Diedrich Sells Out

Life is not fair. It is just not friggin fair. I just found out that Diedrich Coffee is selling 40 of its 47 company-owned stores. To Starbucks! First they buy Seattle’s Best Coffee, now Diedrich. It’s a cryin’ shame.

Starbucks plans to assimilate all the stores and regular employees. Managers will be invited to apply for assimilation. At least with SBC, the stores were left untouched. I’m guessing this is due in part to the fact that they’re both Seattle-based based companies, and the good, independent-minded people of Seattle wouldn’t stand for it (i.e., they’d be a slight public-relations nuissance). But more importantly, Starbucks bought the entire SBC corporation. In Diedrich’s case, they’re only buying (most of) the stores, so there will still be a few operated by Diedrich and franchisees.

But you’re totally screwed if you’re in California! Two car dealer coffee kiosks are all that’s left. I am not making that up.

Unfortunately, this was a rather simple decision for Diedrich. They have two main businesses: wholesale coffee sales, and coffee shops. The former is profitable, and the latter is not. They’ve been posting losses, mainly due to their coffee shops. Since they’re a public corporation, their duty is to maximize value to their shareholders. Ergo, they sold out like Metallica.

This hits me particularly hard because I’ve always harbored a fantasy that I might one day own my own coffee shop. If a major chain like Diedrich, which has both excellent coffee and pastries (surprisingly rare), can’t make it, what chance do I have? Granted, my shop would be modeled more closely to uber-cool independent shops like The Bourgeois Pig, albeit with a name you actually spell (probably). Now I’ll have to work extra hard at making it obscenely cool. This does not bode well for my lazy ass.