Cafe Business
Popular
small business towns in our area.
How far should big business go
to run your community, and how much are your local politicians
willing to accept from big business. These are the key questions of
the day as big business wants you to pay for their success. An
historical event is about to happen in the Specialty Coffee
Association. The SCAA will
hold a forum about this issue.
What happens when big business
and small business collide ? Accept a chain store in your
community and chances are the taxes it generates will be returned to
it as profits, for use to put local stores out of business and leave
important civil services to be funded by the coin toss at the
roadside gutters. But you hold the key. Hence the term Starbucks
encroachment, but that's an unfair label. All major corporations
want to make company stores in the community. Taking away the
intimacy of the small town. Customers are not onlookers. Customers
make it happen or not.
One of our major sales areas is the supply of
small business start
ups with beginners coffee and tea. As the owners grow in knowledge so
will their customers. We feel strange sometimes when we begin with a new
customer on these terms, because its exactly the opposite of where we
began. Our start was as a hobby, at least roasting coffee. We had
already worked in the food industry, went to cook school, and filled
positions as executive chef. Then had worked in Virginia and California.
Later to leave for professional educations in another field. But this is
traditional all the way throughout the specialty coffee industry from bankers, lawyers,
chiefs, politicians to the cafe business.
Michael Shulman points out our
community gives away its freedom turning over billions to major
corporate entities. Land of the free home of the brave. No
where in the civilized world has been ruled by corporate enterprise such
as the US. No
where in the corporate world have citizens given that power to corporate
America by their purchasing power. In 2008 there will be more
independent coffee roasters in America and more independent tea
importers and entrepreneurs than any other time. Making this possible in
part is an unbelievable contradiction...the man and policies of
President Bush. More sophisticated marketing and planning experience on
your part can only help your business. To take advantage of this climate
you need to know how to acquire and perhaps import bean & leaf.
If you want to try it we have some tips taken from our
experience. Read the other human contradiction of
our time Ms. Martha Stewart in which she will say much of what's in this
paragraph. She turns out not to be not so rigid, prim, proper, you know
uptight. Find other people to help you do it. Don't buy anything new
until you've mastered the mechanics of used equipment taking it apart
repairing it and making your espresso machine off the junk pile. So
that's it. We took a burned out roaster and rebuilt it turning it into a
wonderful machine just for an exercise. Our antiques were reconstructed
and replenished and sold only to regret it later. Simpler is better.
Older is always simpler and more powerful. Just like car mechanics you
can learn the machines and how they work. Currently we are amazed some
of our machines work at all. Do not buy new
equipment initially. Do not enter into leases with coffee or tea
businesses that will cut into your profits. Design your own brand, stand
on your own feet, develop your own taste profiles. Be different. Don't
be afraid.
Listen to this story, "When I interviewed a local business
woman a chef by trade she said a coffee salesman visited before she
opened. She then realized either the town or the health department had
tipped him off. His sole pitch was a free Bunn coffee maker, if only she
would use their company coffee. No roast dates were on his products.
When she asked what his credentials were and what custom roasts he'd
marketed and tried he just said. "Do you know everyone in town uses my
coffee?" She kicked him out.
In the location of our town Avon By
The Sea, New Jersey almost every business on Main Street is under
contract from T.M. Ward Coffee Company. They have a true monopoly. In
New Jersey, Lacas Coffee Company is just beginning to challenge these
type of corporate situations. Though a corporate giant too they may be
successful in opening and integrating new markets. This has the slight possibility of
creating flavor & business diversity which ultimately rewards citizens and
restaurants.
No surprises here, the company store
returns from the miners town to your community. Tax increment finance
agreements take your money and instead of returning it to the town goes
instead to the company. It's no secret that one of the lessons from Seattle was
that good competition led to unpredicted wealth for Seattle. Let the
battle begin! Our suggestion is stay away from the fray and choose a
small artisan coffee company. Stay away from equipment leases. Watch the
development of these markets and diversity when considering a location
for a gourmet store. A gap in food services may be created. Which you
might develop into a theme for your store. But be careful, these large
corporate entities aren't just interested in supplying the local
restaurants on main street USA; they want to put your cafe out of
business, especially if you sell beans & leaf.
A start up small business should never
buy new equipment. For less than $10,000 you can invest in used equipment
rebuild it and sell it. Then start all over making and adding new
components. Some of the best cafe's have made their own brewers and
devised or morphed their own roasters. One owner roasted coffee by the
1/4 lb and sold it by the 1/4 lb then made drinks from it. As demand
picks up you can enlarge, but to buy large at $80,000 + before demand is
too risky. Maybe people will hate your offerings, maybe even hate you,
or hate everyone and can't support your business. Spare yourself. These
are the business essentials. For further information contact us or order
from us.
Cafe Business
That being said the political nature of what you do
should be examined and the social forces in your community. Try finding
this information on the internet. All search engines have practically
eliminated one of the cafe's most important function. To be a rally
point for questions and new ides. Beware of the lack of information on
search engines between cafe's and political conversation. Cafe politics
can be found during a search on the Library of Congress search engines,
but have been eliminated when the internet expanded.
Case study where the small town
revolted. Politics. The real story goes something like this. A large business
moved themselves to a town of four thousand people. The business made a
deal with local political figures so that the company would move in but
only if they could obtain a tax increment finance agreement. The deal
was set and the rest is history. You should know that tax increment
finance agreements in this case led the 4,000 people of the town to pay
the company more than 30 million dollars. TIFA or TINA is an agreement
between the business and the local politicians that collects state
sales tax from customers and returns it to the company. They mined 30
million dollars from the community. During this time the police, fire,
schools have to raise more taxes because they're not receiving the sales
tax. What was the cost to individuals in that community? Each person
could have received 8,000 each and free gas for a year at today's
prices. They could have had world class education upgrades for their
children, better police services, and the best fire department and first
aid. Don't believe that the cafe business success is about location,
location, location. Its about politics, politics, politics.
Reviews about Coffees and Teas of Yesteryear,
Other cafes,
Big business Small Business. When the big giant corporations like
TM Ward and Lacas Coffee take over and monopolize a town's coffee
offerings there can be several psychological reactions. As bean and
equipment suppliers what they sell is coffee by the pound usually around
$4.50 lb. Minimums can be as low as 12 lbs. It doesn't take an
accountant to realize adding the equipment lease locks you in. Then they
want to outfit you and lease a steam table etc. Now here's the potential
problem. All of that money leaves the town.
Cost of doing business. What's your loss. So the business that
carries their coffee soon learns they pay sales
tax and that goes to the town. What of the community group donations,
free giveaways to the local civic groups, etc. That money goes out. Are
you calculating? Then you're going to allow them to put a sign in your
window? TM Ward supplies me. We suggest this sign. "What. "Look at me I fell for it."
When you take everything into
consideration. Calculate the lease, calculate the sales tax, calculate
cost of cups, lids, napkins, sugar, and donations. Exactly how much is
going out? More than a $1.90 for a cup of coffee. Make sure if you're
going to play this high stakes game you know how to play it, and play it
well. Tip; when you sign a lease at least have the guts to tell the
company you want the town to benefit in some way. They should
donate to that school program, to the fireman's ball or PAL. Heck, they
should buy the first aide an ambulance! For each town they monopolize is
the basis for the next town's sales pitch throughout your state. And
there's poor you. Some contrast.
You can buy your own percolator and vacuum
pot and your coffee or tea locally and no one's going to tell you what
to brew in it. Calculate the amount that directly returns to you and
your community.
Political support. Let's say, you just built a world
class cafe and a major chain moves in. The chain may use its TFA or TINA
option with the intent of closing you down ! As a result there's no even
playing field. You'll work harder but the lead the chain has over you is
astronomical. In most cases local businesses and individuals don't know its happening.
Take this to the internet and you'll see clearly that Google and other
search engines are taking money from TINA businesses who want to
advertise while the small businesses can't find an even playing field.
The even playing field would be not to accept the degree of advertising
dollars from TINA stores. Research this further in two important books.
First, Free Lunch, by David Cay Johnson and
The Small
Mart Revolution by
Michael H. Shuman.
Mr.
Michael H. Shuman on local communities will be the main speaker to the
Specialty Coffee Association
conference in 2008.

a
store like ours and begin to order. You might find you
need a few moments to orient yourself. After all this is not a cafe
you see everywhere. That's it exactly, you can't find the staff that
won't talk, making drinks from origins they don't know about, and
have hardly traveled walking the streets of an unknown to tourists
side of town. With this knowledge we make a different kind of
product and we were to some degree made into different kinds of
people. People associated with our store will probably never darken
the halls of a chain store. Except for the use of their bathrooms.
Or taking up space to get to the business next door. Arrogance can
be appropriate when you have a history of positive performance, and
we have that history of romancing the bean and tea leaf.
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