Coffee and COVID: Local roasters trying to stir interest, stay afloat during new era of doing business
RENO, Nev. — The smell of hot coffee and intermittent hiss of espresso machines fill the outside air. Roughly two-dozen people, seated at tables scattered on a patio, are sipping coffees and lattes.
It’s a sun-splashed Friday morning in mid-June, and Hub Coffee Roasters on Riverside Drive is buzzing. In fact, at first glance, one might assume business is back in full swing for the Hub after being hit by the coronavirus pandemic.
Peer closer, however, and it’s clear that while its patio is brimming with patrons, the 3,000-square-feet of seating space inside the specialty coffee shop is completely empty.
“The perception of what you see as far as a customer base can be deceiving,” Mark Trujillo, owner of Hub Coffee Roasters, says with a smile. “But this is about net now. Gross is great — volume is great — but how we are running our business inside makes a big difference.”
After the state shut down and coffee shops, restaurants and others had to rely on curbside sales, Trujillo said the Hub’s revenue was down 60% compared to last year. Months later, with a 50% capacity allowed during Phase 2 of the state’s reopening plan, the Hub’s sales have largely remain unchanged, he said.
“It’s pretty much the same business. It’s not like after stage one we went up like this,” said Trujillo, raising his left palm in the air. “Right now, we’re about 50% down from last year.”
‘WHAT DO WE DO?’
The Hub is not alone. Coffeebar in Reno’s midtown is down 65% compared to last year, said owner Greg Buchheister.
The Coffeebar founder said May is typically the strongest month for his Reno shop. That’s not the case this year, especially since the establishment could not reopen its dine-in seating until Phase 2 kicked in at the end of May.
For Buchheister, the sharp drop in business due to COVID has been hard to wrap his head around. He opened his first shop in Truckee nearly a decade ago before expanding to Reno, among other cities in California.
“We’re doing less sales than we did the very first week we were open for business,” said Buchheister, who opened Coffeebar in Reno in 2014. “You’re like, whoa! Total reset. And then you have to build back up … and that’s just not easy.
“And we’ve been in growth mode for so long and planning on opening up two other locations that we were already pre-funding. So, a lot of our cash flow was going to that. So this hit and we were like, oh my god, what do we do?”
Quite simply, roasters like Coffeebar and Hub Coffee have been forced to get creative to stir interest and stay afloat.
Buchheister says Coffeebar started doing deliveries within five square miles of each of his stores and taking takeout orders via text. What’s more, the company is in the process of launching a new user-friendly online ordering system, which will include a five-minute menu to help appease social distancing inside.
“Everything on that thing is five minutes or less and we just bang it out,” he said. “That way people on their way to work don’t have to get additional exposure.
“I feel like all we’ve been doing is innovating. You get the new rules and throw some spaghetti at the wall and see what sticks and go from there.”
Hub Coffee Roasters, meanwhile, has added new products to help soften the blow of COVID’s impact.
In April, the Hub rolled out a canned cold brew, and a month later, introduced its instant coffee. Moreover, the coffee roaster launched a free app for mobile pick-up ordering.
Trujillo says online sales overall have jumped 300% during the pandemic.
“The positives is our online sales, and we really didn’t have to spend much money and thought to get our online sales going,” he said. “That’s the future — I think there’s this online presence that’s going to help businesses be more creative and keep their margins and make money.”
With that in mind, Trujillo thinks coffee shops won’t be so “laptop reliant” moving forward.
The days of students, remote workers and others planting with their laptops for the day are long gone, he said, especially now that so many have grown accustomed to working from home.
Notably, since Trujillo’s interview with the NNBW, the Hub’s Riverside location opened its inside seating to customers.
“I think people are realizing they can work from home and just need a break to come to a coffee place, but not make it their office,” he added.
Buchheister agreed. For his long-term outlook, he expects to see a smaller crowd at his 2,300-square-foot shop in Midtown — at least until there’s a COVID-19 vaccine available to everyone.
Prior to the pandemic, he said the in-house to takeout ratio was 60% to 40%. He expects that to flip and then some.
“To be honest, and this is fairly pessimistic, I think it’s going to take 18 months to two years before we get back to where we were,” he admits. “I don’t know if it will ever be the same from a dine-in experience.”
Jacob Warwick, CEO of Discover Podium, says the company that launched only a year ago in Reno recently surpassed $1 million in revenue and has big plans for growth in the coming months.