3FE & Colin Harmon
Food & Drink

3FE

The best, the smartest and probably the most-hyped coffee house in Dublin.

I’ve been in and out of this place for the past two years and have been watching the business grow and develop with interest over that time. They recently made a great 15 minute video (Vimeo) on the business and their journey from being closet-coffee geeks to successful entrepeneurs.

3FE will be regarded as too cool for school by most Dublin folk and will be too far out of the way for many others. Most won’t be prepared to pay 3 for a coffee each morning (I hear some local NAMA folk have dubbed it ‘3 Feckin Euro’) and for this reason I think its interesting to see this business thrive and prosper in today’s market. There are many reasons why the business should struggle to survive but yet it hasn’t – it’s actually doing the opposite. So kudos to Colin Harmon, his team and his fellow shareholders.

Take the time to learn the taste of proper coffee

If you don’t know 3FE then you should go out of your way to try it. Just make sure you take your time as its not a place to rush in and out of. Along with Coffee Angel these guys make the best coffee in town and I recommend taking the time to try a filter coffee or one of their ‘sets’. Their food offering has really improved in the recent months also but it is pricey/premium – just like everything else they do.

Whilst 3FE is known as a coffee shop the business that underpins the brand is actually positioned as: “Baristas | Wholesalers | Trainers | Consultants”. Colin Harmon and his team are the suppliers and consultants to many other coffee enterprises such as Cup on Nassau Street and Base WFP in Ballsbridge. They train staff to be expert baristas, supply the HasBean/3FE beans, help source the equipment and provide overall consultancy on the service offering. It looks to me like they have up to a dozen businesses who have benefitted from the 3FE support.

 A 360 Degree Approach to Coffee

What has become quite interesting now though is the recent move into roasting their own beans. Up to this point they started out with the HasBean brand which they imported from the UK. Before Christmas the 3FE roastery was launched and now the business will be stocking and supplying its own roasted beans instead of the HasBean brand. This appears to have two key benefits for 3FE:

  1. They get to earn a better margin for themselves by taking the roasting in-house;
  2. The 3FE brand offering now becomes a more complete product and becomes a fully fledged coffee business rather than just a coffee shop on Grand Canal St.

Of course this doesn’t necessarily mean that the HasBean coffee gets ditched. 3FE is jointly-owned by the founder of HasBean Coffee in the UK and having successfully created that business in the UK he is repeating the trick with Colin Harmon in Ireland. The 3FE coffee beans are still essentially HasBeans but that they’re delivered to Ireland in their raw (green) state and left for 3FE to do the roasting. This arrangement should continue to suit both parties – it will give more cream to the 3FE business and in the long run ensure a greater supply of HasBeans into Ireland as the 3FE trade grows.

So its a smart move on the business model and it looks like the timing is good for them. As they grow their reach both in Dublin and outside of Dublin (& the economy improves) then 3FE should succeed and prosper. However, its not all sweetness and light in the business; here’s a few observations, gripes and suggestions I’d like to see them address.

FEEDBACK

Price: I can accept the premium product, the provenance, design, ethos and all the other good stuff. I can actually accept most of the prices they charge. However I think they need to continually be mindful of their price positioning and they should ensure all staff are conscious of it too. I don’t think it would hurt them or the brand in any way if they introduced a couple of subtle ‘price-conscious’ offerings. For example: 5 for a bowl of porridge is mad on its own (albeit very good) but add a coffee for €1.50 extra and I would happily pay the €6.50 and they should get a decent margin on that price too. They should do something similar with the lunch combinations. I reckon that offering more packaged selections like this would entice people like me to spend more.The lunch offering should give more ‘grab & go’ options too as the queues can put off many people who don’t want to wait in a dis-organised queue.

Brew Methods: My favoured coffee in 3FE is the filter method and they normally use an Aeropress to make it. From memory they used to offer the V60 and Chemex formats in the early days but these seem to have disappeared. I can only presume that these methods took too much time and therefore involved too much labour effort for a €3.00 reward. However I would like to see these brew methods return and I wouldn’t necessarily object to paying more for them. Maybe they could be offered in the off-peak times?

Service: sometimes I feel like there isn’t enough ‘hussle’ in the service, particularly in the morning rush-hour. I know this goes against the principle of taking the time to enjoy a quality tasting coffee and therefore I suppose its also a reminder to slow down and enjoy it all. Maybe the mood-music should be less chill-out in the morning and more high-tempo!

Innovate: I think there’s plenty of opportunity to continually engage with the customer who likes to brew at home as well as enjoy in the shop. Selling more products on the shelf (like Coffee Angel do) would be good. I also think they should do some limited-edition beans from time to time (Christmas, Easter, summer festivals etc). It would also be cool to do a different style of packaging for these beans – how about taking the colours from the shop front and doing a Navy-Grey pack with the 3FE symbol in gold – just like the name plate on the shopfront? That might really stand out on the shelf.

The Future is bright….

So where to next for the 3FE model now that they’ve got the farm-bean-to-cup business model in place? It appears expansion is on hold for a while so that they can bed down the business. This is smart and I would expect that while they’ve been chasing turnover for a couple of years it is now time to generate profits and then let that shore up the bank balances. With all growing businesses there must be various teething problems and growing pains behind the scenes too and it could take 12 to 24 months to deal with these. Therefore I wouldn’t expect much to more to happen in 2014. Thereafter they will need to deliver strong growth in the wholesale division to justify the investment and they must be planning to focus on the cafes, restaurants and hotels across the country who would fit the profile of 3FEs target market. No doubt they will also learn from HasBean’s growth experience who are a couple of years ahead of 3FE. A new website might also be in the offing to enable them sell beans and products to customers all over Ireland.

Of course they have the option to expand by opening more shops but this might not be the right way to go. They already ‘reach’ into 12 cafe’s through their wholesale, training and consulting and maybe this is the better route to go – it spreads the financial risk. Once you start expanding under your own label then you can often create a monster that always needs to be fed with more expansion! For a man who originally wanted to escape the grey suits of the financial world I very much doubt that Colin Harmon wants to create that kind of monster & who could blame him?

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One thought on “3FE

  1. Hi Conor,
    First up, thanks for taking the time to do such a comprehensive review. I’m still a bit overwhelmed that other people even know our shop exists so seeing something like this is a little daunting, but I’m happy it was a positive review for the most part.
    Your assessment of the business had a few little things I’d disagree with but overall it was a fairly accurate assessment of where we are. I’m gonna take that as an affirmation that we’re doing something right given the nature of your work. I wasn’t aware of the “3 Feckin’ Euro” nickname though, thats pretty funny actually!
    As far as your feedback is concerned, I’ll address each item separately as you have them laid out. I do appreciate all feedback, often its the bad feedback thats most valuable but harder to come by. All of the staff will also be sent a link to the review so they can gain a different perspective of what we’re doing so it will be very valuable to us in the long run. Here goes!
    Price: We actually addressed this a few weeks back and dropped the porridge to a very competitive €4. The sandwiches are also now available pre-wrapped as of last Monday and we have seen a huge benefit in speed of service at busy times. We also have a few combo offers on sandwich/soup/salads but if you didn’t know that I’m going to take that as a sure sign that we need to communicate it better.
    Brew Methods: We do still use chemex and Kalita(similar to V60) and never stopped using them. The aeropress is just the go to option for its speed and quality. All you need to do is ask the guys at the till. At the moment a chemex which gives you 3-4 cups is available and if you ask the guys for a single cup from the kalita they would be happy to oblige!
    Service: Yes, we addressed this issue a few months back and have made big inroads which have meant doubling our output between 7.30 and 10 in the last 3 months! There are customers that want the coffee as fast as they get it in a high street cafe but equally want it to taste as good as they usually get it at 3fe. Its impossible to do both of these things but I’d like to think we’ve come a long way in the last 3 months and will continue to improve.
    Innovate: I’m not sure this is the place to disclose numbers but I can assure you that you’ll struggle to find a shop in the city that sells more equipment/beans than we do. The numbers of late have been incredibly good and is driven by people coming every week to try different coffees. We have just ordered another shipment of chemed/kalita/aeropress equipment that we werent expecting to make until May at the earliest. As far as limited edition stuff goes, all of our stuff is limited edition in the sense that they’re small lots from small farms that last only a few weeks each. Since opening the roastery in December we’ve gone through about 20 different coffees and will probably do twice that in the next two months! The bag idea is a good one but is very expensive as you need to buy 50,000 odd bags at a time. In saying that we will be having new labels done up and have looked into doing seasonal blends for the future.

    I’d say you’ve pretty much summed up our plan for the next year or so in your outro but I definitely think we’ll surprise you with a few more tricks up our slieve. Thanks again for the feedback and best of luck with the blog! If you nab me in the shop some time I might talk you through the retail numbers 😉

    All the best,

    Colin

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