Kyle O’Malley had anticipated “a break-out year” for Kamiak Coffee Company. But, “by February that was questionable.” And, “March was a completely different business
environment.”
With wholesale accounts on hold and coffee shops closed due to lockdowns prompted by the onset of COVID-19, the owners of the young roastery had to quickly regroup. Similarly, Indaba Coffee, which has been steadily expanding throughout the last decade, was also confronting operating changes in the face of the novel coronavirus. Both businesses successfully enacted measures to help them survive the pandemic, which—O’Malley says—forced them “to adapt or cease to exist.”
O’Malley (’17 Fin., Busi.) and Grant Schoenlein (’16 Fin.) left their jobs in 2018 to start Kamiak, specializing in premium, small-batch, roast-to-order coffee in Moscow, Idaho. The two had met at WSU, became friends, and were roommates during their sophomore year. O’Malley participated in the Center for Entrepreneurial Studies Business Plan Competition, which got him thinking about working in coffee.
Bobby Enslow (’06 Fin., ’08 MBA) established Indaba in Spokane in 2009. The business now includes five cafés and a roasting operation. Indaba is a Zulu term that refers to a gathering of tribal leaders to discuss important business. While studying for his MBA, Enslow spent two months in South Africa as an administration consultant for an HIV/AIDS clinic. When he returned to work on marketing development for a nonprofit, he recognized the need for a coffee shop in his hometown’s West Central neighborhood. With help from his family investing in the business, he purchased his first roaster and “jumped in with both feet.”
Enslow founded Indaba as a “third place,” or hub where people spend their time outside of home and work to hang out, build relationships, and exchange ideas. To that end, none of Indaba’s five locations are equipped with a drive-thru. When the pandemic hit, Enslow had to switch the service in his coffee shops to take-out only.
He went beyond state guidelines and stopped taking cash or letting customers come inside. Indaba already had a mobile app in place for ordering coffee for curbside pickup. But, according to Enslow, the app improved during the early months of quarantining, adding a feature to alert baristas when a customer arrived out front—including a vehicle description.
In March and April, sales were down 60 to 70 percent, Enslow says, though those numbers started improving during the summer. Also, for the first time early on in the pandemic, he submitted beans to Coffee Review, the world’s most widely read coffee-buying guide with as many as a million readers per year.
“We hoped for scores in the upper 80s and instead received a 94 and a 93,” Enslow says. From 40 samples, Coffee Review’s tasting panel gave Indaba’s Ethiopia Hassen Ware Akrabi the second-highest rating in the Northwest for its April 2020 tasting report, describing the coffee as “delicate, sweetly tart, intricately balanced.” These positive reviews in part led to a doubling of online subscriptions for weekly or monthly delivery of coffee beans, including subscribers from as far away as Boston. Enslow has since secured a warehouse and is working to build up the e-commerce side of his business. He’s also submitted more samples to Coffee Review, earning a score of 95 in August for Indaba’s Ethiopia Dame Dabaye which reviewers called “exquisitely balanced.” Two other coffees received scores of 91 and 93.
While Indaba was founded as a gathering place, O’Malley and Schoenlein established Kamiak as a wholesale roasting operation. The pandemic initially upended that plan, prompting the partners to focus on online business. They offered a sampler of their coffees as a way for their customers to try their products and determine their favorites. With improvements in online ordering and expedited shipping, they can now roast coffee on a Monday and have it delivered “hyper-fresh” to a client in Florida by Wednesday, Schoenlein says.
Both Kamiak and Indaba import raw green coffee beans ethically sourced from farmers who implement environmentally responsible coffee growing practices. The beans both roasters import are specialty grade, and certified fair trade, meaning buyers pay well above commodity price for the beans they import. There is a humanitarian aspect to sourcing coffee. The coffee growing belt along the equator includes many regions challenged by a lack of employment opportunities, poor health care, and the availability of clean water.
Coffee farmers, O’Malley says, need to earn roughly $2.50 per pound to break even, but world commodity prices are currently around $1.29. As a specialty roaster, Kamiak can pay a premium price, several hundred percent over base commodity prices, to obtain the highest quality beans and support growers who are doing innovative farming practices. These growers include Coopedota, a cooperative of small coffee famers in Costa Rica. Coopedota’s farmers compost their coffee cherry pulp, irrigate cattle pastures with wastewater, and maintain primary and secondary forests on their lands.
O’Malley observes that coffee—especially high-quality coffee—is an affordable luxury. During this pandemic, he says, “people at home need coffee to get through the morning Zoom meetings.” Both he and Schoenlein see a future in coffee similar to what has happened in craft beer, with consumers paying more attention to flavor and being willing to try new things. Quarantine, says O’Malley, “is an opportunity to learn new things.” He’s upped his cooking, and encourages people to “learn something new, become a professional home barista. Brewing coffee, enjoying a delicious cup is something anyone can do.”
Enslow has observed that, during this period of social isolation, small positive gestures—such as baristas engaging in brief, friendly exchanges with patrons—can be tremendously important. He also says he’s grateful for the community support he’s seen, along with his ability to obtain personal protective equipment for employees. “Our goal,” he says, “is to come out of the pandemic thriving, not surviving, and to remain a positive voice in community.”