Erica O’Brien wanted a business that was inspiring, one that created community and human connection around food and one that served good coffee, tea and pastries.
In October 2010, that idea ultimately became The Rose Establishment.
On what would have been the Salt Lake City shop’s 10th anniversary, though, the doors at 235 S. 400 West were closed to prevent the spread of the coronavirus.
The shop had originally shuttered in March — along with every other food business. It reopened in May, only to close “for the time being” in June.
“People come to The Rose because they want to experience it, and they want to be inside and they want to connect,” O’Brien said. “So when that is something that’s not supposed to happen, it’s not a business that really succeeds during COVID.”
The Rose is not an outlier. The number of coffee or tea shops in the U.S. is expected to decrease 7.3% by the end of 2020, according to a story published by Bloomberg. Annual sales are estimated to drop 12% — to $24.7 billion, according to the report, which used research from Euromonitor International.
If that happens, it will be the first time in nearly a decade that growth in the coffee and tea industry has declined.
“Coffee shops that succeed in this new climate will need try to re-create as many of their popular pre-COVID-19 attributes as before while being in line with the new realities of social distancing,” Matthew Barry, a beverages consultant for Euromonitor, told Bloomberg. “This will include moving many aspects online, where personal engagement is still possible without physical proximity.”
Barry sees no scenario in which U.S. food-service coffee consumption returns to its former growth trajectory — though it’ll remain a core part of the industry.
This is not a surprise.
The morning commute came to an abrupt halt when people started to work from home. And working on a project from a charming coffee shop table or meeting with friends is less appealing with the presence of a virus that is transmitted by air.
For The Rose, the best environment to reopen probably won’t exist until at least spring of 2021, said O’Brien. “I feel like our biggest disadvantage was our greatest advantage when we’re not in COVID.”
Before March’s lockdown, brick and mortar cafes attracted travelers and conventiongoers, she said. But in 2020, drive-thru and pick-up windows are better models.
This gives a clear advantage to big coffee shop chains. But it doesn’t necessarily mean that national chains are thriving.
As of Oct. 15, Starbucks was one of the most vulnerable publicly traded restaurant companies in the U.S., according an October S&P analysis. The odds that it would default on its debts within a year landed the coffee giant in sixth place, behind Potbelly Corp., Noodles & Co. and Red Robin Gourmet Burgers.
A strong customer base is what has kept Salt Lake City’s Blue Copper coffee company afloat, said owner Patrick Andrews. Patrons go for the cold brew, prepared with the house-roasted coffee beans, even in the winter.
Sales of roasted coffee beans for home use have helped, Andrews said. The company sells 600 to 800 bags a month. It’s been such a success that they decided to offer free local delivery.
“It made me really rethink the way our website was laid out and some policies we had,” Andrews said. “We used to only ship coffee orders one day a week and now we’re doing it five days a week.”
The store at 179 W. 900 South has a great setup for social distancing, with a walk-up window and double doors that open to a patio. Still, Blue Copper had to furlough half of its staff.
Andrews said that even after adapting and taking actions like implementing an online ordering system — just like any other big corporate coffee shop — it won’t take them to pre-pandemic numbers.
Publik Coffee, with a concept that combines a menu of toast and local jams with small-batch roasting, has only been open for takeout, said owner Missy Greis. “The [virus] numbers are not under control.”
As soon as the shelter-in-place order was lifted, Publik opened its roastery. But almost none of its 40 wholesale accounts are operating. Offices and some restaurants are still closed, and even the Utah Jazz training facility, one of their clients, barely opens for business.
For Greis, an ideal scenario for their reopening with safety measures is Utah reaching a positivity rate of 5% or less on COVID-19 testing. On Thursday, the Utah Department of Health reported the weekly average is 18.1%.
“We feel really strongly about not encouraging people to come and gather,” she said, “and, unfortunately, Publik, the brand, the culture, and the model that we’ve built is all about gathering.”