAND, SUPPLY AND INTERMIDIARY IN THE COFFEE INDUSTRY: THE LAC SOLUTION

tuvic (44)in #coffee • 5 years ago

Coffee is a brewed drink prepared from roasted coffee beans, the seeds of berries from certain Coffea species. The genus Coffea is native to tropical Africa and Madagascar, the Comoros, Mauritius, and Réunion in the Indian Ocean.
Coffee remain one of the most sort after drink all over the world with the demand on a very high side but the supply is constantly decreasing and is not able to meet the high level of demand. According to the international coffee organization the consumption of coffee is growing annually by 2.5%.
Aside the problem associated with the supply of coffee there are other factors limiting the availability of coffee as expected, there is the problem related to the climate and insufficient automation in some regions of coffee beans, the quality of the supplied beans, poor infrastructure, consumer preferences, and the fact that there are many intermediaries who should be paid while exporting coffee, and, of course, constant price fluctuations. All these and many other factors contributes to the very low availability of coffee in the world thus causing a major problem in the coffee industry.
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FACTOR RESPONSIBLE FOR THE SHIFT IN BOTH THE DEMAND AND SUPPLY OF COFFEE

Earlier paragraph we talk about the increase in the demand of coffee which is met by very low supply , this can be as a result of any or more of the following factor:
• Coffee organization body: The union of coffee workers have a very vital role they play in either shifting the supplies curve to the negative(decrease in supply) or positive (increase in supply) side. And as we know that when there is an organised union for a particular commodity they help in regulating the price of such commodity so if the price is been inflated then the supply will be in shortage.
• Disease, pest and climatic condition: coffee is majorly produced from roasted coffee beans and what ever happens in the production of this beans has a very important effect on the availability and supply of the coffee in the market. Pest and disease infestation on this beans reduce the production level and thus low in supply of coffee. Also the climatic condition needs to be favorable to make availability of the roasted beans possible.
These said, there are also the factor that lead to the high demand of the coffee and they includes:
• High income of the consumer: As widely known coffee are taken by a very high population of office workers who prefers to take a cup of coffee rather than heavy meals for breakfast, it is also mostly served as relaxation drink in most companies therefore the increase in the income of these set of workers is likely to increase the demand of coffee because it means more money to buy what is termed as ‘relaxation drink’.
• There is also the notion that the price of coffee is likely to increase in the nearest future from what is said by many coffee drinkers, if so, there is the possibility that people will tend to buy more and more coffee now thus exceedingly increasing the demand for coffee as people will tend to buy now before the price hike. This will also lead to a decrease in supply (because firms want to hold onto it and sell it later at a higher price). This results in a rightward shift of the demand curve, and a leftward shift on the supply curve.

THE LOVE AIR COFFEE

All well said, if all the problems identified above are solved and nothing is done to the problem pertaining to the intermediary then nothing as been done and the coffee industry will still be experiencing failure. Therefore to solve the problem of the intermediaries (who should be paid while exporting coffee). The amount of money paid these intermediaries are on a very high side and it goes a long way to affect the price of coffee which in the long run affect the demand of coffee as people will now seek for the alternative instead of coffee.
To solve this, the LOVE AIR COFEE will be creating a blockchain application called the BLOCKCHAIN EVOL which through it customers can make orders for their coffee without the service of an intermediary. With this application customer can order for their coffee, choose the flavour they want and pay with the LAC token all through the blockchain application.

HOW ITS WORKS

The system negotiates with the customer the degree of coffee roasting. Then the customer will select the date and time of delivery, the system accept payments in LAC token and holds reserved for payment of the amount on deposit.
To deliver the coffee the company use the courier services and they check on them from time to time to know if they will deliver the order in time. In case of any delay in execution of the order, the system will contact the customer and assign a new date.
Note: the system will not disclose the customer’s information and address to anyone, the courier service only have the customer address at the stage of delivery.

To serve their customers better the company LOVE AIR COFEE developed and assembled a coffee roaster based on air technology, and roasted coffee on it quickly gained its popularity due to its taste, aroma and great benefits. As the air coffee itself could easily be replaced with a drum roaster coffee, they decided to create a brand, and implement a certain system into the product realization that helps control the authenticity of air roasting.
With the help of air roasting it is possible to:
• Minimize the number of defects that occur on the beans in contact with hot metal (cracks, grooves, charring, etc.), thereby preserving all the trace elements and minerals, which makes the drink much healthier;
• Ensure equal and high-quality roasting of the whole mass of raw materials, which has a positive effect on the taste of the finished drink, making it pleasantly soft;
• Avoid contact of the beans with smoke destroying their exquisite natural aroma;
• Reduce the duration of the procedure to 13-15 minutes;
• Regulate the intensity and degree of raw material processing, so that it can meet the demands and taste preferences of consumers to the maximum.
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