Cover Photo: @yardstickcoffee/Instagram
Photo: @yardstickcoffee/Instagram
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Yardstick Coffee co-founder Andre Chanco on the benefit of a diverse business portfolio and why you must put people first in the hospitality world
Until over a decade ago, the local coffee scene was dominated by international chains that offered drinkable brews in cookie-cutter settings, which were fine. Filipinos are naturally sociable beings who appreciate a comfortable place where we can gather, and these cafés provide just that, along with hot cups of coffee and tasty nibbles. Eventually, third-wave coffee companies started to gain traction, offering the same convenient haunts but with much better coffee.
Yardstick Coffee is one of the home-grown pioneers of third-wave coffee offering fresher and better quality products to an enthusiastic local coffee-drinking market. Co-founder Andre Chanco reflects on their journey with us, ruminates on how the industry is changing and growing, and offers us a taste of what is brewing.
Who are the people behind Yardstick Coffee?
Yardstick was started 11 years ago by Kevin Tang, Jessica Lee, and me. Kevin is our CEO and also looks after our B2B business, specifically our coffee equipment distribution business. Jessica handles our backend and finance, while I look after the coffee part of Yardstick—sourcing and roasting, the cafés, and brand and marketing. Most recently, we have split the equipment business as Standard Supply Studios, so both the equipment and the coffee sides of the business can be a lot more focused and strategic. Apart from the three of us, we do have a strong and capable management team that runs the day-to-day. And now that the company is over a hundred people strong, everyone contributes in their own ways to keep things running smoothly.
How did you get into the coffee business?
Kevin, Jessica, and I went to university together in Singapore and have always wanted to do something together in the Philippines to somehow make an impact back home. Speciality coffee was slowly sprouting in different parts of the world in the late 2000s, and we were just timing it right for the Philippines.
Prior to Yardstick, I was roasting for one of Singapore’s pioneering speciality coffee companies, PPP Coffee. That was for three years before the stars aligned when Yardstick opened in November of 2013. We timed this carefully after observing the local scene with early players like Craft Coffee Workshop in New Manila paving the way, and we also heard of rumors of Toby’s Estate opening up from Sydney. The path was slowly being built by our peers, and that was very encouraging.
What has Yardstick’s journey and growth been like over the years?
From the get-go, we designed the business to be wholesale and B2B-first, as this could allow us to scale slowly while having a greater impact on the broader industry. Our Legazpi Village cafe in 2013 was a showroom, our roasting production space, and also our training facility. It was never meant to be a cafe, but of course, as people started to visit, they expected us to offer more than a simple coffee-only menu.
The Yardstick coffee bar inside Cartel Deli is a great story in a sense that it started off with a wholesale coffee relationship with Apartment 1B back in the day, then they asked us to run the coffee operations inside Cartel Deli. It shows how relationships are important in our industry, and we are super grateful for all the relationships that we have built over the years.
The turning point for Yardstick was being able to survive COVID-19. The pandemic was challenging for many in the hospitality and food & beverage industries, and we saw this with a birds-eye view since we worked with a broad set of clients in both industries. In hindsight, we are lucky to have survived the pandemic because we had several revenue streams and did not put all our eggs in one basket. Having said that, post-COVID-19, our revenue was 80 per cent contributed by our B2B equipment and coffee business, while retail covered about 20 per cent. That made us realise not to be overly dependent on the B2B part of the business, so since then, we have opened seven new cafés and also gave birth to Standard Supply Studios to focus on the equipment distribution.
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Having said that, you continue to expand your B2B, like your partnership with Max’s Group. Could you tell us more about that?
As mentioned, this was our bread and butter from day one. The reason why we focused on B2B since our inception was knowing that we could not move the industry forward just by ourselves. If we were able to support restaurants, hotels, and cafes in their coffee program, then they would be able to enlarge the pie for everyone to benefit from. B2B is also very challenging because it relies greatly on quality coffee, trained people, and good equipment. If one is missing, then it will have an impact on the cup that the customer drinks.
Another recent challenge with the B2B model is that some coffee drinkers get confused if we are operating or supplying an establishment. Companies like Blue Bottle Coffee dropped their wholesale coffee program after some time due to the logistical and branding challenges presented here. We’re taking a more proactive approach by putting up guidelines for wholesale partners, and also by offering coffee training as part of our holistic support.
We have had many great partnerships in the past and present, and some of our previous clients have started roasting coffee for themselves. Most recently, one of our more visible clients has been the Max’s Group. Personally, this was very fulfilling as there is so much nostalgia and memories with both brands that we work with. Professionally, it was very encouraging to see heritage brands improve on their coffee offerings. Apart from the Max’s Group, we also support over 100 independent cafes and restaurants with coffee and equipment. Some choose to display and market that they are serving Yardstick coffee beans, while some utilise our Orange Label program, a.k.a. our white label program, to put their own branding on the bags of coffee.
What’s fascinating is that not many people know that our main business has been B2B, which only means that there is room for growth for the company. We have been extremely grateful for our clients who have put their trust in us because we know we don’t have the most affordable offerings.
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As one of the pioneers in the local third-wave coffee movement, how has the industry evolved from when you started up to the present?
The industry has changed significantly since 2013, and it was not only because of Yardstick, but a collective effort across the board from the farm level to further down the chain. Even with the advent of international brands setting up shop, those have contributed positively to the coffee scene in Manila and key cities around the Philippines.
One of the biggest changes that I have observed (and tasted) is the improvement of the quality of Philippine coffee. When you look at farm-level initiatives by Kalsada, The Dream Coffee, and Finca De Garces in Bukidnon, the Philippines is now producing green coffee quality that is nuanced, free of defects, and consistent. We’re still struggling to produce enough, but the origin-side of the industry has made great strides since.
The next significant change has been the local palate being a lot more discerning. This is due to a combination of locals being able to travel abroad to taste coffees from various specialty coffee roasters and cafes. As important, coffee drinkers and enthusiasts are now being treated with a selection of freshly roasted coffee from companies in the Philippines. Before, you had to ship these in, and sometimes, the coffees may get delivered late due to logistical constraints. Now, you get to order and brew freshly roasted coffees from many great specialty coffee roasters in the Philippines, showcasing local and coffees from various producing countries.
Lastly, the emergence of an active and vibrant home brewing community has been pivotal. Some point to COVID-19 as the starting point, but this has been ‘brewing’ over the years, and now we’re feeling the benefits of having an engaged set of coffee brewers. Coffee education and brewing great coffee at home has now been democratized, which is pushing the quality forward for both the industry and consumers.
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In your opinion, what are your contributions to the local coffee/beverage industry?
At a community level, on a yearly basis, we organize the Philippine AeroPress Championships where we send representatives to the World AeroPress Championships. This is fulfilling because for one day a year, we get a room full of 200 people, from the industry, peers, competitors, sponsors, and home brewers all having serious fun.
Another contribution, I hope, is that we continue to take risks. And that comes with the name, Yardstick—that we’re always trying to be a better version of ourselves than yesterday. We take risks in bringing in new technology from a coffee equipment perspective; our retail shops are a never-ending A/B testing exercise to gather data about local preferences, and also learn about the challenges that our wholesale partners are facing. Not everything that we do works out well, but we take whatever we learn and make improvements on the next project. I think this start-up, iterative mindset is challenging in a brick-and-mortar environment, but it’s something that I personally believe in to keep the industry and consumers engaged and progressing.
In our early years, we had a heavy focus on education. We were one of the very first to offer certified courses under the Specialty Coffee Association. We are currently tweaking how we deliver education to the coffee enthusiasts and industry because coffee education has now become more accessible via digital content and various physical channels. We still see this as a critical component to what we do, but with a change of mindset from “translating” what we do and why we do things, rather than a top-down approach of “educating” people.
How do you think both the private and public sector can improve coffee farming in the country and the industry as a whole?
There have been many established systems that we can learn from bigger producing countries like Brazil and Colombia on how both the private and public sectors can work together. There are also learnings from our neighbouring countries like Thailand and Indonesia. From our perspective, to improve local farming, it’s a trifecta of financing, logistics, and also education across the supply chain. The reason why we don’t own a farm is that it’s very challenging to navigate. We are grateful to have strong farmer relationships, and nurturing these relationships for the long run should hopefully make an impact. Eleven years ago, we had zero Filipino coffee in our warehouse, and now we have about 20 per cent sourced through local partners, and we’re looking to nurture and grow these partnerships.
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What are your future plans or dreams for Yardstick?
At a personal level, my business partners and I want to be able to build a company that can support ourselves, while staying true to our vision. It’s a very difficult industry to be in, and passion alone is not enough for anyone to make an impact in a lifetime. It has to be sustainable for us, our employees, and our partner network.
We always believe that we are in the hospitality business first, before the coffee industry. People are what drives the industry and our business. With that, we’re learning about what it takes to be an employer of choice for someone that wants to work in coffee, or we can also be a stepping stone for someone before they move on to work elsewhere locally or abroad. This is easier said than done and it requires several years to be able to build systems to attract, retain, and train talent.
For the brand, we do wish for Yardstick to have an international presence at some point in the future. We don’t know what shape or form this may be, but we see the brand at an international level as a platform for Filipino coffee and hospitality. (Crosses fingers).
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Jaclyn Clemente Koppe is a food and lifestyle writer, as well as a consultant to some of the country’s beloved food and beverage brands. Her passion for food and drink is only surpassed by her devotion to her family, most especially to her soulmate, Pepa the poodle.
