Thursday, October 09, 2008

Consumers are ordering regular coffee and are increasingly purchasing coffee beans

The $4 latte may have been a symbol of the booming economy this decade, but Joe Six-pack is drinking a regular cuppa joe more often these days at local coffee shops.

Financial trouble is brewing throughout the coffee world. Starbucks is making headlines because it is slashing workers' hours to bring down labor costs and closing dozens of underperforming U.S. stores.

So goes the economy, so goes coffee, to paraphrase an old expression.

And apparently the global credit crisis has begun to hit many Greater Cincinnatians where it hurts ... right in the old coffee cup.

"I've seen a definite decline in espresso-based drink sales since the stock market collapsed on Sept. 15," said Pat Wynne, owner of the Coffee Shop on Madison in O'Bryonville. "People are still drinking coffee, but they are going for the less-expensive 'regular' kind."


Wynne's café sells a large cup of plain coffee for $2 compared with $3.85 for a large nonflavored latté (espresso and steamed milk).

Wynne went over his cash register receipts and found that in the last 15 days of August, his store sold 298 medium cups of plain coffee. During the last 15 days of September, the store sold 407.

"Those days in August are what I consider our last 'normal' two weeks," he said. "That is because it was before the windstorm (on Sept. 14) and the stock market calamity on Sept. 15."

He doesn't factor in the first half of September, believing that the windstorm may have artificially inflated his numbers. The Coffee Shop on Madison was one of the few businesses left open in the area that offered coffee.

"After that power outage, we had the four best days of our business,'' he said. "But then we continued to increase.''

Erec Reichardt, co-owner (with Greg Zmich) of Lookout Joe, said that they are selling the same number of espresso-based drinks in Mount Lookout, but are seeing a small decrease at their downtown location in the lobby of the Federated Building at 15 W. Seventh St.

"Our downtown customers are more price conscious," he said. "The average income is not quite as high as in Mount Lookout, so it has always been more of a straight coffee crowd. It's also determined by the flow of business there. People need to get that cup of coffee quickly and get to their desk. Since we make coffee self-serve, it is easier to get than to wait for a latte or other higher-effort drink."

The firm has seen whole-bean sales go up, too.

"People realize that they can buy a bag of fresh roasted beans for 10 or 11 dollars a pound, take it home and make eight or nine pots,'' Reichardt said. "That way they are still getting good quality coffee at a good price.

"Personally, I think that high-quality coffee is one of those affordable luxuries that people don't want to give up,'' he said. "I can't promise that it will stay this way; but at this time, coffee has been able to entrench itself and compete against" the weak economy.

Case Kuiper, owner of Mammoth Café in Newport, said his core customer group is "more concerned with having their coffee than what the stock market is doing" and still comes in an average of six days a week.

But the continued barrage of economic bad news has resulted in a 10 to 15 percent drop in business in recent weeks.

"None of my core, but 50 percent of the (other) customers who walk through this door ... are spending less or not coming in as frequently,'' Kuiper said.

Mary Jo Morgan, owner of Coffee Please in Madeira, said sales of coffee drinks, both regular and blended, have remained the same in past months.

"People who like the drinks order the drinks," she said, citing location as a factor. "This is an upper-middle-class area. We haven't been hit by the effects of the weak economy, and I don't expect it to happen.

"People realize they need that cup of java first thing in the morning, and thank God for that!"

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