Much Ado About Mocha

Its chance for national greatness long gone, Arabica now must defend its home turf.

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"Phoenix is what Arabica used to be," says Carl Jones, the man who - founded both. - Walter  Novak
"Phoenix is what Arabica used to be," says Carl Jones, the man who founded both.
The two shops began in the '70s, in places far from hip -- one in rainy Seattle and the other on the East Side of Cleveland. Seattle's began because its founders tired of coffee from a can and wanted real beans. Cleveland's, in a converted garage off Coventry Road, was inspired by an adage recent Ohio State graduate Carl Jones had read: "If a man can make a good cup of coffee, he can do anything." The two cities' first designer coffeehouses were born.

Both businesses flourished in the 1980s, spawning imitators and expansions. By the middle of the decade, each had changed hands, added new stores, and prepared for regional expansion.

But then came a fork in the road. The companies' histories would never again run parallel; in fact, today, their similar beginnings seem unfathomable. Seattle has become trendy, and Starbucks, with 4,548 locations worldwide, is everywhere. Cleveland's original coffeeshop, Arabica, never moved beyond Northeast Ohio.

Worse, thanks to competition from Starbucks itself, Arabica has downsized, closing some stores and moving others to smaller spaces. Today, Greater Cleveland has more Starbucks (27) than Arabicas (25).

For Jones, the saddest part is what might have been. "We could have been Starbucks." Arabica's profits multiplied throughout the late '70s and early '80s. With money to expand earlier, Jones thinks his creation could have been huge. But local banks were preoccupied with traditional industries, he says. "We were in a position to offer what we did to the world. We had the opportunity, and we lost it."

Instead, Jones ended up broke and living in a tent, subsisting on Ritz crackers and peanut butter. He has now found success with his second coffee company, Phoenix, which has grown to six stores. "Phoenix is what Arabica used to be," he says.

After Jones's departure, Arabica enjoyed some success. The new owners quickly added more shops, and in 1994, they brought in Independence-based Restaurant Developers Corporation to handle franchising for others. "Those were great days," says Ron Wolfe, the franchise company's president and CEO. "We used to say, 'You could open a store, do nothing, and it would still succeed.' That's how easy it was."

Times have changed. National companies Starbucks and Caribou Coffee arrived in 1997 and immediately squeezed Arabica's territory, often by opening their stores within a few blocks of Arabica strongholds. "You have the same size pie, and you're cutting it up into smaller and smaller pieces," Wolfe says. "Someone has to lose." Five Arabicas -- Brecksville, Hudson, Shaker Square, the Avon Lake library, and Cleveland Heights -- closed. The Lakewood Arabica moved to a smaller storefront.

The Coventry Road Arabica was the most recent to close. The Starbucks on Fairmount Boulevard, with its more accessible parking, lured customers, as did a shiny new Caribou a few feet away. A promised remodeling never materialized, and rude workers did nothing to retain the customers who were left. "Business really slowed down, especially on the weekends, once there was competition," says Charlie Mosbrook, a folk singer who ran open mic nights at the shop for 12 years. "There used to be a line out the door. But once people had a choice, they went somewhere else."

The company's years of success as the only game in town may have led to laziness. A 1992 Plain Dealer review noted that some stores had difficulty keeping up with dirty coffee cups. Some customers complain about coffee that veers from excellent to burnt, depending on the day and the store. "If I'm going to pay $3.20 for a drink, I want it done right," says Lakewood resident Chelsea Mills.

Erin Reiffer, a law student at Case Western Reserve, used to frequent Arabica. Now she goes to Starbucks. "The only reason I'd even go to Arabica is if Starbucks was closed," she says. "Even then, I might go to Caribou." The reason? Arabica's products simply aren't as fresh, she says.

Even longtime Arabica supporters have noticed problems. Cleveland native Brian Friedman prefers hometown Arabica to the "anti-American Star-sucks," but he can understand why others don't feel the same way. Unlike the snazzy neighborhood coffeehouses in Columbus, Arabica looks noticeably second-rate, Friedman says. "You know it's a local place."

Cleveland Heights resident Kate Windle was sorry to see the Coventry Arabica go. She has long preferred Arabica to other coffeehouses -- mostly, she says, because it's local. But Windle isn't complaining about the coffee she now gets from Starbucks. "I can see why people prefer it," she admits. "The quality is great, and they really go out of their way to help you."

Wolfe thinks Arabica can rebound. The company has scrapped plans for more full-sized shops, opting instead for kiosks in well-traveled spots like the Rock and Roll Hall of Fame and City Hall. If Arabica eventually opens full-service stores, they will be smaller. Huge spaces like Coventry may be good for lingering, Wolfe says, but they are too expensive for today's supercompetitive market.

In fact, Arabica's biggest expansion now comes inside Convenient Food Mart, with the brew for sale "to go" as an alternative to plain old coffee. The company has stations in 35 Convenient stores; by December 2002, the number should rise to 100.

The deal did raise some controversy. Edward Frygier, who owns about half of Arabica's branches and a share in the franchising arm, filed suit against Wolfe's company to stop the sales. Frygier claimed that the "Arabica Express" stations sold watered-down coffee and gave Arabica shops a bad name. The partners settled out of court in May, and Wolfe says the Convenient sales are on. Frygier did not return repeated calls for comment.

And so, after five store closings, Arabica's dreams of Starbucks-size greatness appear to be over. But the company doesn't plan to give up Cleveland without a fight. "With the market the way it is, it requires a lot more strategy, for real estate and for marketing," Wolfe says. "You can't just let it happen. You have to plan. And that's what we're doing."

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