In February 2023, we officially founded the co.hilo Kaffeekollektiv cooperative, and since then, we can have members join us. We’re in September, and we have around 35 people who have signed up and officially registered as members, which is great! If you want to know more about the benefits of a membership, and how you can sign up to become a member, check out this page.
Our goal is to have at least 100 members by the end of this year. So if you want to understand better why we aim for that number, then stay here and read this article.
Why do we need more members for the cooperative?
In the past weeks, we have been in close communication with the auditor who’s responsible for evaluating our founding documents and approving our petition to register as a cooperative. There is some skepticism regarding our growth expectations, and that’s why we want to share this openly with our audience. After over three years of planning and organizing the founding of co.hilo as a company, we have made many exercises of prediction. It has now been one year since we started the process of becoming a cooperative, and we have made many iterations to our business plan. That business plan has a range of assumptions and goals that are connected. But the core assumption is that we need to grow to be able to continue.
In times in which degrowth gains space in the discourse for sustainability, growth seems contradictory. Why can’t we keep things small? Our dream and vision is to build a stable business both in Colombia and in Germany, in which people in both countries can work for a dignified salary while making a positive impact for sustainability. To be able to afford the fixed costs of this business while keeping a low margin that makes our product accessible to more people, we need to move more coffee through our system.
How much growth is enough?
There’s no single answer to this. We have studied many scenarios, but our current assumption is that 5 Tons of coffee per year (the whole production from 2-3 small-scale farming families) would be enough to fund 1 position (80%) in Germany with an average salary.
For the past 3 years, we’ve had 4-5 people working on a daily basis at least 30-40% of their time (sometimes also much more) for co.hilo as volunteers, plus many more who volunteered in weekly or monthly activities. Especially in the past year, we dedicated most of our time to preparing to found a cooperative: writing the statutes, organizing the paperwork, and working on numerous iterations of our financial plan. Some other factors also took a big toll on our capacity to make the business grow, such as the need to rename and rebrand our company, and, of course, the biggest one, the loss of our founder Martín. As a consequence, we’ve reached a plateau in our sales: around 1 Ton of coffee per year.
In our current assumption, our goal is to at least triple that in 2024 and to reach the first full-time employee in 2025. By the end of 2027, our goal is to have 3 full-time employees, close to 15 Tons of coffee/year.
How do we want to grow?
To put it simply, we need two types of growth:
(1) Members in the cooperative, which invest in shares.
(2) Clients who buy our coffee.
This year, we’re focusing on the growth in members. Why?
The two types of growth support each other. Since we started in 2019, we have financed our growth with our private investments. Just our sales margin is not enough for us to triple the quantity of coffee we buy from one year to another. In order to be able to grow our sales in 2024, we need to buy the coffee at the beginning of the year (the biggest part of the coffee harvest in Jardín happens between November and January), which means we need to have the capital available at that point in time – we usually ship coffee in January. So the investment of the shares will be used to include more families in the system and buy more coffee, in order to be able to increase our sales in 2024. We could go to a bank for a risky loan, but we chose the path of making it more collective and in accordance with our values.
Until we reach a point of balance, expected for 2027, we need to continue growing – both in number of members and in sales. To illustrate, our path of growth looks like this:
Of course, these are just numbers on a spreadsheet until we realize them. We know it’s not easy, but if there’s something we have practiced in the 4 years of co.hilo, it is our resilience and the need to focus on our bigger goal: to establish a stable and sustainable alternative system for coffee trade that generates a positive impact for the people and for the planet. This will only be possible with the support of many people who also believe in that.
To join us on this dream, check out our information page about the cooperative and sign up for a membership. It’s a one-time payment that can also make for a great gift for a loved one.
Thanks for reading!
