Taking Baby Business Steps Can Get You Further in the Long Run

Published in UT San Diego, May 19, 2014

Gimme a double mocha latte, nonfat espresso Frappuccino Macchiato and put them in 16-ounce cups to travel.

The coffee business is addictive but Elke Patton and her husband, Chuck, did not know that when she gave him a small coffee roaster for Elke Chuck carhis birthday in February 2001.

Chuck liked drinking good coffee after living in San Francisco, where the couple had the opportunity to sample many different kinds. But liking coffee and starting a coffee business are as different as an Eskimo is to an Eskimo pie ice cream. And did I mention that Chuck did not have an MBA in anything? He was an English teacher at the local community colleges.

But remember Rule No. #218: Grand passion and relentless pursuit will take you further than good grades. And Chuck was long on passion.

“The business evolved while I was teaching,” said Chuck. “It started out as an after-hours business. I roasted coffee in the kitchen of the Veterans of Foreign Wars in Pacific Beach and sold it at the La Jolla farmers market. I started to understand the basic concepts of the coffee business such as the different kinds of beans, how to price and how to service wholesale customers. I learned gradually.”

One year after getting the coffee roaster, Chuck quit teaching to formally start what has become Bird Rock Coffee Roasters, which specializes in offering quality coffee that he buys directly from the growers. The business operates one retail location in La Jolla, is opening another in the Little Italy area late this summer and also has a wholesale operation. In 2011, it was recognized as Micro Coffee Roaster of the Year by Roast magazine.

Meanwhile, Elke stayed at her position in a multinational, publicly traded financial-services company until last year, when she left to focus on growing the business. The go-slow, put your foot in one toe at a time is often a good way to start, and having one family member keep their job can provide much-needed stability in the throes of all the ups and downs of a startup.

Neil’s note: Having only one member of the family deeply involved at the beginning adds longevity to a marriage.

As the business grew, Chuck subleased a retail space in a restaurant in the Bird Rock area of La Jolla and operated a kiosk in a grocery store parking lot. He also purchased a small wholesale business that owned a larger roaster. The one-step-at-a-time strategy.

Then in 2006, the Pattons took a big leap and opened the first Bird Rock Coffee Roasters independent retail location across the street from a Starbucks in La Jolla. Some people thought they were crazy to locate so close to the competition.

Neil’s note: So you tell me, why are there often four gas stations on four corners? Because it works.

“When you’re opening up across from Starbucks, people are already coming to that location to buy coffee so you don’t have to change too many habits. It would have been harder if we were two to three blocks away,” Chuck said.

A big plus in their favor was their knowledge of the community. They had lived five blocks away for 11 years, and both had been active in local organizations.

“The community saw the hard work that we were putting in, and so people gave us a shot. But we knew that people would only come back if the coffee was special. It is hard to compete against Starbucks, which does everything so well,” he said.

Initial capital of under $75,000 came from putting a second trust deed on their house. At this point, I would argue they were “all in.” Chuck wrote a simple business plan and sought advice from a SCORE counselor. The couple purchased the building in which they started, and they have rented adjacent space as the business grew.

Starting a business can put a lot of stress on a marriage. Fortunately, Chuck and Elke recognized that they have very different skill sets. While Chuck focuses on the coffee (even traveling to visit the growers), Elke’s strength is on the financial side. Since she is a former statistician who moved into product management, she is in charge of operations including technology, bookkeeping, human resources and insurance.

What keeps them up at night? “Our expansion plans, ensuring that we continue to source quality coffee, and to stay recognized on the national level. I want be one of the top five in the country,” said Chuck.

Rule No. 355

One step at a time is fine, as long as they are all in the same direction.

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