Coffee Shop Owner: Getting Shut Down by V.A., Starbucks
By Gabrielle Karol
Published May 22, 2013
There’s a coffee war brewing inside America’s V.A. Medical Centers that threatens to oust long-established mom-and-pop businesses in favor of a Starbucks-affiliated chain.
At stake is more than a cup-o’-Joe — for a lot of vendors, it’s their livelihood.
Ken Gilmore, who owns and operates Epiphany Coffee and Tea, which for 15 years has been serving up coffee and snacks inside the V.A. Medical Center in Sacramento, California, says the government-run agency has not extended his contract, and instead will open a PatriotsBrew, a chain shop already operating in more than 115 V.A. Medical Centers.
Stacy Papachrisanthou, the director of marketing and communications for the Veterans Canteen Services (VCS), says the conversion of contractor-run coffee shops into PatriotBrews comes from the desire to offer veterans and their families “a more consistent assortment” of healthier snacks and beverages, including Starbucks brand coffees.
Over the past five years, the PatriotBrew initiative has converted 30 coffee shop contractors to PatriotBrews. Papachrisanthou says when the vendors’ contracts are up, they’re given notice that their shops will change over to VCS management. At that point, owners and their employees are offered the opportunity to become employees of PatriotBrew.
That’s one offer Gilmore says he can refuse.
Gilmore says he currently makes $3,300 a month running Epiphany Coffee and Tea – and the salary at PatriotBrew would only be $15 an hour.
“I’m the sole supporter of my family – I can’t pay my mortgage on $15 an hour,” says Gilmore. Even though the position would come with the benefits given to federal employees, Gilmore says the switch still wouldn’t be worth it.
He adds he’s been trying to cut back on stress since having two heart attacks, but the idea of having to start over In 90 days has been weighing heavily on his mind.
Will Veterans Pay the Price?
Gilmore says he sees the decision to oust contractors as financially motivated, rather than stemming from the desire to provide vets with more healthy options.
He says he has a contact within the V.A. who told him, “If they run everything and have licensing with Starbucks, they end up potentially making more than just having a vendor run it. It’s my understanding that prices will be higher.”
While higher prices could be less affordable for veterans patronizing the V.A.’s coffee shops, more revenue for the V.A. could help provide better services to veterans.
Papachrisanthou says the difference in price from contractor to PatriotBrew depends on the prices set by individual vendors.
In the case of the Sacramento V.A., Gilmore’s hunch may be correct. He currently charges $1 for an 8 ounce cup of coffee, while Anthony Goolsby, the manager of the Los Angeles V.A. Medical Center’s PatriotBrew, says that the price for a cup of coffee starts at $2 and goes all the way up to $5 for something more elaborate, like a latte or a cappuccino.
“I’ve tried to keep prices lower for the veterans,” says Gilmore. “It’s an opportunity to give back to those who serve the country, and a lot of them are on fixed incomes and can’t afford a lot.
“I see the same people over the years, and I love hearing their stories.”