Lavazza Talks Coffee, Sustainability, and Supply Chain

May 5, 2022

Most Americans can't imagine starting their day without coffee, and with 90 percent drinking that coffee at home, according to Statista data, grocery retailers with a strong coffee assortment can position themselves to capture that market. IGA's newest Red Oval partner, Lavazza, is family-owned—like many IGA stores—and is ready to serve independent retailers and their shoppers.

IGA's VP Business Partnerships Heidi Huff spoke to Lavazza's VP U.S. Retail Michael Tysiak about the brand, their latest ready-to-drink offerings, and how Lavazza has been addressing supply chain issues.

What makes Lavazza coffee different from your competitors?

We are a family-owned coffee roaster located in Torino, Italy. We are the third largest coffee roaster in the world and we bring an “authentic Italian coffee experience to the world.” The Lavazza brand created the idea of blending beans from around the world to create consistency with our blends.

Our brand is available in all the different brewing methods: ground drip coffee, espresso, K-cups, Nespresso-compatible capsules, ready-to-drink, and available in both whole bean and ground forms. Lavazza is also excellent regardless of brewing method: drip, espresso, mocha pot, pour-over and French press.

Are there any product innovations you're working on that you'd like to share?

We are currently launching our ready-to-drink format, which will have four flavor blends: All blends will be available in 100 percent organic (Classic, Cappuccino, Nitro and Double Shot with Oat Milk). These blends are hitting retail shelves in May and June.

In addition, we have recently launched extensions to our Tierra Organic line of whole bean and ground coffee in 10.5 oz bags: Tierra Amazonia (a single origin blend from Brazil) and Tierra for Planet. Both are 100 percent certified organic.

Why is the independent sector important for your business? 

The independent sector serves a breadth of shoppers from various communities. Larger and national retailers serve a needed purpose, but can also be very rigid and inflexible when servicing the needs of specific communities. Lavazza's legacy has been very strong in the Italian-American population and the independent sector has been critical in getting the necessary reach in those communities.

How do you prioritize independent retailers to ensure they have equal access to your products (compared to national chains)? 

While we are an international company, we are still relatively small in the U.S. market. Our heritage in the U.S. started 25 years ago in the independent channel. Independents are where our roots lie, and we are committed to continuing the strong relationships that we have created over the years.

How can our retailers ensure shoppers know they carry your brand? 

The Lavazza U.S. brand is still very much in a “start-up” mode as far as promotion and advertising in the U.S. market. We have healthy trade promotion budgets and we will continue to drive awareness via roto, circulars, and digital advertising campaigns.

Additionally, in 2022, we have a total advertising and promotional budget that exceeds $38 million and will be close to $50 million in 2023. Our commitment to grow awareness and trial on our brand is unsurpassed in the coffee category. When consumers try our brand, they tend to stay with Lavazza as their coffee brand of choice.

Do you have any resources our retailers can use to help maximize Lavazza product sales in stores? 

Lavazza has a category management department that delivers the latest in planogram, merchandising, and display insights. We are available to provide those insights as part of our business partnership. In addition, we utilize Crossmark Brokerage, which has a strong retail team that provides in-store activation, demo, and sampling programs that we can tap into to bring additional trial and awareness.

How have you been impacted by supply chain issues, if at all? 

The supply chain issues have hit all CPG companies with regards to transportation, supply chain, and labor. Of course green coffee prices have risen dramatically over the last year. They have begun to stabilize and our modest price increase have covered our increased costs.

These cost increases, however, have not stopped Lavazza from investing in our supply chain. Beginning in March of 2022, we opened our first manufacturing plant in the U.S. in West Chester, Pennsylvania. This plant will manufacture all of our 12 oz bags (our best selling items). In addition, this plant will help us continue to help the planet by reducing carbon emissions as a LEED certified plant and by cutting our supply chain time from Italy by roughly three months. More flexible supply in the U.S. along with a more sustainable supply chain means better service to our customer and a healthier planet.

Questions about Lavazza products? Contact Lavazza's Vice President of U.S. Retail Michael Tysiak, your regional sales representative, or Crossmark team member.

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