Liability in Coffee

Liability in Coffee

The coffee industry is unusual. Over the years, for a variety of reasons, the supplier/customer relationships between roasters and cafes (and also consultants and cafes) has grown deeper and deeper.

The root of this depth was, for a long time, control. Creating a dependent relationship, where the cafe needed the supplier for everything from product, to cups, to the knowledge of how to actually produce a cup of coffee properly. When what you sell is commoditised, then it is hard to stop a customer switching to another supplier if the price is better. So roasters created a mindset in their customers where they were afraid to adjust their grinders, or change brands because they accepted the endless free branded items. Cafes ended up feeling that the customers first and foremost loved the brand of coffee they served, and so to change the brand was to risk losing their customers. This strategy continued with roasters ultimately bribing customers with free equipment, so that they’d accept lower quality coffee. (Let’s just call that what it is)

It is considered very normal for a new cafe owner to get a great deal of advice from their supplier. Everything from equipment choices, bar layouts, menu creation, pricing structures, staff training and retention. There is a problem with advice like this – it has the potential to have grave consequences.

Professional Liability or Professional Indemnity insurance exists for those who give professional advice. I believe roasters fall into this category, and consultants obviously do. There are a lot of coffee consultants, but I’d be willing to bet that less than 20% of those who list that in their bio online carry the insurance to protect them from being sued should someone construe their inputs as damaging to their business. I don’t know many roasters who carry this kind of insurance either. Some roasters may have this as part of the existing insurance, but it is something worth checking with your insurer.

You’re thinking, quite rightly, that you’ve never heard of anyone being sued for giving bad advice in the coffee industry. Neither have I. However, I still believe that many markets are likely to see a contraction as cafes close due to being unable to find enough customers to be sustainable. People are going to lose money. I suspect some will be angry, and might look for someone to blame. Perhaps I’m speculating, perhaps you think this is fear mongering. Nonetheless, the basic principle of insurance is the ugly idea that you’re willing to bet a certain amount of money that something is going to go wrong.

I write this because it seems worth bringing attention to. It comes with the unfortunate news that you can’t insure yourself retroactively. If you’ve given advice, in a professional capacity, then you’re still liable for it and there isn’t much you can do.

I’m not suggesting you go out and purchase insurance right now. I am suggesting you should think about it, about the nature of the advice you give, and how responsible you feel for that. Whether or not you live in a litigious country, whether or not you feel that lawsuits are too easily brought, it seems wise to at least know what you’re getting into.

Thank you to Marshall Fuss for insight and feedback on the topic.