Chch cafe in Lonely Planet's top 12

Addington cafe profits go to producers

TESS MCCLURE
Last updated 05:00 02/12/2013
Age Palmer
STACY SQUIRES/Fairfax NZ

BRIDGING THE GAP: Cafe manager Age Palmer outside the coffee co-op on Lincoln Road.

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Five years on from its beginnings in the industrial suburb of Addington, the Addington Coffee Co-op has become one of the city's most popular cafes.

Named by Lonely Planet as one of the country's top twelve places to visit, the managers estimate they see more than 1000 customers through the door on busy days.

A business begun by a group of friends with no experience in the cafe industry, no-one was more surprised by the cafe's success than the owners.

"When we started, we estimated we might make 60 coffees a day, and 30 breakfasts," manager and co-founder Age Palmer says. "Now, we're doing 600 coffees a day, and 400 meals."

But perhaps more surprising than the business's success is its unusual business model.

Calling themselves "a people-focused business", yearly profits from the company do not go to shareholders or owners, but are rather returned to the partners who produce the cafe's wares.

Over the last five years, fair trade audited co-ops and businesses in Mexico, Ethiopia, and India have put the funds toward building medical facilities, schools and growing economic capacity.

"Fundamentally, the crux of the business is that we work for our partners," Palmer said.

"It's not a matter of generosity. It's about the profits of a business going back to the producers to whom they really belong. We don't believe we're giving the money away; we're just trying to correct the imbalances and give them back what they rightfully deserve."

The umbrella company that owns the cafe, Addington Store, adjacent laundromat and fair trade apparel company is ‘Liminal 8024', named for an architectural term that means bridging or transitioning between spaces.

Palmer says the co-op aims to do just that - bridging the gap between global need and local business.

"We believe profit and people are not mutually exclusive, and that people matter. If they're supplying us products, we want to take into account the actual true cost of that."

While the returns do not stay with shareholders, Palmer emphasises the co-op has a profit focus.

"It's not a charity, it's a business, and one of our core aims is to make a lot of money on behalf of our producers."

The shareholders agree that dividends from the now highly profitable business cannot be taken by investors.

Instead, 70 per cent of the profits is distributed to overseas and local partners while the remaining 30 per cent is invested back into maintaining and growing business facilities.

One of the business's most recent local investments was to purchase a piece of land in Little River, and use it to begin growing produce for the cafe's kitchens.

The farm supplies breakfast eggs from 100 free range chickens, and has begun growing corn, courgettes, lettuces, artichokes, and pumpkins for the kitchen. Organic waste from the cafe then returns to the farm to be composted.

As well as cultivating a more sustainable and local approach to food, the owners hope to create jobs working in the gardens.

"Our aim is to try to create as many jobs as we can, both here and overseas." Palmer said.

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Trade Aid Importers food manager Justin Purser verified that the co-op had been distributing funds to Fair Trade certified overseas producers.

"We're really happy to have found another company who shares the vision to support small scale producers in the developing world to improve their lives," Purser said.

Five years on, the business has redistributed hundreds of thousands of dollars overseas, and employs 40 local staff.

Palmer sees the key as offering a viable product that is not reliant on the charity of customers.

"The key thing is that ethical business doesn't have to rely on people's goodwill. It can actually provide products and services that are useful and commercially viable," he says.

"Why can't sustainable trade and business compete with the best of them?"

- The Press

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