Meet Luc and Pierre – Chapter 3: What are the biggest challenges for business owners

From: Financial Consumer Agency of Canada

Transcript

Text on screen: The Financial Consumer Agency of Canada presents Money Break: A series on financial wellness, Coffee edition

(A commercial coffee roaster mixes coffee beans.) 

Text on screen: Bluebarn Coffee Roasters

Chapter 3: What are your biggest challenges?

(Luc sitting in a sunny room.)

Luc: There are numerous financial challenges that we need to overcome to be able to have a business like ours. Among other things, one of them is the fact that we’re a new company and a small company. For example, we just bought a commercial building in the village of Wakefield, where we’re going to move over the next few months. But since we’re a company with less than 3 years of history, banks aren’t really ready to lend us money, even though our growth is going really well and our accounts are good. It’s still difficult. So we need to depend on the private sector for funding. 

(Pierre sitting in front of large burlap bags filled with coffee beans.)

Pierre: There are a lot of barriers for new roasters, if you want to compete with the best in the region. So it takes money. You need to be able to buy your roaster, first of all. You need to be able to buy all the equipment that goes with that. So before your first day of work when you start your business, you’ve got to spend, say, $100,000. So not just anybody can do that. 

Luc:  Most coffees that we sell become available at the same time of the year, so it’s really cyclical for us. There are highs and there are lows. It’s really about ensuring that we’re not going to hit bottom, basically. 

Pierre:  Well, as you can see, there are a lot of things to buy. So it’s a business where cash flow is really a problem. Even if things are going well, if you have to buy coffee for $40,000 next week, it needs to be in your account. So that’s it. It’s really about having money to do what you want to do every day, but also to be able to do big projects that excite you. So as much as you can dream, you can have passions, it’s not necessarily enough to start a coffee brewing company that will be competitive.

Text on screen: How do you overcome your challenges?

Pierre: You want to have the best equipment to make the best coffee. For Bluebarn, you absolutely have to have a budget. You have to know how much money there is in the bank account.

Luc:  Your really have to be ready, be on guard, keep an eye on your finances, because you never know what could happen. I don’t want to miss my shot, but you have to plan pretty strictly for the next 3 to 6 months, but it’s rare for us to look past that.

Text on screen: Money Break 

canada.ca/money-break 

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