I've mentioned this in passing a few times, but if you don't mind, I'd like to get up on this soapbox for a minute and preach some truth.
Here's what we all know is wrong with the independant specialty coffee industry: mainly, for your shop to be what you want it to be, you need committed, highly trained workers, who care about the shop, and are dedicated to becoming better at what they do every day. Normally for any business, the way to have an elite staff like this is to offer them a competitive wage, maybe with benefits. Of course most shops only make enough to pay little more than minimum wage, so all they can do is hope that their shop is cool enough that it's worth it for the expert barista to take the small wage in exchange for "the lifestyle". Or you scale down your shop enough that you and your partner or whatever run it yourselves. You suffer from high worker turnover, lack of commitment, lack of new ideas, and you spread yourself thin trying to control every aspect of the shop and keep it up to a high standard.
There is only one solution to this, and the coffee community needs to be aware of it as a viable option: The worker-owned coffee house; the cooperative model. No, I am not a communist or an overly idealistic hippy; this is a highly effective, tried and true form of micro-capitalism. Why do you need heirarchy to run a business? Why do you need a boss? This country was founded on democracy, why don't we incorporate it into our businesses?
1. the big one: With every worker sharing in the profits and decision making, you can have a commitment to quality that single shop owners can only dream of. Many baristas do their best because it's in their nature, but imagine the energy and effort these baristas would put in if every drink sold meant money in their pocket. If the cafe they were working at was literally THEIR cafe and treated it as such.
2. the many armed manager: A single manager is limited and overworked. By dividing managerial tasks among all the members, you can do everything you ever wanted to do with a cafe, and do it better. For each task a single person is accountable, and more effective because it's the only task they need to focus on.
3. the startup: there are so many passionate baristas who have dreamed of owning their own shop, and almost none of them have access to the capital it takes to do it, or the ability to get bank loans. F%#@ the banks, they got us into this mess in the first place, we don't need them. If each member can scratch together a few thousand, you're probably almost halfway there. There are many non-bank lenders out there, especially for coops, grants, crowdraising websites... And if you have 8 or 9 workers, it's 8 or 9 times easier to fund your business than it would be on your own.
4. no decision gets made without you. It can be hard to get everyone to agree on some things, but this also means that each major decision gets scrutinzed, discussed, and researched thouroughly.
5. financial advantages: you don't have to pay worker's comp tax because everyone's an owner. Also, you pay very little tax on the business income because at any time you can divy up the business' earnings and give it to yourselves as tax deductable dividends. So basically, you cut out employment costs and manager costs, raise your profit by out-competing everyone, have the man-power to do additional revenue raising things, and cut costs to outside contractors by having a large pool of skills and doing more things in-house.
My core members and I just got done interviewing nearly 30 highly qualified people with a variety of different skills and specialties. All passionate about coffee, tired of having a boss, or tired of being a boss (this model also gives you the rare ability to own a business and actually live your life a bit), tired of their hard work being overshadowed by useless co-workers or ignorant owners, and tired of being paid almost nothing to do a job that if done right takes years of experience. On the job listing I stated that it would take some financial contribution, and about six months until we open, yet people have been scrambling to be a part of it. Once we have the group and pool our resources, we can work out the lease for the building we want, get the permits going. If things are on schedule, we'll be open in 6 months. Of course they probably won't be on schedule, but we're prepared for that.
How to start:
-research research research research.
-learn your state's coop laws, get in touch with cooperatives, ask them (somewhat informed) questions and they will help you, talk to cafe owners and small business owners.
-write your business plan. If you need help, look for free business plan writing workshops, there are probably some in your area.
-Assemble a core group. Not just anyone but people you know you can trust and depend on, and who share your general vision of what you want the shop to be. You only need 2 or 3 people to get the ball rolling. When your core group is SURE they will see this through to the end, put up ads advertising for applicants. I made the mistake of wasting a lot of time asking a lot of friends, acquantances, and random baristas if they were interested. And of course everyone was "interested" but probably about 10 people have come and gone from our collective. Instead let people who really want it come to you and compete for the position. Pay the $75 for the craigslist job posting, it's the best money I've ever spent. You have no idea how many people have just been waiting for an opportunity like this. Before you advertise for the position, make sure your business plan is solid: 1. you'll get more serious applicants that way, and 2. it will ensure that the people coming to you already generally agree with your vision as a foundation.
I had to write this. I've seen people post and post about the frustrations in this business, and experienced most of them myself. I believe this is the only way the specialty coffee industry can improve, you've all experimented with every brew method imaginable, and micro roasters aren't going to get much better than what we've got now. The only way to be better is by raising the consistancy of quality and dedication in our shops, and the only way to do that is by making being a barista a financially viable job. There are just too many intelligent, passionate, creative coffee people out there not to tap into that potential; merely employing them is a waste of their potential.
It's not that it CAN'T work, but the solution doesn't provide the right answers. The idea that this alternative will provide a better standard of pay for the workers really isn't so. In the end you have a group of workers, being paid like workers, not a group of owners being paid like owners.
Partnerships are tricky enough, but having 3 or 4 or 10 owners will bring more headaches and confusion and less reward. I have a few friends that I have known for twenty plus years, and I wouldn't go into business with any of them -- and they're all experts in their own fields. Not everyone is cut out to have a business, to be an owner. And the likelihood that a group of X people who want to have a business actually have the tenacity and skill and business smarts to do it is unlikely.
The reason there are so many hoops to jump through, such difficulty getting funding and creating a business, is to weed out those who are likely to fail. You sound like more of a leader than a follower, and if that's the case, step up and do what YOU need to do to have YOUR business. Maybe offer a buy in or a percentage of profits when management and staff have proven results. We can love what we do, but in the end, results matter. Reward results.
"Here's what we all know is wrong with the independent specialty coffee industry: mainly, for your shop to be what you want it to be, you need committed, highly trained workers, who care about the shop, and are dedicated to becoming better at what they do every day. "
The problem is not that the system needs to be scraped but it needs to change from the top down.
The solution to the above problem is to hire people who care and are already dedicated to becoming better in other areas of life.
By dangling money in front of the face of some ingrate you will not then reform him. There's an old saying that goes, "A man convinced against his will, is of the same opinion still"
You will always have to be the boss and enforce a standard. The problem is not with the system it is with the people. There are plenty of restaurants out there where the employees are passionate, dedicated, always improving etc...
is this because they are paid well?...later on maybe...
but first they were hired because they were ALREADY passionate, dedicated, always improving etc...
There are so many chefs in training as we speak, who are doing a "stage" in a kitchen...where they work for FREE just for the experience.
Now...if we as an industry insist on hiring bums and acting as if we are going to reform them by our magical training prowess....we are fooling, and have been fooling ourselves.
Yes we have to give our employees benefits and treat them well...treat them great! But I still expect a lot from them from the very beginning.
Many owners and managers open their bars and immediately lose control because they hire out of desperation.
When owners start hiring "up" then we will see a change in the bleak landscape of apathetic baristas. They should be weeded out in the hiring process. And if that does not work, once they show their true colors in a trial period (which you should have)...then fire them. Seriously.
If you don't you will lose control and you will turn into the Barista version of "the cat lady"
taking in strays because they are cute but with an inability to properly care for them...eventually you will end up having to burn the thing down or get used to the smell.
"Are we talking about Doug Zell or most of the owners on this board?
Because my manager makes more than I do."
Then you wouldn't have much to lose by distributing pay evenly, would you? Except that you seem to believe that your business would fail if you let the group make decisions democratically. Again, nothing inherently wrong with dictatorship in business, as long as you're a benevolent dictator, which you seem to be.
"how are you going to feel and react if the group decides against your position, regardless of how "convincing" you present your argument?"
I'd feel pretty good about it. I don't know everything, and clearly someone else's position was more convincing than mine.
"My baristas paychecks are a direct result of the work they put in."
Now this is more naive than anything I've said. I've worked many jobs, and heard many excuses for why management "just can't afford to give raises right now, as much as we'd like to", or if faced with me having to leave the company to pay my rent, will offer a token raise and act as if I've swindled him out of a kidney. This trickle down idea doesn't hold much water when I have no idea how much profit is being brought in, and no guarantee that you will deem me worthy of a raise, or how much. Basically, me working extra hard for you for an eventual raise is a pretty low yield investment.
Or are you just saying that without your business, there is no paycheck? If so, you could just as easily say that without your employees, you have no business. Neither of those sound like much of an incentive to me, because service jobs and service workers are a dime a dozen.
I've also worked for larger corporations (not coffee) and been paid very well, with the enjoyable trade off of feeling like you're part of a human bridge, over which people in higher positions walk without even having to know that you exist. You can see why an alternate solution might be desirable to some of us.
"You should be working harder than your co-workers. And if you start to feel silly about it, go work somewhere else."
I understand where you're coming from and I agree to a point. I did end up quitting. Under the former owner, I put everything I had into the business because I believed in it, and enjoyed it, so I didn't mind the relatively low wage. With the change in ownership, it quickly became apparent that I cared more than the owner. The ex-Peets workers that replaced the old guard learned to care as much as the owner, so I was left trying to push the broken car, with the owner asleep at the wheel and employees sitting on the hood. So of course I did leave, but it was hard having invested myself as a worker for years in something, and watching my investment destroyed by someone who did little more than write a check. I bought the illusion that my work affected my paycheck. But that is only true if everyone involved cooperates in making the business successful. And if that is true, then why not make it a true cooperative effort?
I agree that this model is as perilous is a normal model, just in different ways, and in some similar ways. And the benefits are different but can be better for some than owning their own shop, or working for one. You came up with some good arguments based on your experience, but I don't think any of them can't be resolved. And of course your opinion will be skewed because you know the traditional model inside and out and it's worked for you, therefore this opposite way of business must be flawed. But they're not mutually exclusive; there is a niche for this model in the capitalistic system, it's not like I'm the first to think of this. And there are successful and less successful coops as precedent. I know that you and the other owners on this site are changing the industry, and I applaud that too. But I think this model can help to spread that change. Fundamentally, coops are ideal for businesses where the workers are there primarily out of a passion for it, since it's just about impossible to get rich in a cooperative. Did you think you were going to get rich in the coffee business? Did you think you'd achieve the dream for some of opening a successful business and then kicking back and watching the money roll in? Most likely it was for the idealistic purpose of making a living doing what makes you happy.
"Sadly, there are more failures in co-ops (or straight businesses) than successes "
Exactly. I didn't say it was bulletproof. I'm saying it can be a very good tool that is underutilized in small business because people don't know that much about it. Hence, this thread.
So yes, I'll be happy to get back to you when we're open and doing well. But if I waited for that to happen, there'd be no room for argument. I think we've gone over just about every pro and con of this system, and we've brought all this to the attention of the coffee community (at least this one). The cooperative movement has been growing for a while, and it tends to happen in clusters of types of business: groceries, bakeries, printing presses, day care (apparently), etc. I'm just trying to help set a precedent for coffee, which seems ripe for this model.
Thanks for your comments!