Seattle Coffee Works

Our good friend and local Coffee Hero, Michael Smith, writes that he’s taken up home roasting because of the rising prices of Espresso blends from Seattle roasters.

The view from beach house number five on my privately owned island in the Carribean.

Even though Michael doesn’t mention names in his post, he could be referring to us when he writes that “one Seattle roaster [which] saw my May 2009 Espresso price list…raised his whole bean price 50 cents a pound, because he was priced lower.”

Michael goes on: “There are two ways to put more cash in the register.  You either increase your customer base through competition and marketing or you squeeze the customers you already have a little bit more.”

He’s right. Seattle’s roasters are overcharging their customers. We’re gouging, we’re greedy, we’ll suck any of those sacred green bills from the living. (In fact, I’ve already applied for a job at a big, sleezy investment bank — I hear they’re always looking for my type.)

While I can’t speak for other roasters, Michael’s conclusion is certainly not true for Seattle Coffee Works.

Before I go on let me state that, yes, we did increase the price of our Seattle Space Espresso Blend by 50 cents to $13.45 per pound (that’s a whopping 3.861%), and, yes, we reduced the price of our Swiss-Water Process Fair-Trade Organic Decaffeinated blend, which we call Our Best Decaf. We also adjusted (up and down) many of our single-origin coffees to better reflect the different cost bases for the different coffees we source. This had nothing to do with Michael’s price list but was a long planned adjustment in our pricing structure. On average, our coffees are probably now cheaper than before.

Michael writes the price of coffee should generally decrease because of coffee futures, oil, commercial real-estate, and because almost everything else in this economy that costs money has gone gotten cheaper.

His observation sounds true at first; yet if you look little more closely you’ll find that price development in a specific industry often has very little to do with price development in the overall economy. Case in point: While many goods and services have gone down in price, some have gone up.  

For instance, softwood lumber has seen a price increase of 6.7% year over year – despite a prolonged decrease in building activity. Pure conjecture doesn’t help explain price increases or decreases; it all depends on the specific economic activity.

The reason we had to increase the price for our signature Espresso blend is very simple: we use a large percentage of coffee from East Africa in this blend, and simply put that coffee has gotten 20-30% more expensive during this past year. Our modest price increase doesn’t go very far to cover that increase.

And our costs also don’t adequately reflect any of the services a roaster provides, namely the work involved in sourcing really high quality beans, the storage—both the quality of storage as well as the space—packaging, the continuing sourcing of new-crop coffee… the list goes on. If our prices were so high as to actually make us some serious money, you would likely find us lounging on the beach rather than in downtown Seattle.

Other than some of the big chains no one has gotten independently wealthy in our industry. The adage: Start with a big fortune to make a small fortune, certainly holds true for most of us in specialty coffee.

There are exceptions. Check out the coffee aisle in any large supermarket. Despite the comparatively low overhead and the less-than super premium coffees on offering, you’ll be hard-pressed to find coffee that’s cheaper than what your local roasters charge. (Trader Joe’s and Costco are an anomaly, and this would warrant another post.) That would explain the nice earnings at some of the large coffee companies. I know that some especially savyy folks have indeed retired to some beach in Central America.

But here’s the deal, Michael. In addition to roasted, we’ll also sell you green coffee for your home roasting. It’s cheap. It’s straight from our roastery with the added services (minus the actual roasting) provided by the roaster.  And by the way, if you order online with the code: STORE, we’ll package your coffee, ready to go for you to pick up in the café, with no additional shipping costs.

So check out some of the new, outstanding coffees we’ve recently received: Sulawesi Toraja Sapan Minanga; Sidamo Moredocofe; Tanzania Blackburn Estate; El Salvador Capitales Unidos; Honduras Las Capucas. We look forward to seeing you back for your green (or roasted) beans sometime soon! Or, just for a chat over an expertly pulled double espresso ($1.82 + tax.)

Picture credit/source:  http://www.flickr.com/people/18220192@N04/ / http://www.flickr.com/photos/18220192@N04/2053190004/

We get asked about Starbucks all the time. Questions range from “Where is the ‘Original Starbucks?’” to “Can I please have a ‘Caramel Macchiato’?” We can only answer the questions as they are posed and to the best of our knowledge.

The other day when I was chatting with Melissa Allison of the Seattle Times, she told me that I talked about Starbucks a lot more often than most other folks in Seattle’s independent-coffee scene.

The truth is, here at Seattle Coffee Works we do talk about Starbucks a lot. Not only do our customers ask us how we’re doing amid the 99+ Starbucks within three blocks of our store but we also actively study our big corporate neighbor. We often buy coffee from our neighboring stores and check out their operations. We figure there’s a lot we can learn from Starbucks (as well as other cafes and roasters).

In today’s Seattle Times article, I mentioned Starbucks’ somewhat unnerving visits to our tiny hole-in-the-wall café. Here’s the story: last winter, three separate delegations of Starbucks folks came by. Each time they filled our little store so that no one else could fit in. Usually they didn’t introduce themselves, and one delegation even lied, saying they were just a group of Japanese tourists. They didn’t buy a single drink. When we offered to make them an espresso for free, they didn’t care for it. That was really strange, for a company that says they like coffee. Plenty of other roasters, café owners and baristas stop by our store all the time for coffee. We love exchanging ideas, opinions, samples, techniques.

That’s what makes us Seattle Coffee WORKS, emphasis on the WORKS. Coffee is a work in progress, and we’re an experience coffee project, a place to explore, communicate, share our passion and fascination for coffee. Even a lot of Starbucks baristas come by. After all, many of them are curious about coffee too. Coffee is a deep subject, with so much to learn. (Did you know it’s the world’s second most traded commodity, after oil?) Starbucks corporate reps checking out the café décor but not the coffee? Go figure.

That misdirected interest among Starbucks higher-ups is one of the reasons why Starbucks will have a hard time creating a “neighborhood” store as reported in The Times.

Here are some other principal differences between a Starbucks store and an independent coffee roaster like us:

• We’re not profitable and we never expect to be profitable. If our little coffee business can pay a living wage to everyone working here, including the folks who own and operate it, we’ll call it a success. Starbucks has to pay the baristas, the store managers, a regional manager, all the way up to the COO & CEO and a bunch of creative types doing all kinds of corporate rethinking. I do believe small businesses have the opportunity to provide better value for this reason alone. (Weighing the economies of scale versus passionate investing and re-investing into a product and an experience you love would warrant another blog post.)
• We have a much easier time connecting personally and directly with our customers. No one’s speech is scripted or otherwise limited by corporate speak.
• Our interior design is conceived by real people for real people; we’re not pursuing a hidden agenda of pushing more product or cutting down on our customers’ “dwell time.”
• We love coffee, and (did I say that already?) we always want to learn more about coffee, even when that means buying a cup of it from one of our competitors.

We study and admire Starbucks for some things we have a harder time getting right:

• Speed of service; few companies have spent as many resources on figuring out the best and most speed-inducing bar setup
• Merchandising and labeling; Starbucks design is often really well done and it’s made to sell
• Location location location; man, all of us indies would die to know the SBUX formula for choosing a successful location.

At the end, all of us Seattle coffee creators know that things would have been very different without Starbucks here. It created a market of people who appreciate making coffee a part of their daily routine and cafes a desirable destination. Face it, Starbucks stores are almost a neighborhood fixture, like public libraries, schools or community centers. Without Starbucks, there would be far fewer coffee places here, and we would probably sell a lot more drip coffee rather than the lucrative tall latte. Without Starbucks, Melissa Allison would probably have to write about airplanes or Microsoft Windows, and I’d be working deep in the belly of a well-known Internet retailer. So thank you Starbucks. You’ve liberated me.

Photo Credit: http://www.flickr.com/photos/chrisdag/, the original resides here: http://www.flickr.com/photos/chrisdag/3398960788/

Tuesday, July 14 marked the birthday of our new Coffee Drinking Man. The 14+ foot sign arrived early morning, ready to be hoisted into his new position atop our cafe and roastery.

The other day some of the Seattle Coffee Works team visited Essential Baking, our pastry and bread supplier. Other than the good time that was had by all, we were impressed with the vision and the execution at Essential.

Just like us, Essential is working hard to make a difference in the world. Essential’s basic principles revolve around: 1. Unwavering customer service; 2. Relentless pursuit of quality; 3. Minimizing the environmental impact; 4. Respect for all stakeholders.

I may be mixing up our experience with the company’s stated vision. Let it be said though that all of us coffee people came away deeply impressed after seeing the operations behind the flawless service we receive, 362 days a year.

We found some things especially impressive. Essential operates around the clock. Most baking takes place at night, 24 trucks deliver the goods in the wee hours of the morning. So many things can go wrong: a driver might not show up, a vehicle might break down, an oven might need maintenance, a flour delivery might not have happened, and the list goes on and on. Of course large industrial operations face these kinds of challenges all the time; but for a relatively small business like Essential to deal with and successfully overcome all of these potential issues is truly impressive.

Photo: At the end of our tour, we posed with Essential’s founder and head baker George DePasquale (far right.)
Photo Credit: Polina Notik, our indefatiguable summer intern, who loves using the self timer on her new camera (Polina jumped into the picture next to George.)

Time flies! We moved a month ago and have barely had a moment to breathe. It’s probably in keeping with our small-n-real business character that we moved before we had all i’s dotted and all t’s crossed.

A reviewer on yelp liked what we’re doing a lot, but knocked us down a star because our slow bar wasn’t quite there yet when she stopped in. Now it is.

We’ve continued to have to roast off-site at Velton’s as the permits for the roaster took a little while to snake themselves through the various agencies. Thanks to all of our inspectors and reviewers we may have managed to get a coffee roaster through the process from permit submittal to approval faster than anyone before us, at least here in Seattle. (And you’d think it would be easy to start a roastery in the Coffee Capital of the World!)

A couple of weeks ago, vinyl decals went up on our windows so folks knew what we sell.

And, finally we’re about to welcome the last member of the team: Drinking Man. We received a sneak preview from the shop. Stay tuned for the dude!

Oh, how we’ll miss that 111 Pike Street address that gave name to our first espresso blend: 111 Pike Street Blend! Earlier today we made the move out of the t-shirt shop into our own lil’ café.

Everyone here at Seattle Coffee Works is tired and very happy. Tomorrow morning we’ll be making coffee in our new 107 Pike Street location. The roaster is here and almost ready for action.

During the last few days, Katie took some pictures and I took a picture of Katie– check out:

Katie cut the ribbon as the new Diedrich IR-12 arrived

We wanted to see, once and for all, how many people could fit between counter and “grinder hutch” in the old 111 Pike location - almost the entire team fit. From left to right: Erik, Vicki, Elie, Amir, Pipo, moi, Ryan, Brooke, Daryl, Patrick, Katie, and Juan. Not pictured here: Max and Eric.

Katie took this shot of one of the many Home Depot shopping lists we created and filled during the last few days. 

Today there is only space and time for a HUGE THANK YOU to everyone who helped us make our dream reality; you know who you are. Soon, we’ll have the real-deal VIP party followed by a very grand Grand Opening.

Construction in our new cafe is humming right along. It’s amazing how much a fresh coat of paint and a good scrubbing can change the face and feel of an interior space. Our construction crew has been working around the clock to clean the old restaurant space into our new cafe– from painting the walls in our warm and inviting colors to varnishing our new countertops with a rich brown coat to polishing our sleek new concrete floor.

Thank you to all Seattle Coffee Works friends who’ve helped in demolition, construction and soon, cleanup! We’ll open as soon as possible in June and can’t wait to show everyone our new digs!

Keep your ears to the ground and your palates whetted for tasty coffee… the new Seattle Coffee Works is coming soon!

Yup. You heard right. It’s now only $5 to ship coffee from the Seattle Coffee Works roastery to your home.

For ages we’ve been shipping coffee via United States Postal Service. So far they’ve treated us and our coffee customers well. Our packages arrive reliably within two to three days all across the U.S., each complete with a tracking number to monitor the coffee on its journey. But shipping prices have increased again and we’ve heard murmurings through the grapevine that it’s just getting too expensive to mail coffee.

So we switched to a model of flat rate shipping. Instead of dancing around price fluctuations based on weight of package to the various shipping zones, we’re now charging only $5 to ship our delicious coffee! One price. $5. So whether you’re sending one bag to your sister in Dillingham, Alaska or twelve bags your cousin in Toledo, Ohio, it’s the same price. That way you worry less about shipping costs and more about which tasty coffees you want to enjoy!

Just know that you’ve saved a little money each time you find that Happy Coffee package on your front doorstep!

Woohoo! Let’s drink some coffee!

We’ve seen some truly amazing people walk through the doors of the Seattle Coffee Works café. From architects to students, city planners to night-shifters, we’ve met them all. The quality of character never ceases to amaze us.

This year, one of our ambitious and loving customers is planning to amaze us again since she began training for her second half-marathon. Adrienne Anderson will be competing in the BMO Vancouver Marathon this May in honor of her mother who died of Hodgkins Lymphoma in 2006. Her goal is to raise $3,000 for the Leukemia and Lymphoma Society.

Adrienne asked us to help her meet her goal this year. So to show our support we created the Northwest Runners Blend, pledging to donate 15% of each purchase to her cause.

We’re inspired by Adrienne’s perseverance and hope she can inspire you, too. So while she’s pounding pavement to find a cure for Leukemia and Lymphoma, you can support her efforts with us at Seattle Coffee Works.

You can also read more about Adrienne’s training adventures here.

A while back we repriced everything in our store so that *after* tax all prices ended in quarter increments: x.00/x.25/x.50/x.75. The new pricing structure has worked very well. We have been able to increase our speed of service without giving up one bit of quality. The bean-counter guy also noted that our daily cash reconciliation has become almost error-free because of this small change. 

We also got rid of another nuisance: we don’t EVER need any more rolled pennies, nickels, or dimes from the bank. We thought we’d found the solution to all change-bank issues. Alas, the ordeal wasn’t over.

While we weren’t returning any coins other than quarters to our customers, our customers gave us all their change — maybe a by-product of their general economic woes. Nowadays we seem to see at least one customer a day who pays for her entire coffee with coins. Because we have no outlet for the small change, time and again we find our till overflowing with … pennies. We’re talking hundreds of pennies. Counting pennies at the day’s closing went from being a small chore to a major time sink.

From my days in the field of industrial supplies I remembered that the folks in the warehouse never counted all those little screws, nails, grommets, and sprockets. It was much faster to weigh them. Yesterday, our own little weight-to-count-conversion spreadsheet went live. The counting of coins which used to take 300+ seconds every night has become a weighing of coins. Time used to weigh / count 1,500 coins: 54 seconds. Yahoo! 

Next we need to find a funnel to put all those loose pennies into little paper rolls; and off they go to the bank.

Photo Credit: Frog Museum