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Italian coffee-shops are experiencing a downward trend in sales. As an answer to improve margins, then, some owners buy bad quality coffee to cut costs. Do you think this strategy is the right one?

In general, we all agree that lowering quality is a bad choice. Yet, we must face the fact that in this emulative society, quality often means different things to an expert and to the average consumer. "Bad coffee" - then - may become accepted and even preferred by certain public. For instance canephora has now become an acquired taste: people want it in ther blends, no matter what the "100%-arabica pundits" say.

Is this downward spiral going to help the Italian coffee-retail business?

When you price-compete you'll always find someone cutting prices lower than you can do. But lowering quality can be a fear response, a reaction to a receding market. And then there is the cultural heritage of XIX c. drugstores, selling cicory coffee at the price of (and allegedly as) the "real thing": the birth of brands was in fact generated by this lack of trust towards the mum&pop stores.

So low pricing and sparing on quality may be ok, for some. The issue becomes a real problem when bad quality turns endemic: the scene reminds me of those silent, comic movies in which our hero pulls the wrong lever, and holding it in his hands, looks shocked at us, while his plane starts to nose-dive.

Even in Italy Nespresso tends to dominate the capsule market. Many roasters , with a few exceptions, have decided to purchase filling plants and start selling Nespresso compatibles. How long will it last?

Nespresso sales grow every year by an amount higher than Illy's yearly sales, and equal to almost half of Lavazza's. An epic success, mirrored only by GMCR's in the US. Also, Nespresso has nurtured a very special, very close dialogue with its customers, and convinced them that Nespresso is coffee's nec plus ultra. These two aspects explain why 1) all roasters feel compelled to enter this market; and 2) they are confronted, once they're in, with a sticky Nespresso customer base.

How long the segment will last? You should ask this question to Nestlè, since they are the true wild card in this equation. What is on the record is the fact that they did not refrain from fighting hard: you can read the French Competition Authority report on Nespresso's market practises, in order to get a taste of the battle.

About the future some players remain optimistic, while others cite Putin's joke: "A pessimist is someone who, while sipping a glass of fine cognac, says: 'I can smell a hint of beetle stench', while the optimist cracks a beetle in two, sniffs it and says 'I can smell a senteur of cognac'. As my friends know, I like cognac".

I believe that the "compatible" business has almost reached a sort of moral, rebel-with-a-cause kind of status. A Swiss magazine - indeed - has titled after Star-Wars an article on Nestle's battles "The Empire strikes back" and - in that saga - the Emperor was not the hero. So, my I bet is that compatibles are here to stay. But I can understand why there are pessimists around. 

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