Potential Benefits for the Producer

Exclusive agreements are usually long term, and as such they can help create price stability. Several advantages follow from that:

• Focus on the coffee. The expectation of premiums allows producers to focus on the coffee instead of the marketplace, and to pay for the extra effort it takes to maintain quality.
• Loyalty and communication. Exclusivity creates a sense of loyalty and communication between the producer and the importer or roaster that may otherwise not be possible.
• Technical help. It is in the best interest of the receiving company that quality is optimal, so it may provide technical help and other assistance that would otherwise not have been available to the producer.

“Exclusivity creates a certain sense of loyalty and communication between the producer and the importer/roaster.”

Potential Disadvantages for the Producer

An exclusive arrangement may also limit the coffee’s exposure.

• Limited market reach. If the agreement is with a smaller company, or with companies with limited market share, the chance to create a broader consumer base is lost.
• Limited awareness when it ends. When the agreement comes to an end, the producer may be left with a coffee that enjoys only limited awareness and requires further effort to build market share.
• No guarantee of promotion. The producer relies on one or a few companies to promote the coffee, but generally has no guarantee that this will happen, or that it will be enough to be effective. Even though it is in the buyer’s best interest to ensure this, he or she may in fact not do so.