Your Banker Doesn't Care

Well not really. What your banker doesn't care about is how many grams you are using for a double shot of espresso... they don't care whether the water temperature is 198 or 203, and they don't care about Cup of Excellence, Fair Trade or Organic. They don't care how many twitter followers you have, how you placed at the Regional Barista Championships or your industry status. They care whether you are making money, and whether you are a good credit risk. No matter how involved we become in discussions about coffee quality, best practices or sustainability, the 800 pound gorilla in the room is your income statement. If you are a business owner producing the finest coffee in the world but you are not making money, you are doing something terribly wrong.

Every coffee business owner should spend at least as much time considering the quality of their financial statements as they do their products. None of us stepped into the coffee industry armed with vast amounts of knowledge, and in fact for most of us, accumulating coffee knowledge and experience is an ongoing process. The same can be said for Financial Literacy, it is the process of accumulating knowledge which benefits our business.

If you are a coffee business owner or manager at the helm of a struggling company, the tools to change the outcome are contained within your financial statements. Goal setting, target ratios and identifying problem areas all become easier when you become familiar with the look of your financials. Please review the posted pages with relevant definitions as well as the sample Income Statement, and Sample Balance Sheet.