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Coffee war: Caffeine comfort vs. corporate ‘gorillas’

June 22, 1997

NEW YORK (AP) _ There are still a few places where you can get a steaming cup of java served on a worn counter in a greasy diner that offers the comfort and familiarity of mom’s kitchen. But these days mom-and-pop simplicity is fighting for survival against the corporate caffeine gorillas.

Along a one-block stretch on Manhattan’s Upper West Side, a vintage neighborhood deli that still serves a 65-cent cup of joe, along with good-hearted chatter, is vying with three chain bars serving a variety of fancy brews that can top $3.50.

There’s Timothy’s, a shiny, glassed-in shop. Just up the street is tiny but tony Dalton. Across the street is the soon-to-open neighborhood Goliath _ Starbucks, which has computers, track lighting, something called ``rhumba″ chocolate-laced coffee, and no less than three kinds of sugar.

And alongside Starbucks is the family-owned Gotham Food deli, a neighborhood fixture for 20 years.

The new giants represent ``an assault on the smaller people trying to make it against a homogenized world, against the globalization of everything,″ says coffee drinker Robin Pluer.

That is not to say she frequents Gotham. She drinks her cappuccino at Dalton, a small New York chain, because ``this place is also kind of struggling″ and now will soon face Starbucks’ competition.

``I’m 100 percent sure we’ll be hurt, but I don’t know how much,″ said the Dalton manager, a Russian-born woman named Victoria who was reluctant to supply her last name along with her fears.

Alongside the fancy new establishments, the Gotham goes more for the common touch.

``We serve mostly working people,″ says Telemachos Tarabanis, a native of Greece who helps out in the business owned by his two sons-in-law, one Greek and the other Hungarian.

Along with some basic groceries, Gotham sells about 150 cups of drip coffee a day _ ``good Colombian coffee for average people,″ says manager Sergio Gonzalez. ``We’re squeezing by.″

Squeezing by in New York means about $15,000 a month rent for Gotham’s narrow storefront space. Starbucks would not discuss what it’s paying for a comparable space, formerly occupied by a candy store.

While Gotham stands alone, Starbucks has 1,200 bars across the country, with revenue of $215 million a year. Gotham employees on Sunday didn’t want to discuss fiscal details.

That makes the Seattle-based Starbucks ``a 300-pound gorilla,″ says Andrew Resnick, executive vice president of operations for Toronto-based Timothy’s, which has more than 70 venues in North America.

With the arrival of Starbucks, ``everybody is shocked. We don’t need another one here,″ says Gonzalez. ``What’s going on here on this street? They’re all going for the money.″

Some customers share his opinions of the big newcomers.

``Theirs isn’t better,″ said real estate agent Paul Palushaj, who depends on the Gotham for two morning cups of coffee. ``And what REALLY counts is not the coffee, it’s the atmosphere, the smiles, people who know you and say, `Hi! What’s going on with you? Que pasa? Buenos dias!‴

The slick new bars ``are cold,″ he added.

Starbucks begs to differ.

``We aggressively become a part of a neighborhood,″ says Lynn Schulte, Starbucks’ director of marketing for the Northeast and the Midwest. ``And we’re looking for neighborhood activities to sponsor.″

Asked if Starbucks targets its competitors, moving in on areas already occupied by other coffee houses, Schulte said only that the company looks ``for real estate that fits our needs, and we look for the demographics _ coffee drinkers. And then the customer ultimately chooses.″

The squeeze on the everyday cup of java is not just a New York trend.

In Anchorage, espresso has popped up in many bookstores, keeping people warm through the long, dark winters.

In Oklahoma City, when you can’t beat ‘em, join ’em: The Yippee-Yi-Yo Cafe is set inside the oldest grocery store in town, Kamp’s, which dates back to 1910. And in Albuquerque, coffee bars are attached to bagel shops, bookstores or bakeries.

America’s trendy espresso bars are modeled after Italian ones, but minus the clatter, chatter and chaos of a Mediterranean counter.

``It’s a family atmosphere here, people stand and sip coffee _ and talk about their work, how little time they have, their health, soccer, politics,″ says Gino Castrigno, speaking by telephone from his Cafe Alpino in Trieste, capital of Italy’s finest export coffee brands.

In the small bar his father once operated, he and his longtime clients ``have a relationship, they come for a kind of therapy, and they know we can soothe them.″

The new American bars ``are elegant, but they’re ascetic,″ said Castrigno.

Castrigno doesn’t trust American espresso and he also doesn’t appreciate American drip coffee.

The tried-and-true drip is sometimes a relief from the ``latte, fratte, gatte _ whatever they call all that fancy stuff that takes so much time to make. It’s annoying,″ said Dalton client David Eastman, who says Gotham has ``the most awful coffee in the world.″

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