As a business, we do not insist on messy, complicated product supply contracts being signed by our customers. However, when a fully branded 'Ciao Coffee to Go' machine has been placed, we would expect that Ciao coffee and our dry ingredients, such as chocolate and milk, always be used and purchased from us.
1. Legal perspective
The most obvious reason is that as a retailer, you are advertising a particular brand which you are not serving your customers, our Ciao brand. By using other products (which almost always are a 'cheap' alternative), you are short changing your customer while potentially damaging our brand reputation. The legal term for this is 'Passing off' and we view this practice as IP infringement. In addition, you may be in breach of our registered Trademark.
2. How alternative products can effect the coffee machine?
Our coffee to go machines are designed and built to the highest quality standards. The brew group is set up to get the optimum performance from our Ciao Barista blend (or which ever blend is selected by our customer). All bean blends are different and changing the bean risks the coffee extraction being incorrect, either over or under extracted (too weak or espresso struggling to extract). The result of this often means a poor quality drink.
Using a cheap chocolate or milk powder can also present their own issues, such as the dry mix powder being too fine. This can cause short measure drinks and blockages (product dripping into the cup) and also shorten the life of seals in the mixing chamber.
Selling coffee to go, particularly Ciao, is hugely profitable. Selling a 12oz cup at a very competitive price of £1.50, costs an average of 22p per drink (including the beans, branded cup, lid, sugar, stirrer) which generates 86% POR. After VAT that's a generous £1.03 profit on average. By shopping around for 'cheap alternatives', you may save in the region of 2-3p per drink. Increasing the profit from 103p to 106p we'd suggest is a small short term gain when you consider risking your customer loyalty and repeat purchase potential if the drink doesn't compare favourably with your local competitors.
Just to add;
It can be costly to repair issues caused by substandard product use. We will not cover such eventualities in any warranty cover. We also reserve the right to cease maintenance support of your coffee machine for reasons detailed in section 1.
Our many loyal customers enjoy peace of mind and countless benefits when we work closely together. These can include;
- On-site warranty. Non supplies customers may risk voiding their warranty if substandard products are used
- Life-time equipment support. Non customer support assessed on a one by one basis, we may refuse support if our trademark is infridged
- Priority engineer call out. Non customers may take up to 7 working days or we may refuse support if our trademark is infridged
- 50% discount on engineer visits beyond the warranty. Non customers pay retail price list, double the cost
- 50% discount on spare parts. Non customers pay retail price list, double the cost
- Branding support and POS, most of which is without charge. No branding support for non customers
- Hot beverage category partnerships, insights and advice from the professionals. No category support and limited advice for non customers
- End of lease titles discount. Loyal customers pay as little as 1 month lease payment to purchase the equipment title, non customers pay up to 6 months.
We build and maintain excellent working relationships with our customers and work closely with them with the aim to develop and grow their hot beverage category whilst giving a second to non support service.
We would respectfully request that retailers inclined to save a penny or two on such a high marging product, not to consider our branded coffee to go solution from us.