Coffee Talk: A Husband/wife Team Succeeded In Creating A Growing Chain Of Neighborhood Coffeehouses With It's A Grind.

(Sunday, June 01, 2003) - Marty Cox and his wife Louise Montgomery loved "Hanging out" at their local coffeehouses in Long Beach, Calif., but thought that together, they could run a better one, especially when it came to service.

In 1994, the couple turned their "coffee talk" into a reality when they quit their corporate jobs to research and develop what would become It's A Grind Coffee House. Today, It's A Grind is considered the fastest-growing coffeehouse franchise in terms of number of franchises sold (142 since they began franchising in September of 2000), with 30 locations open in California, Arizona, Colorado, Nevada, Texas and Michigan, and it's quickly expanding.

The coffeehouse offers espresso and iced, blended coffee drinks, bagels, muffins, scones and other assorted bakery items. The company is Golden Cup-certified by the Specialty Coffee Association of America (SCAA), which is a certificate of brewing excellence. In addition, its coffee beans are grade-one standard, or the top five percent in the world.

Though coffee giant Starbucks is It's A Grind's main competitor, President Marty Cox says there's a world of difference between the two. "I think first and foremost, the way we differentiate ourselves is that we have the owner/operator in the store, [not a teenage manager]," Cox says. "The owner/operator takes ownership and has much more at stake."

He says It's A Grind is a happy medium between the large chains and the independent operators. "We have that good neighborhood feel of a small coffeehouse and the consistency and reliability of a chain," he says. "We fill the niche well".

As for potential franchisees, It's A Grind "looks to see if their values lean toward pleasing other people, " he says. "We believe it's important to treat everybody like they're the most important person. When people are able to do that, it carries though to their staff and ultimately to our customers."

Once franchisees are accepted and ready to open their store, they undergo 14 consecutive days of 12-hour training at the corporate offices and in actual stores. "They learn a lot in those 14 days," Cox claims. "Once their store is about to open, we send two trainers out to work in the store for the first 10 days to assist them in training their staff and to make sure the operation opens without any glitches. The staff must undergo six stages of training lasting several weeks."

The larger and more successful It's A Grind has grown, the more difficult it has become to run, according to Cox. A forward-thinking entrepreneur and conceptualist, he has surrounded himself with industry experts.

For example, he created a partnership with CEO Steven Shoeman early on, who he calls, "the driving force behind franchising," and shareholder/management advisor, Ernest Klinger, for president of Chicago Pizza Co., a publicly traded company. In addition, he brought Bob Phibbs, Director of Identity, who is responsible for marketing and promotions. Phibbs has also been a keynote speaker at the SCAA, an organization that sets the bar in the specialty coffee industry.

Cox calls the company's Director of Quality Assurance, Toby Foreman, "one of the top coffee guys in the country, who's also a speaker and trainer for the SCAA. The fact that two of our key people are trainers and keynote speakers for the SCAA speaks highly about us."

In the last year, It's A Grind has also added COO Dave Wetzel, former Vice President of Operations for Taco Bell and Koo Koo Roo. Director of Real Estate Carl Arena is former Vice President of real estate for Carl's Jr. "Part of how we're growing is by adding key people to help us with challenges," he says. "They've been instrumental in helping achieve our growth plans."

By adding a procurement specialist, David Ditzler, It's A Grind has been able to expand out of its California market and its distribution channel. In addition, the company is working to provide wireless access in all stores where available.

With the help of Aloha Technologies, the company's electronic gift cards can be purchased and used at any of the company owned or franchised locations.

The company plans on continued controlled growth west of the Mississippi, and Cox says the company will "probably continue to sell roughly 100 frachises a year and open about 50 per year. We don't want to get ahead of ourselves."

Though it's a long way from Long Beach, It's A Grind's Michigan-based prototype cafes have proven to exceed the company's expectations. Cox had only positive things to say after his recent visit. "Being in those store that far from home, it made me proud to see 50 to 70 people lined up there during the lunch rush," he says. "It was cool to see the success of our franchisee there and to see the concept we developed thriving so far from home."

Someday perhaps, people will have an "It's A Grind experience" in their own kitchens. Cox says the company is in negotiations about retail opportunities with a supermarket chain.

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