Everything Else Small BusinessWritten by Dennis Hollier On 09 September 2010

It helps to know what your selling.

Thirty years ago, when I was still in school on the East Coast, a friend of mine, who had just inherited some money, invited me out for beer and peanuts and to talk about what he should do with his windfall. At the time, I had just finished reading a history of the restaurant and my advice was deeply colored by some surprising assertions in the book.

First, was the idea that something as inevitable as the restaurant needed inventing. And yet, the restaurant as we know it didn’t come into existence until the end of the 18th century, shortly after the French Revolution had turned Parisian life upside down. Prior to that, people mostly ate at home. When they ate out – while traveling, for example – it was generally at an inns or public house. You sat at a common table with the other travelers and ate what was served you ‘family style’. There were no private tables, and certainly no ordering off a menu. Indeed, according to this history, the most important innovation that restaurants offered was something the author called the ‘quasi-public space’, the opportunity to sit among a crowd, yet still apart, insulated from the other diners by a private table. It was as if a curtain separated you from the rest of the swarming petit bourgeoise, allowing you to see and be seen, and yet eat your meal or conduct your business with the illusion of privacy. People loved it.

This idea fascinated me, and I tried to convince my friend that what he needed to do with his money was to create a new version of this ‘quasi-public space,’ a place where people could gather, meet friends and socialize, if they wanted, but lapse into a good book if they preferred. In other words, create a space where people wanted to hang out and where they were willing to pay for the priviledge. The trick was to sell them something while they were there. “The idea’s not too different from this joint,” I said, gesturing at the seedy bar around us. “But people are tired of having to get drunk when they go out.”

“I suggest a coffee shop,” I said.

My friend, who had a good deal more business sense than me, was skeptical. He pulled out a pen, and in the margins of an old bar menu he did some quick calculations. “It would never work,” he said. “To make a profit, we would have to charge three dollars for a cup of coffee. For three dollars, Dunkin’ Donuts will give you a cup of coffee and a half dozen crullers. Hell, this bar charges 25 cents for a cup of coffee. And the peanuts are free.”

Of course, that sounded logical in 1980. But only because we didn’t fully grasp what was being sold. Today, though, I do almost all my interviews in the ‘quasi-public space’ of coffee shops. I favor independent shops, like Coffee Talk in Kaimuki, or The Coffee Connection in Haleiwa. But most of the time you can find me in the back room of the Starbucks on Merchant Street where the light is good, the music is turned down low enough for a conversation, and there are plenty of tables. And every time I’m there, I reflect on the thousands of similar Starbucks scattered around the world, and I think back to that conversation thirty years ago. Inevitably, I look down at my big, messy apple fritter and my grande iced latte and I say to myself, “What I would give for a three-dollar cup of coffee!”

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