BSBRES801: Initiate and Lead Applied Research

Assessment task 2- Unit project

Title: Coffee Rome

Coffee Rome is a reputational coffee brand that operates 21,000 stores across the world. Along with
the coffee stores, the business also has a wholesale business of whole bean and ground coffee. Coffee
Rome operated as Franchise model. The company is known for its replicated consistency across the
globe. Franchising helps this company to access capital easily as well as reduces risks that would
tarnish its brand image

Background and Statement of the problems

Coffee Rome operated as Franchise model. The company is known for its replicated consistency across
the globe. Franchising helps this company to access capital easily as well as reduces risks that would
tarnish its brand image.

Coffee Rome’s primarily brands itself as a provider of beverages offering a more typical coffee house
dining experience. These firm’s locations are designed with their customer’s comfort in their mind.
Inviting Décor and the free internet provides with a more enticing option for people who looks for a
place to speak with friends, relax or read. All these attract customers who are willing to pay more for
quality services

Global demand for coffee is increasing, especially at the premium end of the market, by 1%–3%
annually. There is also rising demand for food, restricting the land available for coffee, so improving
farmers’ productivity is critical not only for their success but also to ensure long-term supplies. We
also need to assist the improvement of farm economics, enhancing the resilience and prosperity of
present growers and attracting the next generation of coffee farmers, particularly during the present
period of low coffee prices.

Following are the Global challenges Coffee Rome faces in the supply chain:
 • The first and foremost is the climate change. Coffee as one of the agricultural products fell
victim to the climate change impacts. Disproportional high attitude rains, extreme
temperatures, and severe hurricanes have enabled high-cost pests, and diseases onslaught
that directly impacts the coffee farms as well as the coffee yields.

• Logistics is the largest global challenge that faces Coffee Rome. Logistically issues of this firm
are only the starting point. The uncertainty especially when working with numerous
suppliers across the world is endless

 Another challenge that the company faced is the rising prices of the coffee beans. This has been
partly resulted by the increasing demand for the coffee beans. The Coffee Rome margins are
affected by prices hike of the coffee beans and the shortage in supply.

Supply chain risks that the Coffee Rome faces

Company identified the following major risks to coffee supply chain:

• Production risks

Drought

Pest and disease outbreaks

Erratic rainfall

• Market risks

Coffee price volatility risk

Steep and prolonged price fall o input price volatility

Counterparty risk o Exchange rate & Interest rate volatility

• Enabling environment risks

Reputational risk

Theft

Research question or hypothesis, aim and objectives

 How does chain supply management can change the sales revenue and its coffee
products?
 Due to the nature of the research, an empirical multiphase mixed methods approach was used to
examine different perspectives of the coffee supply chain to investigate sustainability implementation
and its effects on the coffee supply chain. A plausible explanation for this design is that different
groups of interviewees require different methodologies in order to fully access the most available
information and achieve the goal of the research.

 To centralise a system management on the logistics networks and supply chain across the
continents.

 To use digital technologies ensuring the Coffee Rome supply chain is efficient and that the
company can cope with the high-quality growing demand globally.

 To monitor the demand in real-time. Production, distribution, and schedules by doing so may
be modified and developed in the time of need giving the supply chain of the company an
added flexibility and allows Coffee Rome to address with agility peaks in demand.

 To supply chain management that pays attention on the innovation of supply chain and
logistics management to reduce energy consumption and control the pollution levels from the
transportation and production process.

 To reverse logistics that relates to the recycle of containers, packaging materials and the use
of environmentally friendly materials

 To corporate social responsibility towards farmers and environment

Research design

Qualitative research methodology

A qualitative methodology was utilised to examine the opinions of experienced professionals in well-
known coffee manufacturing companies and local coffee collectors. They have good knowledge about
the research topic and high educational levels that ensure the accuracy and reliability of the responses.
It helps to provide an in-depth investigation of the real impacts of sustainable certification practice on
their business, which quantitative questions cannot access and evaluate precisely.

Quantitative research methodology

A quantitative methodology was utilised to examine the current circumstance of sustainable behaviours
and how sustainability certification practices are measured in terms of farming methods, social security
and the knowledge of sustainable coffee production by farmers. They have experience of the current
situation and the basic knowledge to answer these simple and clear questionnaires. The information
produced by quantitative research is then used to run the regression, and run an ANOVA analysis to
check the relationships among the variables.
Study population and sampling

The population of the research

The population of the research is a collection of key stakeholders including coffee farmers, local coffee
collectors and five coffee manufacturing companies of Coffee Rome. The population excludes the
participation of final customers because 95% of Coffee Rome production is exported to developed
countries and consumption of sustainable coffee has increased significantly, as mentioned in the
literature review section. Hence it is quite clear that customers show considerable support for
sustainable coffee, and the development of sustainable coffee depends mainly on the collaboration of
the listed stakeholders.

Data Analysis methods and Instruments

To fit with the research design, the sample of the research comprised a group of private coffee farmers
in Rome whose coffee is partly or wholly sold to well-known coffee processing companies and the local
collectors for these farmers. It also included participants from five large coffee processing companies to
examine their opinions and experience with the purpose of analysing the current sustainability practices
of the coffee supply chain and identifying weaknesses in order to make improvements.

This is a purposive and controlled sample, so the surveyed participants needed to have a number of
characteristics:

In the interview with the coffee processing companies, interviewees had to be staff or former staff in
the purchasing department or in coffee processing factories in both Rome and Venice. They all had a
good understanding of the supply chain network and sustainability practices in the coffee processing
industry.

The survey of farmers had to be random and include both male and female workers. The surveyed
farmers could plant either sustainable certified coffee or normal coffee.

All the surveyed coffee growers and collectors had to wholly or partly sell their product to the factories
of these companies.

Mechanisms to assure the quality of the study

SUPPLY CHAIN MANAGEMENT

The information in this section is based on qualitative interview with local collectors and staff of a well-
known coffee processing company. When asked, senior purchasing executives and the production
supervisors of the coffee processing factory in Rome said that all the factory’s products were sourced
only from reliable local collectors, who had a very good relationship with the company. The company
deals mainly with these collectors rather than individual farmers, although they know that purchased
coffee needs to go through at least two lower tiers before them, which could increase the production
cost and reduce the value for farmers. However, because of coffee growers are small household
farmers, it takes more time to collect at their farms and they have to accept the need to pay more to go
through intermediaries. Chi square test results show that farmers who held a sustainability certificate
could more readily sell their coffee directly to coffee manufacturing companies than those who did not
hold the certificate.

In addition, these senior purchasing executives also mentioned that they were trying to set up a
traceability supply chain network for all coffee products, but this had not yet been put into practice.
Only few premium and high quality Arabica coffee products use this system to harmonise with the
requirements of certified coffee production in the project, coordinating with Utz Association. Finally, the
production supervisors said they were planning to gradually change packaging of the final product from
plastic materials to paper and recyclable materials up until 2020.

Ethical Consideration

 Farmers who grow fair trade coffee receive a fair price, and their communities and the
environment benefit as well. Fair trade certified coffee directly supports a better life for farming
families in the developing world through fair prices, community development and
environmental stewardship.

 Responsible conduct of research (RCR) is defined as "the practice of scientific investigation with
integrity." It involves the awareness and application of established professional norms and
ethical principles in the performance of all activities related to scientific research.

The Limitation of the Research

 The population excludes the participation of final customers because 95% of Coffee
Rome production is exported to developed countries and consumption of sustainable
coffee has increased significantly

 The sample of the research comprised a group of private coffee farmers in Rome whose
coffee is partly or wholly sold to well-known coffee processing companies and the local
collectors for these farmers
Resource require for the study

 The cost of each supplier

 The sales revenue of last three years of the Coffee Rome

References

 https://www.research.ucsb.edu/compliance/responsible-conduct-of-research