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Key Idea: Customize For Key Customers

Customization for customers is the best way to fend off competition and it is the secret to earning millions from repeat sales.  Angel Souto is in charge of sales at Cafe Pilon.

Key Question:

A: 

Cafe Pilon sells more to regular customers by customizing for them.  The company has two types of customers. They sell to retail outlets such as grocery stores and convenience stores where customers purchase coffee in the sack and take it home to brew it themselves.  

They call the other type of customer, institutional. Restaurants, cafes, coffee shops, hotels and even hospitals, brew up the coffee and serve it prepared. While the retail customers all have the same products on their shelves, institutional customers may ask for special treatment.

Cafe Pilon creates a special blend for institutional customers. For example, Versailles, the restaurant and cafe, we visited has its own blend.  By doing this, Cafe Pilon protects its accounts.  The competition doesn't know how Cafe Pilon makes its special blend for Versailles and it would be a bit difficult for them to find out. If Cafe Pilon was selling to Versailles what they sell in grocery stores, competitors can buy that product and analyze it.

Unless an employee provides a sample of the coffee grounds before it is brewed, competitors could only drink the finished product and try to guess about how it was blended. We have looked at many companies on Small Business School who have secret formula, or trade secrets, and the famous brand that does this is Coca Cola.

Providing a custom product for customers makes it difficult for competitors to copy but it also forms a stronger bond between you and your customer. You spend time creating the product by testing it with their customers or in this case, the owner of Versailles may have been very active in the development of the blend. When a competitor calls on Versailles' owner and says I have some Cuban coffee for you to try, that owner will probably say he is not interested because he has his own special blend.

Think about it

Do you customize for key customers?  Should you customize for key customers?  

Clip from: Cafe Pilon, Rowland Coffee & the Souto family

Meet the three Souto brothers; lovers of freedom.

Miami: In this episode, we open with pictures from 1961 just before Castro forced his ways into the homes and business of this family. And though he took over everything, he could not take over their spirit. This family left behind all their worldly possessions but came to the USA with their greatest possessions -- their integrity, their love of family and friends, their creativity, their love of Cuban espresso coffee, and the knowledge needed to rebuild their family business from scratch.

Meet the Souto family, owners of Rowland Coffee Roasters in Miami.  They started with a coffee delivery business, bought Rowland, then Cafe Pilon, then Cafe Bustelo,  Medaglia D'Oro Espresso, Java Cabana and more.

Go to all the key ideas and video of this episode...

In memory of José Angel ''Pepe'' Souto, the Patriarch of the family who died at the age of 91 on November 18, 2007.

Cafe Bustelo Inc.

Rowland Coffee Roasters, Inc. Javacabana.com, BusteloCool.com

5605 NW 82nd Ave
Miami, FL 33166-4000

Visit our web site: http://cafebustelo.com

Toll Free: 800-990-9039

Business Classification:
Beverages: Coffee

Year Founded: 1962

Customize For Key Customers

HATTIE: (Voiceover) Cafe Pilon has two types of customers. Eighty percent of sales come from grocery stores. The other 20 percent comes from cafes, coffee shops, restaurants and even hospitals. These institutional customers serve up the brew one cup at a time and help drive grocery sales. We went into the Versailles bakery and we had cafe con Leche. So is that your customer?

ANGEL: (Voiceover) That's right. And Versailles is our number one customer. Basically what we do is a special blend for them.

HATTIE: So is this one of your customer-service techniques, that your big customers will come to you and say, `I don't want what you're doing for anybody. I want my own blend?'

ANGEL: That's right. They came to us about three years ago and they wanted to make up special blend for them and that's what we're doing right now. And they're very happy.

Unidentified Man #1: Because it's very energetic. You know, and it gives you a lift.

HATTIE: Oh. It gives you a--averted energy.

Unidentified Man #2: I got a piece of paper at home, the coffee's good for the sex, believe me. That's right.

Unidentified Man #2: I read it. I heard that. I read it in the Miami Herald. Unidentified Man #1: Yeah.

HATTIE: So you have coffee or you have Viagra?

Unidentified Woman: Coffee's cheaper.

Unidentified Man #3: The Souto nice people.

Unidentified Man #3: The family Souto very nice people.

Unidentified Man #1: And they started on the bottom.

HATTIE: Yes. We know that. We know that.

Unidentified Man #1: They are hard-working people.

HATTIE: And you keep them in business because you keep drinking five, six, seven cups a day.

Unidentified Man #2: I drink eight to 10 every day.

ANGEL: And also we do service on their machines, which is a very important part in the institutional end of it. (Voiceover) And when the machine breaks or it's malfunctioning, what they do is they call us at the office and we send a technician down there and we fix the machine.

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