How One Business Fights the Downturn

Many small-business people are worried about a possible recession. But for some, a weak economy isn't a fear looming on the horizon—it's a way of life. Take Sarah Wilson-Jones, CEO of Phoenix Coffee Co., which runs five stores in the Cleveland area. "In general, Cleveland is in the dumps already," Wilson-Jones says. "We've never had rollicking economic conditions here, so we're kind of just used to this kind of climate."

Sarah Wilson-Jones, CEO of Phoenix Coffee.

Not that she's complaining. In fact, Wilson-Jones is about to open a brand-new location in a couple of weeks, with another one following in the spring, even while other businesses are worried about whether they can maintain their current sizes.

Is it something in Cleveland's water—or coffee? And how can a small-business person be ready for any kind of economic situation? Wilson-Jones believes that a focus on employee education allows her to offer something unique to her customers, which makes her company able to flourish regardless of the state of the economy.

The people at Phoenix Coffee have definitely noticed the problems around them. Carl Jones, Wilson-Jones's husband and the founder of the company, says he sees economic pain through all the people who walk into his store. "We're in touch with thousands of people every day because of the nature of our business," Jones says. "The environment here in Cleveland is difficult at best. Here the price of houses is stagnant and falling."

But the past few months have been business as usual for Phoenix Coffee, for the most part. The couple says sales are good and cash flow is normal.

What's the secret? Wilson-Jones says her goal is for her baristas to be not just anonymous faces behind a counter but full-fledged coffee and tea geeks. She wants them to be able to wow customers with inside-and-out knowledge of what they sell.

To that end, Phoenix Coffee is willing to make some investments. It sends employees to conferences to learn the tricks of the trade, and her employees often hold seminars for one another on specialized topics, such as what coffee grounds look like under a microscope.

The company also arranges international trips for employees to coffee-producing countries, like Costa Rica. "They realize it's not just a mom and pop store in Cleveland," Wilson-Jones says. "They're part of this worldwide community of coffee makers."

She thinks these investments pay off when a customer walks into the store and has not merely a drink but an experience. She recounts one story: "We had a customer come in who's a coffee drinker, and she wasn't feeling very well and said she might want some tea. One of my baristas said, 'I have just the tea for you.' She was able to suggest a tea that has this kind of smoky campfire quality, which is perfect for coffee drinkers, but it has the soothing qualities of tea."

Phoenix Coffee offers products and services specialized enough that the big boys like Starbucks don't bother it, Jones says. Just for fun, he took out a cheeky Phoenix Coffee ad in the Seattle newspaper The Stranger, in reaction to Starbucks's recent three-hour closing of all its stores. "Thank you Starbucks," the ad said in part. "Seriously...Thank you for taking the drastic step of closing your stores last week so all your Baristas could be retrained in the proper methods of creating drinks worthy of savoring. We at Phoenix applaud your dedication to ensuring that coffee lovers everywhere will not be disappointed."

An upbeat attitude like that can go far for small businesses facing a recession. Phoenix Coffee's strategy has been to ignore what's going on elsewhere and put out a recessionproof product. "The more you focus on what you have to be afraid of," Wilson-Jones says, "the harder it is to be successful and thrive."