Down a sleepy alley off 20th Street in midtown, in a nondescript brick building, the Pachamama Coffee Cooperative is radically changing the way 140,000 coffee farmers from Peru to Ethiopia bring their beans to market.
Pachamama will unveil its new retail and wholesale showroom tonight for the Second Saturday Art Walk, pouring several of its all-organic roasts for the public between 5 and 10 p.m. at 919 20th St. (Enter on the alley between I and J streets.)
CEO Thaleon Tremain formed the co-op in 2001, working with coffee collectives in Mexico, Guatemala, Nicaragua, Ethiopia and Peru. While agricultural co-ops are nothing new, Pachamama or Pacha, for short is unusual in its multinational scope.
Pachamama's business model also sets the organization apart. It is farmer-owned and, as such, its members invest in all branding, marketing and distribution efforts. That structure shifts the crop from a commodity to a market-ready product. Growers receive all proceeds roughly $8 per pound and, in turn, reinvest a portion of their profits back into Pachamama.
It's a bottom-up approach instead of a corporate trickle-down, said Tremain, who first worked with agricultural co-ops in the 1990s as a Peace Corps volunteer to Bolivia specializing in small business development.
"When you begin to sell a brand, you're a price-maker and that's where the value is in coffee," he explained. "Farmers have the opportunity to market themselves directly, and there's a growing consumer base that wants exactly that."
Pachamama began selling coffee in the United States in 2006, starting with the Davis Food Co-op, and maintains a regular presence at the Davis Farmers Market. Locally, its 11 roasts are sold in bulk at the Sacramento Natural Foods Co-op for $13.89 a pound, and in packages at area Nugget Markets.
"It's a little expensive for coffee, but I can tell you right now that every different Pachamama coffee has a distinct taste to it," said John Thompson, bulk buyer for the Sacramento Natural Foods Co-op. "It's a more premier line of coffee than (what is served in) coffee shops."
Pachamama's unroasted beans are exported from secondary co-ops in the five member countries, roasted by Thanksgiving Coffee Co. in Fort Bragg and distributed mainly to natural-foods stores in California and 15 other states though the company's e-commerce efforts, including a monthly coffee-by-mail campaign, are gaining steam.
Tremain declined to release sales figures, but said Pachamama has recouped its $500,000 startup cost half of which came from the farmers and the other half mainly from grants and is now "self-sustaining."
Until now, Tremain and his two-person staff mainly coordinated sales, marketing and distribution from his property in Newcastle. They moved into the two-story midtown building in April, in part to make inroads among restaurants, coffeehouses and other potential customers in the region. The 2,000-square-foot space, with its high wooden beams and ample natural lighting, will double as a gallery showcasing photos of Pacha farmers and a tasting room for clients.
Sacramento is well-suited to Pachamama's farm-to-mug approach, Tremain said. It's a good coffee town, he said, and it's home to a sizable population of foodies who like to know where dinner is coming from.
"With consumers' desire to know their farmers and to make that connection, I think we have a good opportunity," agreed Pacha's outreach director, Mollie Moisan.
With funding from the World Bank, Pachamama has created several high-tech tools that let customers learn about the farmers behind the coffee they've purchased, using bar code scans that link directly to growers' pictures, brief biographies and even online tip jars. Pacha's photo page at traceablecoffee.org, for instance, includes growers like Francesca Minaya, who grows two types of coffee beans on her 5-acre property in the Peruvian Andes, and has received $65 in tips to date.
Pachamama bills itself as the largest farmer-owned co-op in the United States. Kevin Edberg, executive director of the Minnesota-based Cooperative Development Services, agrees that the business model is uncommon both in its global reach and in its cooperation among so many large and small collectives in the five overseas member nations. Edberg has also seen firsthand the benefits of direct ownership, particularly the larger profits.
"To us, it's a cup of coffee. To them, it's clean water for their village or it's education for their kids," Edberg said.
Eric Stromberg, general manager of the Davis Food Co-op, has picked coffee in Peru on two separate occasions and has witnessed the improved living conditions among the Pachamama farmers. When he visited the remote village of Agiyloc 10 years ago, homes lacked indoor plumbing. Health care and education were luxuries.
When he visited a year ago, Stromberg learned that some families have sent children to college. The village co-op purchased a bus for trips to the closest town. Parents' new worry: Their college-educated children may opt not to return to run their family farms.