Escondido Joe's Coffee House: Fresh start, same adversary

ESCONDIDO, Nov 16, 2008 (North County Times - McClatchy-Tribune Information Services via COMTEX) -- SBUX | Quote | Chart | News | PowerRating -- Many Americans, trying to save every dollar they can during tough financial times, have given up their daily, takeout coffee.

Starbucks shares and earnings have slipped recently, and the giant company is closing 600 company-operated stores in the U.S.

In a bold move, an entrepreneurial couple has opened an independent coffee shop in a very tough economy.

Damon and Barbara Parker opened Escondido Joe's Coffee House on Grand Avenue; previously, the location was home to a Lollicup franchise and before that a coffee shop with a religious tint called His Place. They hope the hometown name, family atmosphere, good customer service and free Internet access will win them steady customers.

They say they will do whatever it takes to make it work.

"I'm used to challenges," said Damon Parker. "I've started up successful companies. If I have to walk down Grand Avenue dressed as a cappuccino cup I'll do it."

He said he thinks people will cut expensive dinners out of their budget first, before visits to coffee houses.

"People still want to socialize and this is a great place to hang out," said Parker, a former title insurance executive. "I love being on Grand Avenue. It's the place here in Escondido. The Downtown Business Association is trying to bring in more live music. I lot of people say they'd like to support the mom-and-pop stores."

However, they are allowed to continue to serve Lollicup products and the popular Boba drinks, which have a tapioca base.

They're striving to create a niche with fresh-roasted coffee, pastries they make every day and some lunch items.

Parker said the couple saw the cafe for sale on a business opportunity Web site.

"We had come in here as customers when it was His Place. It's in our community, close to home," he said.

The new owners are setting a gross revenue goal of $300,000 in the first year.

They said they have no idea what a Starbucks would make, and no idea what they themselves might expect to net in their first year. They said the previous owner's sales were $150,000 last year, September to September. To make Escondido Joe's work, Parker said he is banking on his background in marketing and starting up successful businesses, as well as his experience in the restaurant business. He said his business plan is "hard work and letting people know about the place."

He believes Escondido Joe's success will be "a little bit about food and a lot about marketing."

He said the personality of the ownership is key; customers have to enjoy coming in and interacting with staff. To let other businesses know about the new ownership, Parker has taken them samples of the store's pastries. He's finding that staff from other Grand Avenue businesses are coming in on their lunch breaks now. Sometimes they check their e-mail. He lets customers do that at no charge, while the previous owner charged a fee, he said.

"People come in and they end up buying a drink," he said.

The Parkers also are giving out discount cards and coupons, and six weeks into their ownership of the shop, they're finding this brings in customers, too.

They are thinking about adding more entertainment to the coffee house, while keeping a family atmosphere. Barbara Parker works in the store and their son Cole, 10, helps after school.

"We'll use the fireplace now," Damon said. "The previous owners never used it. We'll have videos for kids to watch, and we're thinking about an amateur night."

Damon said sales are up 15 percent from the old Lollicup shop. "You have to either increase sales or lower costs," he said. "It's better to increase sales. You can only cut costs so much."

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