Wrestling with Starbucks: Conscience, Capital, Cappuccino

Chapter 6: The Cross- Dressing of Coffee-Counter Culture

123 The CrossDressing of Coffee-Counter Culture 6 There’s often a flurry of opinions, pro and con, about the potential impact of an urban Starbucks on its neighborhood. But there are also people—surprisingly many of them—whose passions extend beyond a single store to the very idea of Starbucks and all its earthly manifestations. Who would have thought that a glorified coffee shop could cause such a stir? Starbucks believes it has reinvented coffeehouse culture by providing an affordable luxury for the discerning masses while being a good citizen in the community and the world. According to its opponents, however, Starbucks has colonized and irreducibly branded coffeehouse culture as its own. These views, each arguably half-right and half-wrong, compete on websites such as http://starbucksgossip .typepad.com/ and www.Ihatestarbucks.com, in the strong language of love and hate, virtue and vice. They also coexist in our common economic and cultural imagination: the warm and fuzzy small enterprise, a nostalgic throwback to a better time, versus the large and predatory corporate venture that’s simultaneously essential and menacing. But there’s one giant problem with the progressive coffee house analysis. Despite the Starbucks onslaught, independent coffeehouses are not only surviving but proliferating. Statistics indicate that, compared with the pre-Starbucks era, small coffeehouses are more numerous today and exist in many more geographically diverse locales. According to Mintel, a market research firm in Chicago, there were 9,500 coffeehouses in 1998, fewer than 2,000 of them Starbucks. By 2005, however, there were 13,849 non-Starbucks coffeehouses, plus 7,551 Starbucks. Despite an increase in Starbucks’ market share, independent cafés showed increased sales right alongside the Starbucks expansion. But to survive, independents have needed to be at the top of their game. They require a devoted local following, great coffee, good management, a decent location, knowledgeable counter staff, and an endearing counterculture—or at least a reasonable mix of some of these characteristics. Sandwiched between two universities in Pittsburgh’s Oakland neighborhood, the Kiva Han coffeehouse and Starbucks glare at each other across Craig Street like two boxers in opposite corners of the ring. John Mutchka bought the Kiva Han café in 2002, when it was eight years old, taking over from the first owner, who still maintains a roastery of the same name and supplies the café with its beans. When Mutchka became the managing owner, Kiva Han was a typically eccentric and somewhat grungy independent, although, he says, its inception owed as much to the success of early Starbucks as to counterculture coffeehouses. Mutchka actually trained at a Starbucks in a Barnes & Noble to see whether he liked the work. “I learned how to make drinks and about customer expectations,” he said. “They gave good in-house training, and I had a great manager.” One reason for America’s interest in coffee entrepreneurship is that coffeehouses are fairly inexpensive to open. According to Badgett’s Coffee Journal, an industry newsletter, in 2003 it cost between 15,000 and 20,000 dollars to open a coffee cart, 50,000 to 60,000 dollars for a permanent kiosk, and 120,000 dollars for a sitdown coffeehouse. For a small business, that’s a modest sum. But opening a business is one thing; staying in business is another. Small Business Administration figures show that new small businesses face big survival odds; two-thirds are still around after two years, but only 44 percent survive for four years. Still, thanks to Starbucks, an increasing number of people are placing their hopes on a coffee future. In 1994, the year the Craig Street Kiva Han opened, David Heilbrunn cautiously debuted his first Coffee Fest, a trade show for independent coffeehouse owners and aspirants, with classes in all aspects of the business and an exhibition hall brimming with coffee-related merchandise. These days, the show, held several times a year in the United States and expanding into other 124 W R E S T L I N G W I T H S TA R B U C K S countries, regularly draws 3,000 participants. “People saw it as the get-rich scheme of the 1990s,” said Heilbrunn. “They saw Starbucks and felt they could open up a coffee shop and be successful.” John Mutchka, however, also had an alternative economic vision. The son of a university janitor in a small coal-mining town, he trained...