An office coffee maker can be your best friend when you’re yearning for that revitalising cup of joe after your lunch break. When your food coma sinks in, a good cup of coffee from a high quality espresso machine or coffee brewer that is conveniently located in your office pantry is a real lifesaver.
In this article, we explore the various ways to get yourself a solid office coffee machine by exploring considerations around the free on loan, coffee machine rental, and purchase models.
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The free on loan model has fast become one of the most popular methods to acquire an office coffee maker, mainly because there is no upfront cost to be incurred. This is a great way of getting a good office coffee maker as it offers a hassle free approach to equipping your office pantry with a coffee machine. There is no upfront fee, and the maintenance is taken care of by the coffee supplier.
At its base, the coffee machine free on loan model is a spin-off of the coffee machine rental model and loosely operates on the principle of a monthly minimum order quantity. This minimum order quantity refers to the number of consumables such as coffee beans that your office would have to purchase from the office coffee supplier on a monthly basis to justify the placement of say, an espresso machine, in your office for free, by your coffee vendor.
Different coffee machines, depending on the size, price, and capacity, would command a different minimum order quantity as part of this free on loan model, with a more premium machine, typically corresponding with a higher minimum order quantity.
As nobody likes to purchase more coffee beans than required, it is important to work out from an early point, whether or not your average office coffee consumption corresponds with the minimum order quantity for a particular machine.
In most cases, the office coffee suppliers have already worked out what is a realistic amount of coffee that can be served in an office of a particular size, and as such, the asking minimum order quantity will usually tally with a machine whose capacity fits your office well.
To work out what your office’s average coffee consumption is, you can base it off the number of cups of coffee your office consumes in a day, and multiply that by the number of working days that your office operates. As a quick example using an office of 30 pax, with each person drinking one cup of coffee a day, would show:
30 pax X 1 cup of coffee per day X 20 working days = 600 cups of coffee
After deriving this, if we assume that each cup of coffee utilises 10gm of coffee per serve via a bean to cup automatic espresso machine, the total consumption of coffee in this office would be 6000gm or 6kg worth of coffee beans.
In Singapore, the average price of coffee beans from an office coffee supplier is around $30 - $35 / kg. If we use that figure, then the estimated amount that this office would spend on consumables is approximately $180 - $210 per month. With this in mind, it would be perfectly reasonable for this office to take up a free on loan contract with a coffee vendor that is worth around $200 / month in minimum order quantity.
In the same vein, it would not be viable for this same office to get a coffee machine that is worth $700 / month in minimum order quantity for two main reasons. Firstly, an office with 30 people would find it very difficult to consume up to $700 worth of coffee a month. Secondly, the machine offered as part of the package is likely very high capacity or very premium and would be underutilised in an office that size.
An example of a free on loan office coffee machine: Nuova Simonelli Pronto Bar.
With all that out of the way, you can use these steps to identify the wide range of options for an office coffee maker. Although this model is applicable to almost any office coffee machine and brewing system out there, it is most commonly applied to coffee machines that are more expensive to purchase outright, such as fully automatic espresso machines, bean to cup coffee machines or commercial espresso machines.
There would be little sense in taking up a free on a loan package for say, single-serve coffee makers, which are already extremely inexpensive to purchase outright. Most free on loan office coffee packages have a contract term of between 12 to 36 months depending on the machine and the supplier.
In the event that your office is unable to hit the minimum order quantity for a given month, it is not uncommon for the coffee supplier to either charge a small coffee machine rental fee for that given month, or to roll your contract for an additional month.
Because the business of handing out free on loan coffee machines to offices is an expensive one, with a slow rate of return for the coffee suppliers, such a model is usually only offered by the larger and more established coffee suppliers who have the financial capability to support the model.
Bravilor Sego Coffee Machine is a popular choice when it comes to free on loan package.
Renting an office coffee machine was traditionally the more favoured format, but in recent years, has been losing out to the free on loan model.
Just like the free on loan model, renting an office coffee maker covers various brewing systems that offer different brewing options, with no upfront cost. It also operates on a contract of between 12 to 36 months, and the maintenance is also taken care of by the office coffee supplier.
The main difference here is that instead of being held to a minimum order quantity, you pay a monthly flat rental fee for the coffee machine itself, and you can decide how you wish or need to spend on consumables such as the coffee beans.
As with any model, there are some pros and cons to the office coffee machine rental format. Aside from the obvious advantage of not having a minimum order quantity to worry about each month, there is also the possibility that says for appearance sake, your office would like a high end, premium automatic espresso machine, but perhaps cannot hit the minimum order quantity that the coffee machine demands.
Using a rental format, you can pay the flat monthly rental fee, and ignore the fact that the machine is underutilised in your office. The format allows you that flexibility, provided you have the budget. The downside is that when you pay for a flat monthly rental fee for the coffee machine, the amount could have gone towards buying actual coffee beans for your consumption, under a free on loan model.
As this model is not as expensive to maintain for the coffee suppliers, it is normally offered by most coffee vendors out there, even the smaller and more speciality ones.
This office coffee maker was said to be one of the best machines for offices.
In recent years, many office coffee vendors have come up with hybrid formats, based on the best parts of the free on loan format and the office coffee machine rental format. This is good news for the consumer, as the market is now more competitive, with a wider range of packages to suit more specific needs.
For example, there are coffee suppliers who are now offering a monthly flat-fee subscription, where you will get the free use of a bean to cup automatic coffee machine, as well as a fixed amount of coffee beans.
Should you require more consumables, you can order them as needed, based on the list price. There is still a contract of 12 months, but there is no minimum order quantity, and you have the flexibility to decide how much you wish to spend on coffee each month.
The package is also scalable, where multiple machines can be subscribed for, depending on how big an office you need to support. In this manner, it is actually better for you. In a usual situation, a large office of 300 people may have to share a single high powered super-automatic espresso machine.
In this scenario, they now have 2 - 3 separate office coffee machines to brew coffee with, thus minimising wait time during peak hours, and increasing productivity.
Another interesting hybrid format is an incentive-based rental format, where the package that you sign up for is essentially an office coffee rental package, with a fixed monthly rental fee. However, if an office happens to be able to hit a consumption target for the month, say $300 in that month, the office coffee supplier will actually waive the rental fee for that month.
This is a great format if you have made some conservative calculations on the amount of coffee your office drinks a month, but do not want to risk any shortfall, and would instead prefer to passively hit the targets for a rental waiver every month.
The reality is that doing an outright purchase on a coffee machine is probably the cheapest method of acquiring an office coffee maker in the long run. However, in today’s climate, cash flow is just as important as anything else, making the above-mentioned formats great options. Whatever your preference in terms of brewing system, brewing options, and brew strength, there are definitely options that can be considered without having to purchase the machine.
Drop us a message below if you are keen to explore any of the options discussed.
OCM was started in 2007, focusing first on coffee machines, then marketing for coffee and food and beverage companies. Check out this restaurant marketing guide to learn more about the many campaigns and companies we have worked with.
OCM has also created many marketing workshops and classes for the F&B industry. Many of the modules are running in the Singapore Skillsfuture Classes in tertiary institutions such as Temasek Polytechnic Skillsfuture Academy and also ITE College East COC classes.
For the readers (coffee lovers), we continue to share coffee articles (and videos) and have also started a free coffee class section (with free online coffee training supported by coffee partners).
To connect with coffee and F&B practitioners, join our growing F&B group on Linkedin (20 000 and growing).
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