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Small Business Spotlight: Dogtown Coffee

Located near the border of eccentric beach towns Venice and Santa Monica, California, lies the world famous Zephyr surf shop, known for its role in the birth of skate and surf counterculture as well as for being the inspiration for the award-winning documentary, “Dogtown and Z-Boys.” The shop sat vacant until local surfer Assaf Raz was gifted a prime opportunity to take ownership of the historic storefront.

The preservation of history through localism

Through Dogtown Coffee, Raz and company sought to resurrect the storied legacy of the Zephyr brand and the “Dogtown” culture that embraced it. They hoped to re-immerse the community in the Dogtown lifestyle and in turn promote that lifestyle across the globe. While he chose to create a coffee shop, his true goal was to create a company that embodied Dogtown. In his words, “Coffee was just a vehicle.” 

Overcoming Startup Shortcomings 

Raz describes his decision to open up shop as a “vision,” one he embraced while afflicted with a “touch of madness.” And once he had made up his mind to make the purchase, he acted fast without doing much homework. 

It didn’t take long for Raz, whose only experience with coffee was working as a barista at Starbucks years ago, to find out just how tough starting up could be. 

It took a full year to get the business running relatively smoothly. This year involved researching and collaborating with vendors, creating a menu and learning the various roles within a coffee shop. His biggest struggles came with consistency and quality, and he looked to more established brands to help with those aspects. 

It all boils down to simplicity 

Because of Raz’s team and their strategies, Dogtown Coffee was successful, but any less-inclined entrepreneur without a solid startup plan would probably suffer a worse fate. It’s a testament to Dogtown Coffee’s resilience and business savvy, but it’s also a reminder of the due diligence that should be done before even considering starting up.

Research shows the startup costs of a coffee shop can range anywhere from $20,000 for a small coffee cart or kiosk, to upwards of $300,000 for a larger coffee bar. Raz quickly snatched up a great opportunity and didn’t have much time to think about it. But for others who don’t have the chance to buy an historic storefront, an investment of this size requires much planning. Once that plan’s in place, a lot can be learned from Raz’s local marketing and team-building strategies. 

Building a Foundation With the Community 

The Zephyr storefront was already a local pillar, and Raz and his partners set out to leverage that status to help his new business become part of the community as well. He sought to leverage the historical connection of his brand not specifically to drive revenue, but to make his brand a staple of the community, one that consumers would feel a part of and would feel like is part of the city. 

This should be the first step for all new businesses, especially retail shops: get the community behind you. No matter how grand your ambitions are, every business scales in steps, and the one of the few steps you should master is your local marketing. Marketers are constantly worrying about the bottom line, and for good reason, but many forget how important grassroots programs and a loyal customer base can be for the business. Charity and volunteering may not directly drive revenue, but as Dogtown Coffee shows, this sort of community engagement is essential for getting off to a good start. 

Creating a Loyal and Enthusiastic Team 

Without a solid understanding of any type of retail, including coffee, the first step for Raz and his partners was to learn the trade. When the shop first opened, Raz played the role of barista (and everything else, for that matter), and once he and his team had mastered each role, he hired someone to fill the position. This tiered training and hiring system continued until he understood and hired for every facet of the business. 

In this way, Raz doesn’t have to ask his staff for something that can’t be done or something he can’t do himself. This idea is from a lesson taught by Raz’s father: “Do all the dirty work in the world, so when you become an employer, you would know how they feel.” But Raz’s focus went beyond having experience in the jobs of his employees; he also wanted to make his employees’ experience an exceptional one they can depend on. 

Love the customer, but the labor comes first 

Raz’s commitment to the team is exemplified in his mission to provide his staff with a stable and valuable work experience. Dogtown Coffee offers benefits and compensation packages that go beyond the standard for small food retailers. They offer full-time employment to all staff members, as well as full health benefits that are 100% funded by Dogtown Coffee.

As Raz says, his hope is to provide both physical and financial wellbeing to his workforce, and this hope is apparent in his team of happy, healthy and well-compensated staffers. In return, Raz reaps the rewards of a team that believes in his mission and is committed to helping the business grow

Any entrepreneur worth his or her salt will tell you the success of their business lies in the abilities of their team. And Dogtown Coffee’s story tells us how important it is to develop a culture of mutual respect and empathy, as well as the necessity to favor cultural fit over skills. Remember, as Raz and his partners found out, learning skills is simple, but being a team player is even more important. 

Thinking Beyond Starting Up 

While Dogtown Coffee is now a part of Southern California beach life, Raz’s plans go well beyond his local community. Coffee was simply a springboard to become entrenched in the local culture, and now armed with a solid workforce and community support, Raz is hoping to propel his Dogtown brand into the retail and fashion sector.

From the start, Raz had planned this pivot. And many huge companies started their lives with a focus on something they didn’t become famous for, such as Nintendo starting out as a playing-card manufacturer, and Nokia starting out as a paper mill. But very few go into business anticipating a pivot. 

To accomplish this ambitious shift, Raz sought the help of mentors familiar with the industry, the community and, more importantly, the culture. None of these mentors were as important as local surfing and skateboarding legend Tony Alva.  

Alva was an original “Z-Boy,” a member of the Venice skate team sponsored by Zephyr, the brand that originated out of the Dogtown Coffee storefront. Together they are creating a line of surfboards, launched under Raz’s new surf and skate brand, DTC. 

What transcends here is the culture 

DTC is Raz’s “baby.” While coffee was a way into the community, DTC is Raz’s way to bring the community and their way of life to the world stage. With the help of some influential figures, an eager community and committed employees (the foundation of every successful small business), his journey is likely to continue beyond his beachfront shop to cultures around the globe. 

The unusual path that Raz and his partners paved for the DTC brand serves as an inspirational reminder that new ways of thinking are paramount to entrepreneurship. But one thing is constant for anyone wanting to open a coffee shop: You need a great location, a great plan, great people and a great cup of coffee.

 

For those interested in learning more about starting a food service business, check out these helpful resources:

How to Start a Business: The Complete Guide

Starting a Business: The Great Big Checklist of Everything

How to Get Started in the Food and Restaurant Business

How to Write a Restaurant Business Plan

Licenses and Permits Typical to Food Businesses

How to Engage Customers Through Your Yelp Profile

Promotional Ideas to Give Your Restaurant a Boost

Food Handling and Safety Laws Every Restaurant Needs to Know

  

Article by Nicklas Prieto

 
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