No ordinary Joes

No ordinary Joes

Monday, July 14, 2008

Vince Cannatella opened Coffee Call on College Drive in 1976. About eight years ago, a Starbucks opened up across the street. John Cannatella, Vince’s son and Coffee Call’s current president, says they weren’t as apprehensive as you might think.

“I guess we had a wait-and-see attitude,” John Cannatella remembers. He says they noticed a temporary dropoff in business, in part because Starbucks has a drive-thru. Coffee Call has one, too, but otherwise, he says they’re just fine doing things their way.

Cannatella cultivates a specifically Louisiana flavor, think beignets and café au lait, and sometimes that means deliberately going against the prevailing trend. Coffee Call stopped making espressos and cappuccinos a decade ago; if that’s what you’re looking for, Cannatella says he’ll refer you to CC’s.

“We are not the modern-day, Starbucks-type of coffee shop,” he says. “My dad taught me a long time ago, you find your niche and you do it the best you can.”

Hard as it is to fathom now, Starbucks opened in 1971 with a single location in Seattle’s Pike Place Market. Today, there are more than 15,700 Starbucks locations worldwide, with at least three more opening in the time it takes you to read this sentence. The dominant local brand is CC’s Community Coffee House, with more than 30 locations statewide, including a dozen in Baton Rouge. But while Starbucks and the other java chains put a lot of competitive pressure on the mom-and-pop operations, many independent coffee shops are surviving—and thriving.

While Starbucks represents more than one-third of the roughly 25,000 coffee spots in America, about half are independently owned, according to the Specialty Coffee Association of America. The chain’s explosive growth in the 1990s coincided with a larger consumer movement toward premium coffee. For most of the decade, the number of coffeehouses was doubling every two years, says Mike Ferguson, a SCAA spokesman, and it’s debatable whether Starbucks was leading the trend or just riding the wave.

One industry theory suggests Starbucks actually helps the independents by promoting the concept of quality coffee to a wide audience. People who were once content with Folgers start hitting Starbucks for a daily Frappuccino, until they notice the cheaper, less-crowded and oft-better independent next door. Taylor Clark, author of Starbucked: A Double Tall Tale of Caffeine, Commerce, and Culture, writes that while Starbucks frequently locates next to mom-and-pop stores in an effort to run them out of business, the coffee giant often fails to do so. But you can’t generalize and say the coffee chains, with their superior resources, are necessarily good for the little guys.

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“There are some neighborhoods where they have clearly made it tough on the independents, and some neighborhoods where everybody’s thriving,” Ferguson says.

But there’s no question the coffee boom of the 1990s has leveled off. It’s no longer enough to have a passion for coffee or a measure of business savvy to run a successful coffee shop, he says. In today’s competitive environment, you need both.

“It’s been a long time since you could open your doors with an espresso machine and a few card tables and have a coffeehouse,” Ferguson says. “Those days are long gone.”

Every successful indie coffee shop has its own story. Ferguson described one veteran shop owner in Long Beach, Calif., who responded to a new Starbucks nearby by stepping up his own business practices. He became a better marketer and a better trainer of his staff, and his sales went up 40%.

Independents can be flexible without having to run every decision past a corporate office. Menu variations or a unique house blend can help them stand out. If there are a lot of telecommuters in the neighborhood, you might want to keep the music down and make sure you’ve got plenty of electrical outlets for laptops and small tables so folks can sit alone and work. If you’re in the city’s arts district, that might be a very different kind of place. But here are some regional chains that are pretty good at localizing their stores, Ferguson says.

Gabby Loubiere, owner of Brew Ha-Ha! on Jefferson Highway near the end of Mid City’s Government Street art and design corridor, doesn’t like to bash Starbucks. In fact, she’ll hit their drive-thru when it’s convenient, and will stop at CC’s if she’s in the mall. But she says chain coffee shops offer a somewhat bland experience.

Her café, on the other hand, features live music and displays by local artists. If there’s a trend somewhere, like bubble tea in California, she might try it out for a few months, and she mixes up the menu with different specialty desserts. She says the atmosphere is a little like a bar—but without the booze.

“People ask me all the time, ‘How do you compete with the CC’s and the Starbucks?’” Loubiere says. “I don’t compete with them at all. Yes, we have coffee, and that’s the one thing we have in common. But aside from that, the whole vibe of the place is totally different.”

Clarke Cadzow, owner of Highland Coffees near the North Gates of LSU, says independent shops have to strive to be as consistent and efficient as the chains, while finding ways to differentiate themselves by building relationships, offering hard-to-find products and providing better service. Independents are more likely to have an owner present, which may lend them credibility and provide a higher level of expertise. Selecting and brewing good coffees and teas is more of an art than you might realize; in February, Starbucks closed every store for three hours in order to retrain employees on the “art of espresso” and improve what CEO Howard Schultz calls the “Starbucks Experience.”

Big coffee chains have superior marketing muscle and deeper pockets that allow their stores to ride out the rough patches when an independent shop might have to close; in that sense, the coffee game is like any other business. Ultimately, independent stores depend on local residents to appreciate what they have to offer and seek them out.

“Chains homogenize communities, and they can crowd independent shops out of the market,” Cadzow says. “In small- to medium-sized cities, there is only so much business to go around.”


Comments

Posted by gloubiere on July 19, 2008 at 4:23 p.m. (Suggest removal)

Thanks to a poll on the daily report Friday...we see your opinion is just that "yours". I'm quite disappointed that such a credible magazine as the Business Report would grade local coffee establishments based on one guys opinion. Even if you are an ex-barista! It's just YOUR OPINION! I think it's offensive to all of us you wrote about. I've gone to coffee call since I was a child & love the entire experience. You gave THEM a D too! That's just ridiculous. The article itself was pretty well written, you should have just left off your "grades". It was tacky! I admire & support all of the hard work that goes into running our local Starbucks, CC's, Perk's, Highland Coffees, The Buzz, Coffee Call, & my own Brew Ha-Ha!

Shame on you,
Gabby

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