New York City, Union Square; East West Living, one of Manhattan’s few holistic health supply and spiritual bookstores has made a move to downsize the expense of its café to increase revenue storewide and battle the effects of the economy.
“We are moving away from preparing our own food to reduce overhead costs” said Ronn Goodmen, East west’s IT Manger. Goodmen has been an employee for six months and oversees store operations. “It works out more cost effective to have the food prepared by an outside location than in the store,” Goodmen said. The transition from preparation-based-food made on the premises to snack food imported from other business has resulted in the lay-off of the chef and cut hours for the café’s four employees. The flow of customers was inconsistent, which meant that fully prepared food would often go to waste and extra employees would work shifts with little to no customer interaction, Goodmen explained.
East West Living has called Fifth Avenue home for over 25 years. The store closed its doors five years ago to remodel and obtain the proper documentation needed to run a kitchen. East West has always specialized in carrying spiritual, metaphysical and holistic health books and supplies, as well as been a place to sponsor events for the area’s yogic and spiritual community. The café portion of the business has been up and running for three years.
“In running any business the major challenges are with making sure your staff, clients and customers are happy. During this time in the economy its the struggle of balancing the two,” Khadijah Farmer, the Café Operations Manager said. Farmer, 30, a New York native has worked at East West Living as the Café Manager for the past three years. The main concern with the café in relation to the store as a whole was that the café wasn’t bringing in much of a profit. $1000 was being spent weekly to supply the café with the necessities to prepare a full selection of vegan and vegetarian meal options.
The New York Department of Labor on March 10, 2010 issued a press release that shows the unemployment rate in New York state is at it’s highest since 1992, having reached it’s peak (8.4%) in 2009. In Manhattan the unemployment rate (10.2%) is slightly higher than the state average (8.8%), but as a whole New York State is still below that national average (9.7%). New York Department of Labor Liberal Market Analyst, Jim Brown, explains that Manhattan is the place of Business Services mainly accountants, lawyers and consulting firms; the industry of Business Services has been hit hardest by the economy, which is why Manhattan has the highest unemployment rate in New York.
“Customers have been walking in for hot food and then walking away,” café employee Tyler St. Clair said. St. Clair, 19, has worked at the café since July. Since the new transition St. Clair’s hours have been cut and his tips have diminished. He says he thought about getting another job because the café is no longer financially supportive, but if he were to leave now the café would suffer immensely. “We don’t have the man power to train another person at this point, “ St. Clair said. St. Clair says he feels like the transition in the café has been a cause for lost business. “ I think it’s been a loss for the community,“ St. Clair said.
There are 249 bookstores in Manhattan, over 100 Starbucks and 43 Dunkin’ Doughnuts. “Being an independent coffee shop in Manhattan with the slugfest of Starbucks and Dukin’ Doughnuts is tough,” Market Analyst Jim Brown said. According to the Small Business Association small businesses pay 44% of the United States private payroll and have provided 64% of new jobs over the past 15 years.
East West brings in the majority (80%) of profit through the store portion of the business, with the café bringing in the remaining 20% of profits, Goodmen said. “One of the main reasons for the change is to focus more on a business-meeting cafe with evening events and not so much a food service cafe. We are always looking at the overall health of the whole business and making changes as we discover things that need improvement, “ Goodmen said.
“Restaurants are a tricky business because of service demands and restrictions and the trend for bookstores is tough with inventions like Kindle and books on the Internet,” Brown said. Despite the difficulty of the Business Services industry and the Retail industry the Restaurant industry is on a steady rise. “Manhattan is a big place for profit and business in general, there’s a lot of wealth there,” Brown said, explaining that a small business like East West has potential for a large amount of customers in Manhattan but the café/bookstore trend is a tough one in today’s market place.
The transition from full service café to snacks and beverages began only three week ago. No additions to events have been made to the events calendar, and while it may be too soon to tell what effect the move has had on profit and revenue in recent weeks there have been notably less customers in the café around lunch time.
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