A business model that’s now an obvious moneymaker wasn’t so easy for Don and Linda Eckles to pitch in the 1990s.
The couple behind what would become Scooter’s Coffee had returned to their Nebraska roots from Sacramento, California, where they had started in the coffee business.
“We saw a guy building a little drive-thru coffee hut, and I stopped to talk to him. I went back and told Linda, this guy is on to something: drive-thru coffee,” Don Eckles said.
Turns out, they were on to something. What started as a mom-and-pop coffee shop has grown to a franchise business with more than 120 stores in nine states, including Texas, California, Kansas and Colorado. About 40 more are slated to open by the end of this year in markets such as Atlanta, Phoenix, San Antonio and Minneapolis.
Last week, the Omaha-based coffee chain purchased four shops out of bankruptcy in the San Francisco Bay Area Rapid Transit System, to be converted to Scooter’s stores by the end of this month.
At first, though, property owners in Omaha weren’t convinced.
“You have to imagine, in 1997, talking to landlords in Omaha about building in their parking lot and selling $3 cups of coffee,” Don Eckles said. “They look at you like you’re a man from Mars.”
But they found one who would bite at Cornhusker Plaza near 24th Street and Cornhusker Road in Bellevue, where the first Scooter’s — a reference to a childhood nickname for one of the couple’s daughters — opened in 1998.
“Linda was in the window mostly. We were the only two employees. That’s just the way it was,” Don Eckles said.
With the rapid growth over the past few years, Scooter’s is now bursting at the seams of its headquarters, which includes a roasting facility, bakery and warehouse at 6824 J St. In April, the company closed on a $1.2 million purchase of just over seven acres of land to the north of the current headquarters, allowing Scooter’s to grow in phases over the next several years.
“It’s really fortunate for us. We had looked for warehouse and space and there just really wasn’t anything for sale around 100,000 square feet, which is what we were looking for. Then the land behind us was for sale. It just worked out perfect,” said Clay Cox, who was promoted recently from chief operations officer to president of Scooter’s Coffee. Don Eckles remains on staff as CEO and co-founder.
The expansion will be built in phases. Dirt work will begin this summer, with construction expected to begin early next year on a 30,000-square-foot addition to the company’s existing 47,000 square feet of space. Some staff members occupy leased offices at 72nd and Pacific Streets in the meantime, Cox said.
The first addition, expected to be completed by the end of 2016, will triple the size of the company’s bakery and double the size of its roasting facility. The rest of the addition will be used for distribution and some offices.
The second phase, to begin in early 2017 and be completed by the end of that year, will add more corporate offices, most likely a separate building that will be a short walking distance from the existing distribution facility.
“We could put probably four of our (existing) buildings on that parcel now. It gives us a lot of room for growth for quite a few years,” Cox said.
The third phase would add warehouse and roasting space as needed. “The first two phases will get us out for three or four years, then we’ll plan on the final stage sometime after that,” Cox said.
When done, the facility should be around 150,000 to 200,000 square feet. The company also has an approximately 10,000-square-foot distribution facility in Independence, Missouri, that is expected to double in size by the end of the year. Eckles said regional distribution centers will be the model going forward as more stores are added in different parts of the country.
With a staff of about 60, relocating the headquarters to another city was out of the question, Eckles said.
“We are Omaha people. Omaha is just a great business community. We love being here,” Eckles said. “I grew up in Omaha and Linda grew up in Culbertson, so we’re Nebraska kids.”
Growth is targeted from Omaha out, Eckles said. The company is looking at markets like Oklahoma, Wyoming, Iowa and smaller markets in Nebraska, such as Beatrice, Columbus, Scottsbluff and North Platte.
That’s not to say other areas aren’t possible, if the right franchisee was interested in signing on. “We just want to go in a place where we can build eight or 10 stores right off the bat and establish a bit of a brand presence,” Eckles said.
That’s part of the strategy to compete with large chains like Starbucks and Caribou Coffee. The goal is to go to areas of towns where they aren’t, Eckles said.
In a lot of other markets, such as Dallas, there is no large local coffee chain, so Scooter’s competes with national brands and several local establishments.
“What you get in the coffee business, because it’s such a strong, local, loyalty-based business, you go in and everybody around you is going to give you a try once. That’s kind of the way we attack those markets. The smaller communities, word just spreads quickly that a new coffee place is in town, and you either do well or you don’t, depending on how well you do your homework,” he said.
Scooter’s has also brought on several industry veterans, including Kelli Steidle, a former brand manager at ConAgra Foods, who was hired as vice president of operations, and Rob Streett, brought on as senior vice president, who has 20 years of experience with coffee and franchising at Starbucks, Coldstone Creamery and TCBY.
Stores are currently testing breakfast sandwiches and iced tea, both of which should launch this year.
Despite the national presence, the company maintains its family-run feel.
The Eckleses’ two daughters work at the headquarters, along with their husbands and a grandson. Don Eckles’ mom works with Linda, flavoring each batch of coffee.
The happy face stickers that Linda Eckles began buying at Walmart to put on cups remain, and are now trademarked. When they were absent for a period, customers noticed.
“We got emails and calls and (customers) said, ‘I don’t know why I like those dumb things but I like them,’ ” Don Eckles said.
Added Linda: “It’s like putting sprinkles on your cupcake.”
The idea is to send customers off with a smile.
“In the coffee business we try to remember we’re pretty lucky. People come to us because they want to,” Don Eckles said. “We just want them to know we don’t take that for granted, we’re glad they’re there. So, it’s just those little things.”
Contact the writer: 402-444-1304; firstname.lastname@example.org