A Coffee Buyer’s Glossary of Contract Terms

Poor-Quality Samples & Contractual Requirements

Setting certain quality standards can be an important part of building a contract between a coffee buyer and seller. It’s important to remember the various roles that contributors along the supply chain will have in terms of quality. For example, a farmer may not have any control over the timeliness of ocean transit or the screen sizes of beans. Keeping this in mind, contracts and expectations should take into account when and where the coffee is sampled, and who is responsible for its quality preservation at any given time.

coffee bags

A common term used in contracts is SAS, or “Subject to Approval of Sample”. This is where a buyer will sign a contract with a seller in advance of receiving a sample. However, fulfillment of that contract is dependent on approval of the sample. The buyer does not need to purchase the coffee, or justify their decision, other than by saying that the coffee does not meet their quality standards. (Although feedback to the seller can be quite useful for them.)

SAS terms may be “no approval, no sale” (NANS). Alternatively, they may be “replace” (or “repeat”), meaning a new pre-shipment sample would be offered in place of the rejected sample. In some cases, a seller might offer multiple options for the buyer.

When a PSS is approved and the coffee is shipped but arrives in a different state than expected (e.g., diminished sensory quality or higher physical defect count), arbitration is often not necessary (and, in my opinion, should be taken only as a last resort). More frequently, shipments of a disappointing physical or sensory quality can result in a quality “claim”. This is where the buyer requests a discount on future purchases or a partial refund from the seller. These disputes can often be resolved amicably if communication channels are open and clear.

Prev3 of 9Next

Leave a Reply

Your email address will not be published. Required fields are marked *