Hot Coffee Takes: Buying and Selling Edition

People did a lot of crappy things with money this week!

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Welcome back to Hot Coffee Takes, the semi-regular column with bite-sized news updates about coffee, labor, and the hospitality industry. (See our last Hot Coffee Takes on Labor here.) 

I wasn’t 100% sure what to call this issue, but a lot of not cool things happened this week involving businesses making purchases and selling interests in subsidiaries. Let’s chat about it: 

Fair Trade USA Will Not Raise the Price of Coffee

There’s a lot to this story, including understanding the difference between Fairtrade International and Fair Trade USA (my colleague at Fresh Cup, Fionn Pooler, does a great job of breaking down this story on his newsletter), but the abbreviated version is this: Fairtrade International raised its minimum prices for coffee a few weeks ago, but Fair Trade USA declined to follow suit.  

Coffee labeled “Fair Trade” (whether with the Fairtrade International or Fair Trade USA label) generally implies that it falls under a certain set of parameters. Price is a vital differentiator: The farmers growing coffees under these labels are usually given more money than the current commodity market, or C-market, price. In April, Fairtrade International announced it would increase its minimums: Arabica coffee would go up to $1.80/lb and robusta to $1.20. (It’s important to note that many specialty roasters pay more than these minimums—albeit most still not enough to fairly compensate farmers’ labor and costs.) That’s why Fair Trade can be tricky to talk about: Yes, specialty pays more, but at the cost of singling out farmers and putting undue importance on “quality,” a theme author and academic Ted Fischer explained on a past episode of the show. 

In the past, Fair Trade USA has used the same pricing benchmark as Fairtrade International, but Fair Trade USA’s founder and CEO, Paul Rice, explained why his organization would not in an interview with Daily Coffee News: “If our goal is to increase farmer income, and we do that by raising price in such a way that we kill demand, then the impact will be negative ... And that’s what we were told very directly from the vast majority of the companies that we interviewed.”

In the announcement, the organization explained that the decision came after conducting a survey with over 500 Fair Trade stakeholders: “The major finding: the overwhelming majority of these companies warned that an increase in price in the current inflationary environment would significantly lower demand and volume over the next 12-24 months, reducing overall producer impact. While many producer leaders interviewed supported the price increase in principle, they also expressed concerns about the magnitude of the increase, the timeline for implementation and the risk of reduced market demand.” 

I mean, ugh. Basically, one of the most powerful organizations that could influence not just the price of coffee, but the cultural attitudes toward pricing and fair wages, decided to cave to business demands and, I’d argue, go against its purported mission. Furthermore, specialty coffee has repeatedly proven that people are willing to pay more for coffee—sure, specialty coffee exists as a “premium” market, but this justification feels weak and gross. Coffee is already deeply undervalued, and not adjusting for factors like inflation and the rising cost of doing business feels antithetical to the point of the Fair Trade model. 

Revelator Coffee Went From Buying Up Southern Coffee Brands to Losing All But Two Locations

In June, workers at a Revelator coffee shop in Birmingham made righteous news waves when they took over their store to host a metal concert benefit after finding out it would be closing. “Employees of downtown Birmingham’s Revelator Coffee rebelled against the company by holding a live music show inside the store,” AL.com reports. “The popular coffee shop closed over the weekend without notice to employees or patrons.” The show raised money for the workers who lost their jobs overnight. 

Workers taking over the location and saying “fuck you” to ownership is objectively awesome, but I want to focus on the trajectory of Revelator, a brand that at one point operated more than 20 stores all across the southern United States. Again, my colleague, Fionn Pooler, wrote about the concert and pointed to a 2017 Eater article where the brand was slated to become the next “Blue Bottle,” ostensibly through major investment and by acquiring pre-existing brands. “In October 2014, a sleek, stripped-down coffee shop called Revelator appeared in Birmingham, Alabama,” Eater reports. “A year later, four more Revelator shops were up and running in New Orleans, Atlanta, Nashville, and Chattanooga, Tennessee. By November of 2016, Revelator was running eight coffee bars across the Southeast.” 

In 2017, Revelator acquired Octane Coffee, an Atlanta-based mini-chain with six locations, and seemingly topped out at around 20 locations across the South (plus a few more in Massachusetts, inexplicably). But then a tale as old as time began unfolding. 

Within less than 10 years, Revelator opened, got a ton of investment, acquired enough locations to count on all your fingers and toes—and then essentially shut them all down. Six Octane locations, which took the original owners 13 years to open, lasted just three years under Revelator’s ownership, with some closing long before the pandemic. Stories like this make me ask: What was the point in spending all that money and acquiring brands, only to close them down within a few years?

San Francisco’s Anchor Brewing Is Closing

Speaking of buying up businesses only to drive them into the ground…

Anchor Brewing, founded in 1896, is one of America’s oldest breweries. It has survived the 1906 Great San Francisco Earthquake and the 1989 Loma Prieta earthquake, and people from the Beat Generation were just as likely to drink the brand’s signature beer, Anchor Steam, in the 1950s as were the tech bros who invaded the city during the 2000s. But just six years after being purchased by Sapporo, the business announced it was shutting down for good. 

My buddy Dave Infante has covered Anchor’s closure extensively, both on his amazing newsletter Fingers (where he gives a great overview of the brewery’s history) and for VinePair. The brand blames declining sales and pandemic-related issues for the closure, but Dave rightly points out some of the missteps the parent company made in managing its new asset, like a union-busting campaign in 2019 and an unsuccessful rebrand in 2021. 

There’s certainly more to this story, and I expect additional details to come out soon. “In the meantime,” Dave writes, “I’d encourage you to be wary of insistence that Anchor was doomed before Sapporo USA took over, or that workers’ 2019 decision to unionize precipitated this, when in reality it’s probably the only thing ensuring many of them a dignified severance ... And above any of that, remember this: Anchor survived everything — fires, depressions, recessions, everything — for nearly a century and a half before Sapporo USA came along and drove it into “dire distress” in less than half a dozen years. The company says it did everything it could; workers say it did too much, when it wasn’t doing enough.” 

Writers and Actors Are on Strike at the Same Time! But Why Are People Writing Gross Articles? 

I assume most Boss Barista readers will be  at least loosely aware of the ongoing Writers Guild of America strike in Hollywood. They’ll likely also know that SAG/AFTRA, the union representing actors, has recently joined the strike. 

But they may not know that, an anonymous studio executive—quoted in this Deadline article, potentially as part of an intentional leak—revealed their long game was waiting out the strikes until writers were destitute: “The endgame is to allow things to drag on until union members start losing their apartments and losing their houses,” a studio executive told Deadline. Acknowledging the cold-as-ice approach, several other sources reiterated the statement.

Like, who the fuck printed this? As I mentioned above, many of the folks I follow on Twitter implied that this was part of an intentional leak to scare writers, especially since the article came out ahead of the SAG/AFTRA vote to join the strike. Many writers affirmed their solidarity and were undeterred by the comments—but did rightly question how the media is covering the strike, and how power and influence dictate what readers learn. 

I think this goes back to something Dave Infante said re: Anchor Brewing’s closure. It’s easy to accept the company line as true, especially when it’s been regurgitated by one or many media outlets, and it’s disappointing when reporters don’t push people in power to justify their stances. You see this in this interview with Bob Iger, the CEO of Disney.

Mind you, he said this in Sun Valley, Idaho, which regularly plays host to a “billionaire summer camp.” But in this clip, it seems like the reporter—who, to their credit, did try to follow up with Iger after he called the demands of writers unreasonable and dangerous—still doesn’t go much further after Iger gives him a nonsensical answer. 

I think the lesson in all these stories is that money—large amounts of money—corrupts your brain in a way that’s both all-consuming and inexcusable. Growth that looks like buying dozens of stores quickly or leveraging goodwill to make morally bankrupt decisions isn’t worth pursuing. Now more than ever, we’re at an inflection point where workers are going toe-to-toe with moneyed interests. I can only hope workers remain strong and prevail. 

Condemning Collective Action, and Then Asking for Money Through Crowdfunding 

I don’t have much to say about this story since the main character, Raffi Sulahian, does all the work for me. 

Sulahian bought all the coffee equipment from the recently shuttered Little Dog Coffee Shop in Brunswick, Maine. The cafe closed as workers were organizing, and on May 27, Sulahian wrote a letter to the editor of the Portland Press Herald (under the name Christopher Morgan, his middle names) condemning the actions of the organizing workers: “The recent strike against Little Dog Coffee Shop in Brunswick is indicative of so much that’s wrong with this country at the moment. These employees don’t understand the history of labor unions and are making a mockery of the concept,” Sulahian writes. Here’s another gem: “Whoever owns this business may be guilty of careless management for other reasons, but it doesn’t sound like it.” He cites no evidence for this conclusion. 

Then Sulahian decides to start a GoFundMe to raise money to reopen the cafe—which is wild. People called out the audacity of using a crowdfunding platform to open a for-profit business (which is relatively commonplace these days). What really angers me is that Sulahian condemns collective action (at least the collective action of the baristas—he seems to understand the importance of unionizing, but sees it as only appropriate for large corporations) and then uses a platform to raise money that relies on the kindness and collective goodwill of others. 

I thought I was just going to point out this bizarre discrepancy, but as I read more reporting on Sulahian’s actions, things kept getting weirder—the ongoing saga is what local newspaper reporting was made for. He’s since paused the GoFundMe campaign (reading his explanation as to why is its own delight); a local politician called out his anti-union sentiments (on a Facebook forum, no less, filled with missives from residents that remind me civic pride and local community are not dead); and the Portland Press Herald has uncovered Sulahian’s long and bumpy history of business ownership. 

Did you read anything weird, wild, and/or noteworthy involving money, coffee, or service work recently? If so, drop your links below—and I hope you enjoyed this edition of Hot Coffee Takes!