20th and South: Cupcake Boutique

**ofeibush** · 10-10-2012, 10:55 AM

There are 50 businesses on South Street that you should visit. If you like Italian food, go to Roberto's Cafe. How about Quick Fixx? Pumpkin? Novita Bistro? La Va After Hours? Rex 1516?

I speak to the owners of many of these daily and they could all use more traffic.

**Spicoli** · 10-10-2012, 11:07 AM

Originally Posted by ofeibush

There are 50 businesses on South Street that you should visit. If you like Italian food, go to Roberto's Cafe. How about Quick Fixx? Pumpkin? Novita Bistro? La Va After Hours? Rex 1516?

I speak to the owners of many of these daily and they could all use more traffic.

I do get delivery often from Quick Fixx and Indian Restaurant. My go to place for pizza is Lazaros. I have been to Pumpkin and haven't really heard great things about Robertos. And though I spend more than enough money at Lava, I'll concede I haven't been to their "after hours". However, turning an ultra casual coffeeshop into an upper scale restaurant at night doesn't actually sound like the best business model.

How about South of South....that's what I'm most concerned about. Why can't anything else go on that corridor between Christian and South on 22nd?

Originally Posted by devilspocket

SOSNA didn't decide to 'skip' having a zoning meeting. The Zoning Committee does not meet in August. ZBA hearing notices were posted in the shop's windows, so anyone could have attended the hearing.

Not "anyone" can attend ZBA hearings. Those hearings are held in center city at times like 2pm. On the face of it, a cupcake/ice cream parlor sounds pretty harmless. I doubt anyone would take off work to go hear it. Taking an hour in the evening to walk couple blocks to see it at SOSNA is a different story. I also doubt anyone expected them to severly alter the exterior.

So I guess what you're saying is if anyone want to try and slip something by the neighborhood association, present it in August.

**ofeibush** · 10-10-2012, 11:14 AM

I am not attacking you. I am sure you go to plenty of these.

**Spicoli** · 10-10-2012, 12:51 PM

Originally Posted by ofeibush

I am not attacking you. I am sure you go to plenty of these.

Nah....I didn't take it as you attacking me. I wrote that up quick before leaving work....sorry if it came off that way.

I'm just a really frustrated property owner watching his neighborhood operating well below its potential. I mean...it doesn't need to become No Libs or KoP or anything. But that we can't get rid of drug trade and shootings is disappointing.

I think the good businesses will draw the foot traffic...not rely on it. I doubt Sidecar relies on people who just happen to pass by. And like I mentioned in another thread, Bibou isn't exactly in Society Hill either....yet you need reservations weeks or months in advance to get in.

And I hate to keep bringing it up, but Bedford and Tria would've most likely done extremely well if they were allowed to enter our neighborhood.

**sockii** · 10-12-2012, 12:26 PM

Originally Posted by Spicoli

haven't really heard great things about Robertos.

A pity, because Roberto's is actually one of my favorite non-fussy, non-fancy Italian restaurants in all of Philly. Being Italian (and visiting the "mother country" regularly), I have to say I find their food beautifully authentic and seriously comparable to what you'll get in a real Italian trattoria or osteria. It's not South Philly red gravy, but neither is it Marc Vetri. But do go there and try the Vitello Milanese and Grilled Smoked Mozzarella sometime.

**Lolly** · 10-12-2012, 12:52 PM

Originally Posted by sockii

A pity, because Roberto's is actually one of my favorite non-fussy, non-fancy Italian restaurants in all of Philly. Being Italian (and visiting the "mother country" regularly), I have to say I find their food beautifully authentic and seriously comparable to what you'll get in a real Italian trattoria or osteria. It's not South Philly red gravy, but neither is it Marc Vetri. But do go there and try the Vitello Milanese and Grilled Smoked Mozzarella sometime.

You are not the only one. Craig LaBan thinks so too...

Salento - Philly.com

"Of course, Rittenhouse happens to be one of the most densely trattorized neighborhoods in town, with Melograno, Caffe Casta Diva, Branzino, Porcini, Roberto Cafe, and Gioia Mia among the best."

**benfox** · 10-12-2012, 12:54 PM

I agree with your comments about Roberto's! I love that place. Get the branzino for two and you won't be sorry. Plus it's BYO.

Ben

**andrewd** · 10-12-2012, 04:14 PM

Originally Posted by sockii

A pity, because Roberto's is actually one of my favorite non-fussy, non-fancy Italian restaurants in all of Philly. Being Italian (and visiting the "mother country" regularly), I have to say I find their food beautifully authentic and seriously comparable to what you'll get in a real Italian trattoria or osteria. It's not South Philly red gravy, but neither is it Marc Vetri. But do go there and try the Vitello Milanese and Grilled Smoked Mozzarella sometime.

This. Roberto is excellent, the food, the service, the atmosphere. Best kept secret in Philadelphia.

**Lolly** · 10-12-2012, 04:55 PM

Originally Posted by ofeibush

I will be running and hiding after posting this......

Businesses do not open South of South because they generally don't get enough foot traffic. Our residents tend to go north to Center City for their shopping.

The whole 20th & Kater mess was embarrassing, but that is not the reason businesses avoid opening in our neighborhood. We have a healthy population with disposable income and just a few retail spaces...yet there is no wait or line at any of our establishments! Show businesses that you care and you will get more of them.

If you want businesses to open in our neighborhood you need to support them. And I don't mean once a month or on special occasions!

After spending yesterday all afternoon working from Ultimo, I don't think that's true at all. It was constantly packed from 2pm onwards.

That said, I imagine OCF Coffee in Point Breeze (for example) does suffer from this phenomenon unfortunately to an extent because of it's "deeper south" location. Still, I have every reason to believe that too will change, hopefully soon enough, and I will continue to do my part by going there to support that great local business regularly too.

**ofeibush** · 10-12-2012, 05:17 PM

There are a whole lot of variables that go into it but the rule of thumb is generally 200. Get there at 7AM or whenever they open and start counting every time a customer buys something. If you count to 200 they are making money. If less, uh oh. Not suggesting they should be profitable from day one but you need a customer every few minutes to break even in the coffee business.

Ori

**ofeibush** · 10-12-2012, 05:19 PM

Yeah Point Breeze sales are terrible. We always anticipated losing money but this is quite a bit worse than expected. We are averaging 40 tickets a day at 20th and Federal. For comparison purposes, 18th & South averages 250.

**bradley** · 10-14-2012, 12:24 PM

Originally Posted by ofeibush

Yeah Point Breeze sales are terrible. We always anticipated losing money but this is quite a bit worse than expected. We are averaging 40 tickets a day at 20th and Federal. For comparison purposes, 18th & South averages 250.

Thank you for sharing this rule of thumb. I find it amazing that any of the independent coffee shops outside of center city can make money. I would imagine that the rent-vs-traffic balance is very delicate for the coffee shops on the fringes. I'm sure it's a good thing that the coffee market around here is healthy; if you want a good cup, you don't have to walk to center city and pay $4.50 for a tasteless latte from Starbucks. That said, I second the idea that we will only get businesses that we want to pay for. Not to put too fine a point on it, but we're voting with our dollars. Given that the cupcake boutique is doing well, there must be a market for it.

If the margins are thin and traffic is low, do you plan to just wait for patrons to fill in eventually, or is the 20/Federal location worthwhile as a face for your other businesses? It seems like a lot of the good coffee in Philadelphia is either growing or part of some other business (e.g. Bodhi and Federal Donuts). I'd like to know whether coffee profitable on its own, or just tangent to more profitable business.

**ofeibush** · 10-14-2012, 02:57 PM

Coffee can be profitable on its own....just depends on location. Believe it or not, rent is not the driver. It's the cost of employees. You have to have staff and pay them well regardless of location. That's the real consideration.

Just breaking even is a disaster too. It costs $100,000 + to open the simplest coffee shop so without a healthy profit you just flushed $100,000 down the toilet.

I always anticipated losing money at 20th & Federal. I'm running a $4,000 / month loss right now....hoping to get that down to a $2,000 / month loss after the near year.

I never had a master plan over there...just knew that a coffee shop was pretty much the best use possible for the neighborhood (yes all members of the neighborhood). I've leased 2 other corners at 20th and Federal over the last few weeks so hopefully between 3 new businesses we'll be able to get some commercial traction in the neighborhood.

**John Goodman** · 10-14-2012, 06:21 PM

Interesting...

Makes me wonder how coffee shops that aren't run by real estate people stay in business... There's a couple in less busy parts of fishtown/Kensington that baffle me

**ofeibush** · 10-14-2012, 08:35 PM

If they are owner operated they may be working with different numbers. I wouldn't recommend a coffee shop in a fridge area to anyone as a source of revenue. Just like every business....location, location, location. If you are not in a high traffic location it's tough.

**ArcticSplash** · 10-14-2012, 10:43 PM

Originally Posted by John Goodman

Interesting...

Makes me wonder how coffee shops that aren't run by real estate people stay in business... There's a couple in less busy parts of fishtown/Kensington that baffle me

You talking about Leotah's at Coral and York? It actually gets quite a bit of business because for some East Kensington peeps, York-Dauphin is way more convenient than Berks, and Leotah's is just down the road from the station. It's also huge on the inside (go past the barista to the back).

Rocket Cat used to be considered a location that was a "Business Desert" but not anymore.

Coffee House Too (York and Belgrade) gets all its business from the residents who live next to it. Owner of the building is in default on mortgages and I think it's up for sale, but the tenant seems to be doing fine.

I'll be more impressed when I see people buying lattes under the EL. That's when you know the End of Days is near.

**bradley** · 10-14-2012, 10:52 PM

Originally Posted by ofeibush

If they are owner operated they may be working with different numbers. I wouldn't recommend a coffee shop in a fridge area to anyone as a source of revenue. Just like every business....location, location, location. If you are not in a high traffic location it's tough.

Thanks for the perspective. I have one more question. In many parts of the city, coffee is a commodity. You can get La Colombe, Starbucks, or DD at dozens of locations. Do you pay an extra margin for decent beans and baristas who know what they are doing? To me, this makes a big difference. I'm not trying to brown-nose here - I'm just interested in the economics. Even before the explosion of third-wave coffee shops in this neighborhood, I would gladly ride to a distant shop with good beans and a competent barista. Either the cost for the beans is low, or more people care about a good cup than I thought.

Incidentally, despite the fact that we have tons more coffee shops, I find it surprising that Philly can support so many cupcake places. Maybe it's less of a novelty than I thought.

**ofeibush** · 10-14-2012, 11:17 PM

Decent beans cost more. Everyone has different tastes so it's not linear in the sense that more expensive beans create a better cup of coffee. Generally speaking....yeah.

Good beans start in the mid-$7/pound. We pay roughly $9/pound for our Counter Culture beans and $8/pound for Green Street. Pour over and french press coffees also use more coffee per cup so that plays into the cost.

There are many training programs available for baristas. Many of our staff look at coffee as their career so they continue to develop their skill sets and rightfully expect to be compensated for their abilities.

So in short....there is a reason a cup of coffee costs more at Ultimo / OCF / La Colombe, etc.

**EJW** · 10-15-2012, 09:04 AM

This morning I passed by the shop and saw the Sheet Metal workers union protesting the Cupcake joint for apparently not hiring union labor. They looked like they were working hard.

**bradley** · 10-15-2012, 12:38 PM

Originally Posted by ofeibush

Decent beans cost more. Everyone has different tastes so it's not linear in the sense that more expensive beans create a better cup of coffee. Generally speaking....yeah.

Good beans start in the mid-$7/pound. We pay roughly $9/pound for our Counter Culture beans and $8/pound for Green Street. Pour over and french press coffees also use more coffee per cup so that plays into the cost.

There are many training programs available for baristas. Many of our staff look at coffee as their career so they continue to develop their skill sets and rightfully expect to be compensated for their abilities.

So in short....there is a reason a cup of coffee costs more at Ultimo / OCF / La Colombe, etc.

That's interesting; I had assumed that even the good beans were cheaper than that. Despite the slightly higher cost of a regular cup of coffee, it's good that the independent shops provide something different than the big chains, where you'll actually pay more for an espresso drink anyway. There's probably a decent analogy with development [starbucks = toll bros] in here somewhere. You probably have to clear some kind of strict threshold before you get a healthy market for whatever you're selling, whether it's cupcakes, coffee, or rowhomes.