[Congressional Record (Bound Edition), Volume 160 (2014), Part 3]
[Senate]
[Pages 4253-4254]
[From the U.S. Government Publishing Office, www.gpo.gov]




                         VERMONT COFFEE COMPANY

  Mr. LEAHY. Mr. President, Vermont is known for its small and large 
businesses alike. Vermonters take pride in buying locally, and as a 
result, businesses like the Vermont Coffee Company have been able to 
expand and become forces in their respective industries.
  When Paul Ralston started the Vermont Coffee Company over 30 years 
ago in the small town of Middlebury, VT, he did so based on the belief 
that coffee creates community. Today, he continues his commitment to a 
high-quality farmer-friendly coffee blend by using only fair trade, 
certified organic coffee beans from around the world.
  Paul's passion for coffee has created an opportunity for him to forge 
his own path to success, and he has expanded Vermont Coffee Company's 
distribution to retail outlets throughout the Northeast and along the 
Atlantic coast. His business continues to expand, and his success is 
just one hallmark of the respected Vermont Brand. I congratulate his 
success, and I ask that the text of an article appearing in the 
Burlington Free Press on February 20, 2014, about his success be 
printed in for the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

            [From the Burlington Free Press, Feb. 20, 2014]

         Middlebury Coffee Roaster Still Growing After 30 Years

                          (By Melissa Pasanen)

       Middlebury, VT.--Vermont Coffee Company in Middlebury was 
     ahead of the curve when it started roasting organic, fair 
     trade beans 30 years ago. Its continued success is based on a 
     simple philosophy.
       In the front hall of Vermont Coffee Company's offices and 
     production facility, dozens of photos of happy people, some 
     with coffee cups in hand, smile down from the wall.
       In keeping with the company's longtime tagline--``Coffee 
     roasted for friends''--these are not just customers, founder-
     owner Paul Ralston clarified on a recent tour: They are 
     friends.
       ``Before there was Facebook,'' Ralston, 61, said. ``We had 
     our friends' wall.''
       Ralston has always been a little ahead of the curve, since 
     his first foray into roasting coffee beans some 30 years ago 
     as a tiny bakery-based operation.
       There have also been plenty of curves in the road he has 
     traveled since then, but this year Ralston expects Vermont 
     Coffee Company to purchase half a million pounds of green 
     coffee beans, which will be roasted in its recently doubled 
     15,000-square-foot facility and shipped to accounts ranging 
     from a small, highly regarded group of New York City coffee 
     shops to Costco.


                             Coffee culture

       It was during his ownership of Bristol Bakery from 1977 to 
     1983 that Ralston first stumbled upon the smoky and aromatic 
     process of coffee-roasting in Manhattan's Bowery neighborhood 
     while shopping for used bakery equipment. The smells conjured 
     up memories of the strong espresso his Italian grandmother 
     carefully brewed every Sunday when he was a child.
       When he came back to Bristol, Ralston serendipitously found 
     a classic turn-of-the-20th-century roaster, installed it in 
     the bakery's front window and began roasting

[[Page 4254]]

     batches of green coffee beans well before the trend of small, 
     local coffee roasters swept the country.
       After selling the bakery, Ralston returned to school at 
     Burlington's Trinity College to study business administration 
     and planned to pay some of his tuition bills by running a 
     Church Street espresso cart. But Starbucks was just opening 
     its first Seattle coffeehouse and most people didn't know 
     what to make of his cart. ``It was a huge flop,'' he said 
     ruefully.
       More than a decade went by, during which Ralston spent time 
     in the San Francisco Bay area working in nonprofit arts 
     management and appreciating the region's vibrant cafe culture 
     before he and his wife, Deb Gwinn, returned to Vermont where 
     he helped grow the cosmetics and skincare company Autumn Harp 
     to $6 million in annual sales. That led to a job with The 
     Body Shop in England where, he noted, ``There was a coffee 
     drought, so I drank tea.''


                            Brown-bagging it

       In 1997, Ralston and Gwinn returned again to Vermont and to 
     the antique Royal Roaster #4, which had been gathering dust 
     in their Bristol garage. ``I hooked it up in the garage and 
     started roasting and taking the coffee to gatherings for 
     feedback,'' Ralston said. As he developed his new business 
     idea over the next few years, he kept things simple, both by 
     design and by default.
       Like back in the Bristol Bakery days, Vermont Coffee 
     Company used brown paper lunch bags to package the coffee and 
     a friend made a rubber stamp to label the bags. ``The brown 
     bag was the starting principal,'' Ralston said. ``When you 
     would get something fresh and from a local shop, there 
     wouldn't be a lot of packaging.''
       ``We started with just dark and decaf,'' he said. ``What 
     else do you need?'' And the coffee was available only as 
     whole bean. ``We refuse to grind coffee. As soon as you grind 
     it you start the staling process,'' Ralston explained.
       Ralston's approach was also influenced strongly by his 
     former boss, Body Shop founder, Anita Roddick, who he 
     described as ``a pioneer in trade, not aid,'' cultivating 
     mutually beneficial trade relationships with developing 
     countries and communities to help them become self-sufficient 
     rather than simply providing financial or other aid. When he 
     first told Roddick he was thinking of getting back into 
     coffee, he recalled that she said to him, ``Your coffee 
     should be 100 percent organic and 100 percent fair trade.'' 
     There wasn't a brand like that at the time, ``and it turned 
     out there was a good reason for that,'' Ralston said. 
     ``Everyone thought I was nuts. At the time, organic was just 
     gnarly vegetables.''


                         Window of opportunity

       Count Vermont coffee expert Dan Cox among those who thought 
     Ralston was a little nuts. Cox had been the first full-time 
     employee of what was then Green Mountain Coffee Roasters. He 
     worked there for a dozen years before he founded his own 
     Burlington-based coffee-testing business, Coffee Enterprises, 
     which does analysis for many major national coffee companies. 
     ``Paul came to me and said, I want to learn everything about 
     roasting,''' Cox recalled. ``He told me he wanted to be like 
     Peet's [a leading San Francisco Bay area coffee roaster], 
     which is like the Guinness of coffee. I said, This isn't the 
     Bay area. The East Coast is not into dark roast. Like with 
     Guinness, for every customer you turn on, you'll turn four 
     off.'''
       In addition, Cox remembers Ralston outlining his ``folksy'' 
     marketing plan with the brown bags and emphasis on selling to 
     friends. ``I said, That's a little far-fetched, pal.' And he 
     said, That's all I've got.'''
       Ralston spent six months learning how to evaluate green 
     coffee beans, blend, roast and control quality and despite 
     Cox's initial concerns, he carved out a niche and grew 
     steadily. ``He was still there in five years and then another 
     five,'' Cox said. ``He was very savvy, always asking for a 
     better way to do something . . . and he has stayed true to 
     his style. His packaging is still relatively unsophisticated 
     but it works for him. He makes a respectable coffee and a 
     pretty darn good decaf.''
       A few other factors worked in Ralston's favor, Cox added: 
     ``Number one, he had a passion for it, and number two, nobody 
     really came right after him. He had a window of opportunity 
     that doesn't exist today.''


                              Solid focus

       As Cox noted, the competitive frame is very different today 
     with new micro-roasters popping up regularly, but Ralston has 
     stayed focused on his initial vision.
       Since its official launch in 2001, Vermont Coffee Company 
     has expanded to retail outlets all over Vermont, as well as 
     New York, Massachusetts, Connecticut and New Hampshire with 
     distribution growing at a healthy clip around the Northeast 
     and down the Atlantic coast. The company has about 23 
     employees, about half of those full-time and many part-time 
     by choice, older and partly retired or younger with children. 
     ``Part of our business model is a flexible workforce,'' 
     Ralston explained.
       Ralston, who is sole owner, would not share sales figures 
     but Vermont Coffee Company projects 20 percent growth in 
     2014. The flagship line of retail packaged whole beans 
     remains simple and straightforward in its descriptors: Dark, 
     Medium, Mild and Decaf. The down-to-earth brown bag packaging 
     remains, although it takes the form of a brown box for 
     Costco.
       With the exception of one line from the Dominican Republic, 
     rather than emphasizing single-sourced coffees from specific 
     regions like many other small roasters, Vermont Coffee 
     Company has always led with its blends.
       ``We are blenders. There's nothing magical about our 
     beans,'' said Ralston. ``The goal is to keep our blends 
     tasting the same, month to month, year to year.''
       Vermont Coffee Company buys certified organic beans 
     following principles set by the International Fair Trade 
     Federation, Ralston said. The annual coffee harvest occurs at 
     different times in different climates and over a year beans 
     could be sourced from Ethiopia, Indonesia, Peru, Bolivia, 
     Guatemala and Nicaragua, among other countries.
       The beans are stacked high in burlap bags in a large 
     storage room in Middlebury all tagged with their country, 
     producer, and lot number. As he demonstrated how the beans 
     are pulled for evaluation through a long hollow spiked tool 
     that can dig deep into each bag, Ralston explained how 
     different beans contribute to the overall blend. Coffee from 
     Guatemala, for example, he said, ``We call them our spice 
     beans. They add fruity and floral notes.''
       The company's modest marketing budget still emphasizes 
     grassroots relationship-building (now via social media), 
     coffee sampling and offering loyal customers Vermont Coffee 
     Company merchandise such as t-shirts and mugs for returning 
     proof-of-purchases, which they do by weaving strips of brown 
     bags into quilts, folding them into origami and even, in one 
     case, using them to craft a collage of Johnny Cash drinking 
     coffee--black, of course.
       Another thing that has not changed, Ralston noted with a 
     smile: ``We always smell like coffee. When we go to the bank, 
     they know who we are . . . It's a sensory business. We're in 
     it for what it smells and tastes like.''


                        Slow roast, slow growth

       Changes have come gradually, many in the form of process 
     improvements such as the adoption of the Japanese production 
     scheduling system, Kanban; new pieces of equipment to 
     mechanize jobs previously done by hand like bag-folding; and 
     increased roasting capacity.
       In the roasting room recently, a brand new, shiny stainless 
     steel roaster with capacity of 150 pounds was in the process 
     of being installed. It cost about $350,000 to purchase and 
     install and would double Vermont Coffee Company's roasting 
     capacity, Ralston said.
       ``The thing that makes it big, bold coffee is how we roast 
     it,'' Ralston explained, pausing in front of one of the 
     company's two smaller roasters where a small circular window 
     gave a peek into the pre-roasted, dull grey-green beans while 
     the glossy dark brown, roasted beans swirled below. Vermont 
     Coffee Company roasts its beans about twice as long as many 
     other larger roasters, Ralston said. He believes the longer, 
     slower roast is key to building rounded flavors, similar to 
     slowly caramelized onions or the depth of a long-cooked Cajun 
     or Creole roux sauce base. ``It's a long, slow caramelizing 
     roast,'' he said, ``which results in coffee with more body 
     and sweeter, chocolate, caramel notes and a smoky tang and 
     lower acidity.''
       With a similar careful approach, Ralston has planned and 
     budgeted for growth. Over his varied career, Ralston said, 
     ``I've made all the mistakes you can make.'' He has seen 
     firsthand, he said, that ``growth offers new ways to screw 
     up.''
       ``We follow a model called bootstrapping,'' he said. ``We 
     use yesterday's cash flow to finance growth. We're not 
     extravagant.'' The company's credit line, he said, usually 
     has a zero balance. An additional challenge these past four 
     years has been Ralston's commitment to the Vermont 
     legislature to which he was elected in November of 2010. He 
     ran, he said, because ``I think there is a need for more 
     people with active business experience in the legislature.''
       He feels good about what he has accomplished there, he 
     said, but it's been ``very hard'' balancing the four-month, 
     four-day-a-week commitment with running an actively growing 
     business. ``I think we would be further ahead if I hadn't 
     done it,'' he said.
       Looking ahead 15 years, Ralston said with a smile, ``I hope 
     to still be grooving on coffee.'' He also hopes to be able to 
     spend more time ``at origin,'' in countries where coffee is 
     grown. ``It happens to be warmer than here,'' he added.
       At home in Vermont, Ralston imagines a slightly bigger 
     office ``with a wood-burning stove, a couch and a bigger 
     coffee table where friends will come by to visit and sit to 
     have a coffee.''

                          ____________________