From the FT: Reaching for the Starbucks

by Reiss Gunson on Wednesday, 13 May 2009 02:22

We have decided to republish this article directly from the FT in full, as it says the same as what we have been saying ad nauseum. That is to say, Starbucks is not about espresso. We have placed the key paragraphs in bold and italics.

By Christopher Caldwell

Published: February 20 2009 19:17 | Last updated: February 20 2009 19:17

The decision of Starbucks to begin marketing Via, its own brand of instant coffee, is a powerful symbol of something â either of the unexpected resilience of innovative companies or the collapse of the whole logic of the consumer economy.

The struggles of Starbucks are well known. Its stock lost half its value last year, and store sales were off 9 per cent in the most recent quarter. The company announced in January that it would shed 6,700 jobs and close 300 more outlets, after shuttering 600 last year. Other espresso chains are nipping at its heels, some with better services (such as Caribou in the US, where high-speed internet is free), some with lower prices (such as Dunkinâ Donuts). Home-grown competitors are rising in important markets â for example Costa Coffee and Caffè Nero in Britain. People differ on whether Starbucks has expanded too fast â losing sight of the bohemian ambience that was its main selling point â or whether peddling coffee for several dollars, or pounds, a cup is a non-starter in this straitened economy.

Whatever the problem is, it is hard to see how instant coffee could be the way out of it. One prong in the Via marketing strategy is to sell it through the discount retailers Target and Costco for about $1 a sachet. That is a lot of money. While there is a logic in selling premium coffee at a premium, there seems to be little in selling so-so coffee at five times the price of other so-so coffee. The second prong is to sell it, starting in March, in Starbucks stores in three cities â Seattle, Chicago and London. That makes sense: 81 per cent of the coffee drunk in Britain is instant, and the world instant coffee market generates $17bn (â ¬13.5bn, £11.9bn) in sales. So perhaps Starbucks can sell enough in prestige markets to convince shoppers elsewhere to buy it in bulk.

That would be in character. Ever since it began expanding, Starbucks has worked by paradox and misdirection. _It is supposed to be a chain of espresso bars but, in the US at least, it has been years since most Starbucks have stocked proper espresso cups. A shot of espresso comes as a little puddle rolling back and forth at the bottom of a pint paper cup meant to hold some other concoction, most likely one with lots of steamed milk and syrup. Starbucks is basically a malt shop and this should not surprise us. Creamy foods are always popular in booms. The great food fad of the 1920s, the historian Frederick Lewis Allen tells us, was â Eskimo Pieâ , and US ice cream production rose 45 per cent in the seven years to 1926. The genius of Starbucks is to keep its identity as a coffee shop, letting its customers feel more virtuous than if the place they habitually nip off to at 10:15am were called the Dairy Tub, or something like that.

This makes the shift to instant coffee easier. If you are selling milkshakes, the quality of the coffee is not that important, any more than the quality of scotch is important to someone whose favourite drink is scotch-and-coke._ But there is a problem with instant, too. Part of what Starbucks founder Howard Schultz calls â the Starbucks experienceâ has always been a matter of class. Starbucks has managed to give its customers the feeling they are â inâ in two ways.

The first is through its reputation as a â responsible corporate citizenâ . Starbucks offers health insurance to employees who work 20 hours a week or more and has been punctilious about trading only with ethical coffee growers. These choices are defrayed through higher retail prices. Since people who care about corporate responsibility tend to be well-educated, and hence well-paid, caring is a class marker. Corporate responsibility and conspicuous consumption are near relations. You can â feel goodâ about ordering Starbucks in more ways than one.

The second link to class is through real estate. This may hold the key to the companyâ s difficulties. Starbucks has had a genius for sizing up properties and picking locations. The company starts, according to the writer Taylor Clark with â a database ranking every US metropolitan area according to the qualities Starbucks found especially desirable â high income, high population and high educationâ . In plotting its expansion this way, Starbucks not only collected information but generated it. An up-and-coming neighbourhood would have a Starbucks: a superficially similar but stagnant one would not. In the very act of its site selection it became a sort of rating agency. One extraordinary side-effect of Starbucksâ retrenchment is that, as outlets have closed â particularly in struggling cities such as Newark, New Jersey â protests have arisen to â Save Our Starbucksâ . Naturally! A closed Starbucks signals a downgrading of the neighbourhood. But picking real-estate winners is not as lucrative now as it was a couple years ago.

Starbucks may have come up against the limits of its model. The chain will have to serve a different function in the bust economy than in the boom. Maybe espresso bars could thrive as purveyors of â cheap luxuryâ , the way cinemas did in the 1930s. A lot of people thought that the collapse of phoney equity values would make people turn to healthy, high-value food. But, really, that almost never happens â the natural food craze of the late 1970s was a cultural coincidence, not an economic effect. As this paper has reported, people today are turning to fast food, fish and chips and other comfort foods. â The less money you have, the less inclined you feel to spend it on wholesome food,â George Orwell wrote in The Road to Wigan Pier. â When you are unemployed, which is to say when you are underfed, harassed, bored and miserable, you donâ t want to eat dull wholesome food. You want something a little bit â tastyâ .â The taste for the kind of sweet drinks Starbucks serves is unlikely to wane any time soon.

The best coffee in town can be at your place!

by Reiss Gunson on Wednesday, 13 May 2009 02:20

we’ve said it before, we’ll say it again, most cafes buy the least expensive coffee they can find, and anything from italy must be good right, because everyone knows the best coffee comes from italy, right?

er, no, not necessarily at all. they’re often the same people who think coffee is grown in italy, when not a single bean is!

lets be clear, we love going to italy & all things italian & some superb roasters practice their art there, but the bulk commercial roasters? tell us your next joke!

quite simply, if you find yourself tightening your fiscal belt at the moment, there is no need to reach for the instant coffee just yet.

for a very modest outlay you can acquire our starter pack and you will find you are serving a nicer cup of coffee at home than you ever had on the high street & staying within your budget at the same time.

come over to the dark side. try londinium.

New in: SWP Cascadia

by Reiss Gunson on Wednesday, 13 May 2009 02:19

Yes, another decaf coffee

Why? because a customer demanded a decaf, but it HAD to be organic & fairtrade

All we could find right at the moment that fitted the criteria was this or a single origin Sumatran

We decided this was the safer bet as dry processed Sumatran can be rather over bearing as an espresso

This is a blend which we will detail when we load it up on the site

Anyway, we will most likely take delivery on Tuesday

This is a relatively expensive coffee so we have high expectations, particularly as the SWP Costa has set the bar so high

Send us a coffee question...

by Reiss Gunson on Wednesday, 13 May 2009 02:19

and we will answer it here for you.

It's not all doom and gloom. It's time to deliver value for money, that's all.

by Reiss Gunson on Wednesday, 13 May 2009 02:18

Despite the dire predictions of the newspapers, it isn’t all doom and gloom out there.

I’m not a pushy marketing man with an axe to grind, I’m not about to tell you that houses are gaining value and the world is all returning to normal. What I am about to write is based on what I have personally observed as I beat the streets of London visiting the cafes we serve and the cafes we would like to serve in the future.

There is a near perfect correlation between the cafes that appreciate the quality of the products and services we offer, and success. I can hear you saying, “ah yes, well he would say that”, and while I am a hard bitten cynic too, it is the truth.

The businesses who are struggling are those who like to blame external factors for their troubles, for example, “oh we can’t change from Illy because we need an international brand to compete with the Starbucks next door”. On this particular occasion I then paid for a cup of their Illy coffee to try it. Lets be quite clear, I may think Illy is over-priced, but correctly treated it can make an acceptable cup of coffee; i.e. I am not an ‘Illy-basher’. But this coffee was terrible! Why? Nothing to do with Illy! They had paid a premium for the brand, but they were lazy. So neither the machine nor grinder had been maintained, they skimped and used the tiniest amount of coffee (‘b/c we are struggling we have to cut corners runs the logic’), it was prepared by someone who didn’t want to be there, and so on. They still firmly believe they are struggling b/c of the Starbucks next door, the economy, etc.

As an outsider who had not visited the cafe before I saw things differently. I have driven past the cafe many times, and the daft thing is no Illy branding is visible so they are paying for a premium brand yet it is not visible until you are in the shop. The shop looks attractive as you pass by, it looks inviting enough. Yet the Starbucks next door is full and this cafe is empty. Why? Well it cant be the economy can it? I mean if people really didn’t have any money they wouldn’t be in Starbucks either.

The money exists, it hasn’t gone anywhere. All that has happened is that it has been redistributed (typically from young (buying prop)to old(selling prop)) and people’s expectations have changed. So people might not be throwing their money around with gay abandon as they did when they didn’t care if they lost their job as they would quickly find another, possibly on better pay, or when their house was appreciating at 15%pa.

They are still spending, albeit more cautiously. So the competition has increased. You just need to ensure they spend their £ with you, not your competition.

Example: Eating in a cafe is no longer inexpensive; today I had a citron tart on a take-out basis for which I was charged GBP3.20, which I thought was rather a lot, but you know I have had them numerous times before from this particular cafe and I really like them. I am still thinking that it was rather extravagant, which it was, but if you really enjoy it you feel you have received value for money & next time you pass that shop there is a good chance you will almost subliminally find yourself opening your wallet again, perhaps not even on the citron tart, you might think oh the citron tart was so good, the raspberry whatever looks good, I’ll try that instead this time. and so it goes. Conversely, if the citron tart was disappointing it is a long time before you go back again, especially in the current environment.

The favourite game in the London cafe scene is to sell crap to the passing tourist trade. ‘Its crap’ you say. ‘We know’ they respond, ‘but who cares b/c they have gone to Heathrow another 1,300 plane loads of tourists arrive from Heathrow tomorrow’. Well that attitude really grates with me and I see no reason why you shouldn’t go out of business if you live by that mantra.

People talk. With new methods of instant communication like twitter they talk a lot, and quickly, to many people, all over the globe.

OK, so they mightn’t remember the name of the awful places that screwed them as they made their way across Europe, but you will be surprised how they note down and remember the places where they had a good time and left feeling that they had received value for money.

For me ‘value for money’ is a phrase that we should start thinking about a lot more if we intend to get through this recession. It doesn’t mean cheap. Something can be very expensive (i.e. have a very high price) yet be perceived as value for money. Obviously the higher the price the higher the customer’s expectations for the product(service) before they consider to have received ‘value for money’.

For me value for money is a concept of ‘fairness’. You leave feeling you have received fair value in return for the consideration you paid. The colloquial antonym is ‘ripped-off’ and there are businesses all over London still deploying this approach and wondering why life is becoming more difficult.

Businesses who are prepared to take an honest look at themselves and decide if they are really delivering their customers ‘value for money’ will survive this downtime. Those who really put their back into it may even thrive. This is not a fanciful notion. We supply a very well run cafe who is in the process of opening another location because they have so many customers they are turning them away, even on a Monday. How? Why? What!

Well they have operated in their current location for a number of years and built up a loyal clientele. They have a very focused menu and do what they do extremely efficiently. Efficiently here doesn’t mean ‘low quality’, it simply means the process has been refined and refined to eliminate wastage and inefficiency, hence the ‘focused’ menu.

The current economic climate has meant that previously inflexible landlords and their agents have modified their expectations. As a result premises that were previously priced out of reach are now a viable proposition. It will give our customer a second location in a prime retail location with much more foot traffic. It will almost certainly be a success because the owner is ‘sticking to the knitting’, not diversifying into something he knows nothing about. In addition the owner is hands on. He doesn’t pop in for an hour in the morning and an hour at night. He is always there, driving the business forward. At the same time he is gradually adding the systems and controls that will allow him to manage two locations, and refining continually to minimise the negative events.

I have almost come to the conclusion that the retail food business has become overly focused on certification yet still failing to deliver quality. A certified apple doesn’t mean it doesn’t go stale or that it doesn’t bruise. You can have organic this and UK5 that, and fair trade this, and rainforest that, but if the food doesn’t taste any good and you try to charge people a daft premium for it in a downturn, don’t be surprised if the business is a bit quiet.

How about simplifying it. Take a clean sheet of paper and consider item by item what you are going to sell. Don’t add a single item that you dont personally love. Don’t add a single thing that you are not prepared to personally enthuse about to your customer at length. When all around is grim it is a delight to speak with someone who really loves the product they are selling. Then work out what it is going to cost, add in all your variable & fixed, direct & indirect costs, add on a premium that you consider a fair and reasonable reward for you effort and see what you end up with.

If you are an existing business and things are tough go back to the Landlord and spell it out. Not in a threatening manner, but perhaps take some accounts or at least key figures for the last say 3 years with you and demonstrate how things have deteriorated. Explain that you want to continue the business, but the current level of rent is strangling the business and if you are unable to make significant reductions you will have to relocate or possibly close the business. Negotiate. An intelligent landlord will much prefer to reduce the rent than take a bet on how long it might take to find another tenant who is willing to pay the same amount as you are currently paying.

A classic mistake that I see so often is shops that stock far too many things. This is doomed to fail in my view. You are not a supermarket. It is especially problematic if you are dealing in perishable items. You must identify a theme or a niche. This doesn’t mean tacky, it means specialisation. It means becoming famous for something. One thing. As already mentioned, news spreads fast these days, good or bad. If you are in London and you become famous for something, don’t be surprised if you have people from all corners of the globe coming to experience your take on ‘value for money’ for themselves. Set your sights high. Lead by example as the owner.

Oh, and another thing I almost forgot. If you pay your staff the minimum wage, with absolutely no form of incentive scheme, don’t be surprised if they seem a lot less enthusiastic than you about your goals and objectives. The English may sniff at the Americans, and sure the commission based retail model can produce some pretty obnoxious scenes when executed poorly, but on the whole I think it is preferable. I firmly believe that people who work hard, shoulder more than their share of the burden, go the extra mile if you like, need to be rewarded, and why not some filthy lucre?

If someone has gone beyond the call of duty and furthered your global reputation for excellence in whatever it is you want to become famous for, then give them a share of the spoils. I fully appreciate that it can be difficult to get the balance right, but I do not accept this as an excuse for simply doing nothing. In its crudest form you may simply declare that it is a discretionary bonus that will be paid weekly in whatever way you see fit. Some weeks it might all be paid to one person, other weeks it might be split equally, and so on. Some weeks nothing may be paid at all, whatever, its your scheme, just make the rules clear and abide by them. It may not even be money, but it needs to be something of value to the person concerned that clearly conveys that their additional contribution is valued.

Leaving cafes aside for a minute, there are businesses like our own that still need goods and services to survive. Sure, we may buy in smaller more frequent lots, or spend more time looking for the best deal, but there are a lot of things that we still need. Life goes on as the saying goes.

Let’s ignore the media & the politicians, they won’t get us out of this mess. Most likely small businesses will. How? By knuckling down and ensuring their customers perceive that they are receiving ‘value for money’. Just remember that approximately 95% of employees in the UK work for a firm that employs 5 or fewer people. Small firms (10-50 employees) generate more than half of the UK’s GDP. Most people don’t receive huge bonuses. Most people are remarkably like you and I, so let’s roll up our sleeves and make a difference by creating ‘activity’ which creates demand for goods and services. The money hasn’t gone anywhere, it has just stopped circulating because people’s expectations are fragile at the moment.

If you operate a small business and would like to bounce ideas around feel free to get in touch….we’re real people.

Chimney sweep blends

by Reiss Gunson on Wednesday, 13 May 2009 02:18

Cooking food at high temperatures, for example grilling or barbecuing meats, can lead to the formation of minute quantities of many potent carcinogens that are comparable to those found in cigarette smoke (i.e., benzopyrene). Charring of food resembles coking and tobacco pyrolysis, and produces similar carcinogens. There are several carcinogenic pyrolysis products, such as polynuclear aromatic hydrocarbons, which are converted by human enzymes into epoxides, which attach permanently to DNA.

The above statement applies equally to coffee that has been roasted very dark, which is generally pursued when you are using very low grade coffee and the sooty taste is deemed preferable to being able to taste the coffee itself.

We’re not health fanatics at Londinium, but we think this issue has been given scant attention to date, whilst caffeine seems to have received a disproportionate amount of coverage and if you believed even half of it you would have thought it would have exterminated the human race long ago.

All things in moderation we say, and if you seek out high quality coffee beans and roast them with care there should be no need to roast them very dark to the point where the bean is beginning to carbonise/turn to charcoal, even if they are intended for espresso use.

The myth that espresso beans must be roasted very dark must not be allowed to perpetuate.

Espresso doesn’t need to be burnt or bitter. It can be sweet and delicate.

Try a Londinium roast.

(the only exception to this is our SWP decaffeinated roast where the green beans have already been turned to a dark brown colour by the decaffeination process before we commence roasting). They also seem to require dark roasting to optimise the taste. Otherwise all our roasts are light.

Espresso standardisation, or reducing the witchcraft factor

by Reiss Gunson on Wednesday, 13 May 2009 02:16

In an effort to help you enjoy your Londinium coffee in the way we envisaged we now use Volvic water for all our taste tests.

This isn’t a plug for Volvic or that Volvic is better than any other water, it is simply a water with key attributes that are all ‘in range’ for espresso use (and there aren’t many bottled waters that are) and Volvic is readily available as a result of an extensive distribution network.

We hope this standardisation removes one more variable from your espresso equation.

As a reminder; 8g of coffee per shot, grind fine, tamp light, and target an extraction time of around 22s. We could also add water temp measured at the group head of 92C.

If you think Espresso beans should be Jet black...

by Reiss Gunson on Wednesday, 13 May 2009 02:16

....then you probably won’t like Londinium Espresso

We believe that coffee should be all about the ‘terrior’, similar to wine.

The concept of terroir developed through centuries of French wine making based on observation of what made wines from different regions, vineyards, or even different sections of the same vineyard so different from each other. The French began to crystallise the concept of terroir as a way of describing the unique aspects of a place that influences and shapes the wine made from it.

Long before the French, the wine making regions of the ancient world already developed a concept of different regions having the potential to create very different and distinct wines, even from the same grapes. The Ancient Greeks would stamp amphorae with the seal of the region they came from and soon different regions established reputations based on the quality of their wines.

If you only roast coffee just enough to caramelise the sucrose in the bean, which off sets the natural acidity in the bean, it is possible to preserve the natural characteristics of the bean that reflect the terroir of the coffee and produce a excellent, albeit unique, espresso

As far as we can tell the practice of roasting the beans very dark is associated with using inferior beans whose unique characteristics are not particularly desirable and therefore you seek to minimise their presence in the cup by roasting the daylights out of the bean. The only exception is decaffeinated coffee where the green beans have already been turned a very dark brown colour by the decaffeination process, and end up being very dark after roasting.

While it is true that many coffees are not particularly suitable for use as single origin espresso, many others are. With single origin espresso there is nowhere for the roaster to hide. The margin for error is much smaller, as it can not be masked by subsequent blending. The demand on the roaster for accuracy and precision is much greater. As is the need for good, clean, green coffee, with low defect rates and well graded to ensure all the beans are of a similar size. Otherwise the small beans end up burnt and the large beans end up under cooked and a poor cup of coffee results (a classic case of two wrongs not making a right)

How to make Turkish coffee

by Reiss Gunson on Wednesday, 13 May 2009 02:15

The Turkish coffee maker, called “cezve”, “jezve”, “briki”, “mbiki”, “toorka” or “ibrik”, has a wide bottom, a narrow neck, and a long handle. The traditional copper or brass design is preferred. It works best to use a pot to its full capacity, so you may want to own several sizes.

How to make Turkish Coffee
Ingredients:Start by adding to the ibrik 1 tsp of powder-grind coffee and 1 tsp of sugar (traditional but optional) to every 2 oz of water (assuming you will be using 2 oz servings). Add an extra oz of water to the mixture. The combined ingredients should fit just below the neck of the pot.

Brewing: Traditionally, and for the best taste, expect the brewing process to take 10-15 minutes. Slowly bring the mixture to a frothing boil on the stovetop. As the froth gets close to the top, just before it boils over, remove the Cezve from the fire, allow the froth to go down. Serve the froth in equal portions into each cup, then serve.

Serving:Fill each cup a bit at a time repeatedly, so that all cups have an even amount. Advise your guests to allow about a minute for the coffee grounds to settle to the bottom of the cup before gently sipping. Don’t drinking the grounds. The result can be a magnificent beverage.

i also remember reading a different variant whereby the water is boiled off, then topped up & boiled off again, then topped up a third time and poured once up to temperature. Comments welcome on the most ‘authentic’ method