Can a Coffee Shop Thrive in the Midway?

As a result of a recent post about investors looking at opening a gourmet coffee shop in the Midway district a question that I have pondered is the competitiveness of this new shop compared to Starbucks. Will enough morning coffee drinkers choose a new shop on the way to work over Starbucks?

Here is a recent article I ran across about the competitiveness of small local coffee shops that compete head to head (in many cases right next door to) a Starbucks. There doesn’t appear to be a lot of real research, mostly anecdotal evidence that they can in fact thrive. The article mentions various reasons including the anti-big corporate crowd but there were two reasons I found particularly interesting.

1. The lines were too long and / or prices too high for many consumers. This one is interesting because as anyone who has visited our Fort Thomas Starbucks between 6:30 and 8 am will know there can be long lines from time to time. So long in fact that I have gone in and turned right back around and left at a rate of about once per month. One of the baristas told me once that this store is, if not the most, one of the busiest stores in the entire Cincinnati metro area from a revenue stand point. There are some interesting quotes in the article from an executive at Seattle’s Best, a chain of coffee stores mostly on the west coast.
2. Starbucks tends to create more caffeine addicts and creates a bigger “pie” rather than monopolizes the current size of the market in a given geography. I think the same can be true for Fort Thomas. Ciani’s did a great business on Fort Thomas Avenue with a closer location than the Midway has.

I think the net effect is that the Fort Thomas market can take another coffee shop and judging by the response to the survey on this blog so far it is the over-whelming favorite to add to the retail scene.

Also, I am posting a link from another Cincinnati area blog that recently profiled a new coffee shop in Covington that my wife and I visited a few weeks ago – Pike Street Press. It has a great atmosphere and should be a great place to pick up some ideas for a new coffee shop in the Midway.