What's the Buzz?

Despite competition from large chains, Vermonter-owned coffee houses are perking right along, thank you

by Jason Koornick

Chittenden County may be a long way from Seattle, but if the number of coffee shops is any indication, people in northern Vermont know and love their coffee. Owners of local shops might have been worried when they found out that corporate giant Starbucks was opening a store in downtown Burlington, but those fears have been put to rest as city residents have proven there is no such thing as too much coffee in the Queen City.

"Since Starbucks opened, we have been busier than ever," says Carrie MacKillop, co-owner of Muddy Waters. The sentiment is echoed by Skip Blakely of Uncommon Grounds, whose shop is opposite Starbucks on Church Street, demonstrating that the coffee market is not saturated in Burlington.

The diversity of coffee shops might account for the area's ability to sustain such a high number of them. The shops vary in terms of their products, clientele and overall goals. Here is a brief rundown of locally owned coffee shops with a focus on the people behind the brew.

Muddy Waters, 184 Main St., Burlington

Co-owner Mark MacKillop says that the atmosphere of Muddy Waters was an important consideration when he and his wife, Carrie, opened in 1994.

Muddy Waters is just a few steps from the city's downtown pedestrian marketplace, and that's exactly what owners Carrie and Mark MacKillop wanted when they opened the store in May 1994. "We spent a lot of time looking for the right space," Carrie says. "We wanted someplace that was off the main drag where locals could find us and so could tourists if they wanted to. And we save quite a bit of money on rent by being off Church Street."

For the MacKillops, creating an atmosphere where people would feel comfortable was the most important consideration. "For us, it's not about glorifying the bean but creating a community venue where people can meet and hang out," she says.

Coffee and specialty drinks are just one piece of Muddy Waters' business. The shop also sells beer, wine, pastries and food from local vendors. "Anything we can we buy locally," Carrie says.

The exception, she pointed out, is the coffee, which comes from an organic roaster in Massachusetts. "We decided not to sell Green Mountian Coffee Roasters products because, at the time, everyone else in town had it," she says.

Since 1994, Carrie has seen a considerable change in the local coffee market. "People have gotten a lot more sophisticated," she says, "and the market has also gotten younger." She attributes the trend toward greater knowledge about specialty coffee partly to one of her competitors, Starbucks. "They have really played a role in educating people," she says.

Carrie explained that business has grown steadily since they opened, but the high cost of ingredients has affected Muddy Waters' profitability. "Premium ingredients take a lot out of the bottom line, but the customers can really tell the difference," she says.

The Kept Writer, 5 Lake St., St. Albans

To Jedd Kettler and his wife, Launie, coffee and used books are a perfect match. Their passion for literature and desire to open their own store were the impetus for The Kept Writer. The used bookstore/cafe opened in July 2000.

"We had been talking about opening a used bookstore, but the idea evolved into more of a coffee shop because it was simpler to run and more of a daily hangout," Jedd says. He estimates that 65 percent of the store's business is in coffee and food with the rest coming from the sale of used books.

The Kettlers, who are native Vermonters, saw a rare opportunity in St. Albans, since it is a growing area and didn't have as many coffee shops and bookstores as Burlington. "We thought that we could complement the area with our concept," he says.

He says the response from the community has been greater than they expected. The Kept Writer is a young business, and the Kettlers expect that their place in the community will become more firmly established. "We have many loyal customers who tell us that the town needs a place like The Kept Writer," says Jedd.

The store has become a community gathering place, with live music at least once a week and other events, such as readings and fund-raisers, periodically.

The Kettlers buy their coffee from Uncommon Grounds in Burlington. "It's not just that we get our coffee locally, but more because it's really good coffee," he says. The cafe's food is made off the premises.

Kettler says the business lost money in its first year. He's still doing the numbers for 2001, but he expects to be in the black. "We are just squeaking by," he says.

Speeder & Earl's, 412 Pine St. and 104 Church St., Burlington

Jeannie Kail (left) and her daughter, Jessica Workman, are dwarfed by the giant roaster Speeder & Earls uses for its sought-after beans.

Speeder & Earl's, which got its name from the lyrics of "Speedo," a 1950s song by the Cadillacs "They often call me Speedo, but my real name is Mr. Earl" opened two stores in June 1993. The main store, on Pine Street, is owned by Jeannie Kail, one of the company's founders. The second location, a walk-in store on Church Street, was sold in 1997, but still sells Speeder & Earl's coffee exclusively.

Kail says when she and her then-husband, Gordon Blankenburg, moved to Burlington in 1992, they noticed a lack of quality coffee in the area. "In particular, there was no quality small-batch roastery," she says. For the first few years, the Church Street location sustained the new business. "There was nothing happening on Pine Street," she says, but they kept the space to run the roastery and wholesale business. Pine Street has since become home to numerous businesses, and Kail says the business is growing at a rate she and her partner and daughter, Jessica Workman, are comfortable with.

"We do about 50 percent retail and 50 percent wholesale," she says. Speeder & Earl's supplies coffee to a few New England colleges and is working on an arrangement with the University of Vermont.

Kail says the quality of their beans and their small-batch roasting process make for a superior coffee. The beans are supplied by a distributor from New York who personally selects the beans from farms around the world. When the beans arrive, Kail inspects each batch to make sure it is up to the company's standards. "I haven't sent any beans back in a while, but I have been known to do it," she says.

Kail would like to see the opening of more Speeder & Earl's locations. She would also like to expand into more colleges and grow the wholesale business. She says the business is in the black. "Since my daughter came on board in 1998, it has been more profitable."

Uncommon Grounds, 42 Church St., Burlington

Skip Blakely has seen a lot of changes in the coffee business since he opened Uncommon Grounds in May 1994. The most recent development is the opening of Starbucks in Burlington Town Center directly across the Marketplace from his shop. "I'm not worried about Starbucks," he says. "The competition is good. It makes everyone take a look inwards at their operation. It means fair prices and good service for the customer."

Not that Blakely and his wife, Beverly, have had any problems keeping their customers happy. "We take our coffee very seriously and our customers can tell the difference," he says. Blakely explained that his ingredients and the in-house roasting process make Uncommon Grounds' coffee stand out from the rest.

"We roast the best arabica beans that we can find daily," he says, "and every drop of water is filtered twice before it even touches the grounds. The difference between fresh and not freshly roasted coffee is noticeable."

Blakely had decided to own a coffee shop three years before Uncommon Grounds opened its doors. He did extensive research into the coffee business and his potential customer base before deciding on Burlington. He chose the Queen City because of the number of colleges and year-round residents.

Uncommon Grounds also sells coffee wholesale and through mail-order. Together they account for 20 percent of the company's revenue. "We mail our coffee all over the world," he says. "We do our wholesale differently. We sell coffee only, not equipment, and we don't try to compete with distributors. We develop specific blends for mostly local restaurants."

"We've done quite well here," Blakely says. "I don't consider the other shops competition, because most are also restaurants. Any time there are more people in the coffee business, it's good for everybody."

Radio Bean, 8 N. Winooski Ave., Burlington

Lee Anderson says he opened the Radio Bean Coffee House for the people motive, not the profit motive. He serves only organic fair-trade coffee.

Lee Anderson started the Radio Bean Coffee House in Burlington's Old North End for what he calls "the people motive, not the profit motive. I want Radio Bean to become a podium for the community," he says about the business, which opened in November 2000.

As part of his mission, Anderson is putting a low-powered radio station into the cafe. The project is in the FCC licensing process, and Anderson hopes to have it on the air by spring. "It will be a non-profit, non-commercial community station that can be heard in Burlington," he says. "We want to enable free speech and give a voice that corporate media can't provide." Most of the financing will come from cafe business and grants, he explained.

The coffee served at Radio Bean fits into Anderson's social agenda. The shop serves only organic fair-trade coffee that is grown on an indigenous Mayan farming co-op in Mexico. Anderson says that although it is more expensive, the quality and virtue make it worthwhile.

Radio Bean serves mostly people who live in the Old North End. Anderson estimates that the demographics of his clientele closely resemble those of the Burlington population. He claims the cafe is also a destination for some patrons who come for the frequent live music performances, poetry readings or independent film screenings.

"It doesn't matter if it's coffee, tea, beer or wine; drinking seems to be an important part of building any kind of community," he says.

The Village Cup, Vermont 15, Jericho

Kim Evans and her husband, Stephen Dissenderfer, opened the Village Cup in Jericho in May 2000. She had seven years' experience in the coffee business from running two stores outside of Harrisburg, Pa., before they moved to Vermont.

Evans had two goals when starting the Village Cup: to support her family and to give something back to the area where she lives. "I've always been looking for business ventures that are community-oriented," she says.

The couple chose to open the Village Cup in Jericho more out of circumstance than for strategic reasons. "There were other spots with larger populations, but we liked the community of Jericho," she says. Since the cafe is attached to their home, Evans and Dissenderfer were able to create a work situation that was ideal for their lifestyle and allowed them to be close to their two children.

Families with children make up a significant portion of their clientele, in part due to the many family-oriented events at the cafe, she says. The Village Cup features live music on weekends, monthly community dinners and workshops for children.

The Village Cup buys its coffee from an independent roaster in Pennsylvania whom Evans used when she ran her businesses there. By working with a familiar distributor, Evans is confident that the beans are the highest quality and grown under fair-trade practices. "There's a lot of politics in the coffee business right now," she says.

The Village Cup also serves gourmet sandwiches and soups. Evans says the business has been profitable since it opened.

Evans and Dissenderfer don't have specific plans for future growth or expansion, but she won't rule out the possibility of opening another location. "For now, we are pretty comfortable with what we are doing. We're heavily invested in this location," Evans says.

1820 Coffee House, 6 Carmichael St., Essex

Contrary to its name, the 1820 Coffee House was opened in 1999 by Don and Mary Russell. The inspiration for the business came from an old farmhouse on Vermont 15 in Essex that was for sale at the end of 1998. "We loved the old house and wanted to restore it," Mary says. "We thought that a coffee house was a good use."

It took the couple a full year to renovate the building and to write the business plan. From the first day the cafe was open, the owners found that the demand for lunch was high. They started serving lunch soon after, and now food is a big part of their business. "We do as much as we can with a small kitchen," she says. About 60 percent of business is in food sales with the rest in coffee.

"We spent a lot of time trying different coffees and roasts," she says. The couple decided on a small roastery from California that roasts beans to order.

Business has been indirectly affected by the growth of the neighboring Essex Outlet Fair, but Mary says she doesn't have specific figures. "Since we've opened, we have continued to grow," she says. "Word of mouth has been the biggest draw. We have customers who come in from when we first opened."

Koval's Coffee, Taft Corners Shopping Center, Williston

Marge Koval and Ken, the oldest of her seven sons, have run Koval's Coffee since Marge's husband died last year. Coffee and doughnuts are staples at the Williston shop.

Koval's Coffee was started in 1986 because co-owner Ed Koval wanted a career change from his 18 years at General Electric. The Williston business started out as a franchise of Whole Donut. In 1994, Ed and his wife, Marge, struck out on their own.

Marge says they couldn't have chosen a better location than Taft Corners. "It has always been a good business." She adds that traffic has increased exponentially since they opened. "There must be 30,000 people going through Taft Corners each day," she says.

Coffee and homemade doughnuts have been the staple of Koval's Coffee business from the start. It accounts for about 60 percent of the total income. They also serve about 70 to 100 lunches every day. The coffee is supplied by Winslow's, formerly New England Coffee. She says the secret to their coffee is in the grind and the high temperature at which it is brewed.

The past year has been a tough one for Marge. Ed died in September 2001, and the business was affected by construction at Taft Corners that made people "avoid the intersection like the plague," she says. For a while last summer, the driveway into the shopping center was blocked by construction equipment.

Despite the temporary setbacks, Marge expects that Koval's will remain at that location for many years. "This shop has charisma and a heartbeat," she says. "The best part is meeting all the people. That was always the best part for Ed."

Java Dreams, Champlain Mill, Winooski

Jennifer Prinz and her partner, Mark Kalbfleisch, bought the Green Mountain Coffee Roasters retail store in September 1998. The store has been at the Winooski location for 19 years, and the new owners recognized the benefits of name recognition and Green Mountain's association with quality products.

Prinz says that traffic has declined steadily over the past five years with the closing of many stores in the Champlain Mill. "There is great character in this building and it has many built-in offices," she says, "but there are half the number of stores that were here five years ago."

The Winooski Downtown Redevelopment Project has put the fate of many Winooski businesses up in the air, and Java Dreams is no exception. "If the project goes through, it will be great for Winooski and the businesses that can weather the transition," she says.

Java Dreams sells exclusively Green Mountain Coffee Roasters coffee, although it has not been obligated to do so since its exclusive arrangement expired two years ago. Espresso is made from the business's own blend of GMCR coffees.

Besides coffee, Java Dreams sells gifts, coffee accessories and Vermont products. Prinz says one-third of the store's business comes during the holiday season when customers make special trips to Java Dreams. For the rest of the year, she says, Java dreams is not as much of a destination.

Business has not been as profitable in recent years, says Prinz, "but we're not losing a lot of money each year."

Grand Finale Kaffee Shop and Edelweiss Desserts, 24 Main St., Winooski

Ken Schlegel, general manager, and April Cootware, sales and service, survey the goodies at Edelweiss Desserts, attached to Grand Finale Kaffee Shop in Winooski.

Owner Ralf LaBelle and his general manager, Ken Schlegel, have created a piece of continental Europe in downtown Winooski with Grand Finale Kaffee Shop. The cafe, an extension of the Edelweiss bakery, opened in June 2000. The food, atmosphere and dark, rich coffees work together to re-create the European experience, LaBelle explains.

Edelweiss opened its second location on Main Street in 1999 after four years in the Champlain Mill. The corner space he wanted for the cafe was unavailable, so he moved into the adjacent location, which still houses the bakery. The landlord agreed to give Edelweiss right of first refusal on the corner spot for the coffee shop. When the corner space became available, they broke down the wall separating the two areas and Grand Finale was born. The store in the Champlain Mill closed in 1999.

LaBelle serves coffee from Starbucks, mostly because he "got a good deal through Costco," but also because he felt Starbucks' dark roast was well suited to the goals of Grand Finale. He says that 60 percent of the shop's business is in baked goods and 40 percent in coffee sales. The business has been profitable since it opened.

The cafe serves generous gourmet lunches five days a week. "Mostly soups, sandwiches, some salads and hot items," says LaBelle. A Sunday brunch specializes in lighter European fare. "We don't do as much bacon and eggs but more fresh fruit, cheeses and homemade pastries." •

Originally published in February 2002 Business People-Vermont