One of the coffee producers in East Java province in Indonesia is Magetan Regency. The majority of coffee processing industries in the region are small and medium industries. Limited capital, knowledge and technology make them limited in processing waste including coffee pulp. This research aims to analyze the potential for utilizing coffee pulp which can be implemented sustainably by small coffee processing industries and provide additional income. The method used is analytical hierarchy process (AHP) with expert choice software. The most effective use of coffee skin waste for small coffee processing industries is cascara. The results of the mass balance balance analysis in 1,000 kg of Arabica coffee production produced coffee beans with horny skin or coffee with hard skin (HS) with a water content of 5.83% of 283 kg, solid waste 726 kg, coffee processing wastewater 1,613 kg. Cascara showed the highest financial feasibility where an NPV value of IDR 1,368,544,232 was obtained; IRR 52%; B/C Ratio 6.08; and PBP 0.90 or 10 months. The calculation assumes that the production of cascara tea is sold out at an interest rate of 10%.