Keep Cup brews up value from international trade

Melbourne startup now sells to 33 countries

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Online international trade has enabled Melbourne-based reusable coffee cup manufacturer Keep Cup to offer its product in 33 countries while keeping manufacturing of the cups in Australia.

Speaking at a PayPal panel discussion in Sydney, Keep Cup COO Jamie Forsyth said the startup began in 2009 when he was running a café chain with his sister.

“We saw the huge amount of waste we created with disposal cups and we were going through hundreds of thousands [of cups] a year,” he said. “We had a look around for a suitable reusable cup and didn’t find anything that was designed for the espresso market.”

Forsyth decided to create his own sustainable cup in 2009. He received a $30,000 design grant from Melbourne City Council. Over the years, Keep Cup has received an export grant because it manufactures in Australia.

“That [export] grant has redeemed some of the costs of marketing the product overseas,” said Forsyth.

KeepCup is a PayPal customer and accepts payment via the service in a number of currencies including the Pound, Yen and United States dollars.

“Technology is crucial in cross border trade because it allows us to communicate in foreign languages, sell in foreign currencies and get our message out to a global market. [PayPal’s] Seller Protection service means it’s less stressful for us to trade in countries that we’re unfamiliar with. We sell in 33 countries and we don’t often know a lot about those markets and the risks," he said.

According to Forsyth, the cups have proven popular in overseas markets such as South Korea, Japan, Canada and New Zealand.

While Melbourne is still head office, Keep Cup has opened satellite branches in the United Kingdom and the US.

“We’re planning on growing our European and American businesses in the coming years and to continue to develop great products. We sell our product back to China which is a little bit unusual,” he joked.

“A lot of people can’t believe that we make the cups in Australia. What we have found since trading is that we can charge a premium [for the cups] which is higher than the saving we would have made by manufacturing the product offshore.”

However, Forsyth said that he would like to see some effort by the Australian government put into lowering the costs of intellectual property protection as the costs are “very complicated.”

“You typically need to go to a high price lawyer to start understanding IP protection,” he said.

While there’s an old saying that imitation is the most sincere form of flattery, Forsyth has moved to shut down Chinese counterfeiters that produce imitation Keep Cups.

“Our position is to continue to innovate and change the product.” For example, the startup moved from manufacturing plastic cups to glass six months ago.