In Texas, An Operator Finds Success With Turnkey Automated Coffee Bar

Posted On: 11/27/2019

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Fort Worth, TX-based Canopy Point Coffee is rolling out its automated Espresso Bar. The launch follows seven years of development and a two-year pilot that founder Jeff Osburn says demonstrated its appeal to today’s discerning coffee-loving consumers and the locations that provide it to them. The company is targeting hospitals, colleges, airports, travel hubs, apartment complexes and offices, and a big part of its plan is to align with office coffee service, micromarket and vending operators by licensing the turnkey solution for their locations.

Osburn grew up in the food and beverage distribution business in east Texas, working for his father in the meat and poultry processing operation that had been established by his grandfather. He took a BS in Business Management from LeTourneau University (Longview, TX) and earned a master’s degree from Biola University (La Mirada, CA), and went on to work with food manufacturers in operations, administration business development and sales. This remains his “day gig.”

“The coffee business has always been a side venture,” he told VT. “I hope that will change very soon as our new concept goes to the marketplace. That’s my dream, and where my true passion lies.”

His experience in selling coffee began in 2011, when he opened a full-service coffee shop. Despite his devotion to a premium offering and experience, the business fell short of his expectations. It wasn’t long before he cut his losses and closed it in order to seek nontraditional opportunities in the coffee arena.

The idea for the new Canopy Point Espresso Bar had come to him a few years earlier, when he observed hundreds of Starbucks kiosks in nontraditional locations like supermarkets and chain book stores closing with the onset of the economic downturn in 2008 and 2009. It became apparent to Osburn that a scaled down coffee service – even the Starbucks “On the Go” concept – faces the same challenges he did with his coffeehouse: the need for high-cost labor and expensive ingredients to execute successfully, and with a commensurately high drink volume required for profitability.

“Businesses were looking for an alternative approach to providing a coffee shop amenity,” Osburn recalled. “We believed that an automated, customer served coffee system could overcome the labor expense gap – but it would be successful only if the drink quality rivaled conventional coffee shops.”

One such location in Forth Worth was an Albertson’s supermarket with a vacant small-footprint coffee kiosk. “I saw quite a bit of opportunity for nontraditional locations,” Osburn recalled. “I knew we couldn’t have the footprint Starbucks did and would have to have a full line of products but without the full-time barista. I secured the location to operate an unattended retail coffee shop. This was my prototype, and my first experience with it.”

The automated coffee shop, featuring Cafection’s Total 1 bean-to-cup machine – the state of the art at that time – provided a high-quality range of specialty drinks. It was well-received, selling 10 to 30 drinks per day. Osburn operated it for six years, from 2011 to 2017. The only qualities that he missed, in his quest to rival the full coffeehouse quality and experience, was an option to provide real milk and the grinding, tamping and water pressurization that he desired to make authentic espresso.

As he sought out new locations that wanted a labor-free solution for bringing premium drinks to their employees and guests, he looked for a machine that included the missing pieces. He found it in a superautomatic espresso machine made by HLF Italian Designs, based in Treviso, Italy. He then customized and built on it to do full justice to his company’s prized coffees and deliver the coffeehouse quality and experience he envisioned.



ICE MADE EASY: Jeff Osburn demonstrates how to prepare an iced drink by first placing an empty cup in the ice machine holder, which is controlled by an Android OS tablet that functions as a user interface. Customers are asked to enter their 10-digit mobile number in order for the ice machine to dispense, and an instructional video plays to guide them through the process. The customer then places the cup on the coffee machine tray and selects a drink, including milk if desired, and the payment method from the touchscreen menu. 

SPILLING THE BEANS

“We’ve developed the perfect system to deliver our coffee, but we still see our selves as a coffee company and not an equipment company,” Osburn emphasized. Canopy Point sources its specialty grade coffee beans directly from family farmers in Costa Rica, Guatemala, Honduras and El Salvador through its partner Javalliance, a farmer’s co-op committed to helping make a difference in the lives of the families and communities of its partner countries. The artisan coffees are locally roasted in small batches.

“Our partners are engaged in coffee, and that vertical integration ensures we’re doing right by coffee farmers and gives us access to great coffee,” he remarked. “We know the farmers personally, and helping others and generosity is part of what we are about.” CPC also contributes 10¢ per cup to charitable outreaches in inner cities to help those in need.

CPC’s Espresso Bar is designed to provide consistent, premium coffee and espresso-based drinks, including lattes, mochas, espresso, hot cocoa, chai and iced lattes. Osburn emphasized that a perfect cup starts with the company’s select artisan roasted, shade-grown coffee beans that are ground just before the moment of brewing. The water is heated to the optimum brewing temperature, then presented to the ground roast coffee under the correct pressure to extract the coffee or espresso shot. Its automated brewing system assures that each cup is perfectly crafted the same way, every time.

The system offers two coffee bean selections and has three soluble product hoppers to offer a variety of flavor selections, including chocolate and French vanilla. It also dispenses real milk, foamed to ideal consistency, in hot and cold drinks. Prices range from $1.75 for a 12-fl.oz. fresh-brewed coffee to $3.75 for a 16-fl.oz. flavored iced latte.

The 10” touchscreen interface guides users through selecting and customizing their drinks, and also can play videos. Canopy Point integrates a payment system that accepts all forms of payment, including smartphone wallets like Apple Pay and Android Pay, credit and debit cards and cash. A loyalty-card program allows customers to earn free drinks.

TURNKEY COFFEEHOUSE: Canopy Point manufactures the cabinetry for its self-serve Espresso Bar, which can be customized to match existing color schemes and styles and adapted to almost any space. The cabinetry provides counter space for the ice machine and cup tubes to the left of the brewer and the payment system, sweetener/condiment and lid, stir stick and napkin dispensers to the right. The machine is mounted on its own base cabinet.

ICE IS HOT BECAUSE IT’S COOL

“We knew we needed to offer iced coffee and lattes to complement our menu, especially in warmer weather, since they are hugely popular in every coffeehouse – especially here in Texas,” Osburn recalled. So he integrated a portion-controlled ice dispensing machine from Follett into the self-serve Espresso Bar.

He was on the money with this enhancement, as iced lattes and coffees average 35% to 40% of Canopy Point’s sales mix. “Without ice, we’d would be at 60% to 65% of the business we are doing daily,” he remarked. “It’s a huge part of what we do, and I’m not aware of another system with integrated, portion-controlled access to ice.”

Drink dispensing time ranges from 30 seconds to one minute. Osburn explained that CPC’s Espresso Bars can make between 100 and 150 drinks without restocking, depending on the sales mix. Its target is 75 drinks per 24-hour period. The Espresso Bar can be restocked while the milk cleaning cycle is running (required once per 24 hours), so about 30 minutes per day is all that’s required to keep things clean, restocked and ready to keep going.

To prepare a beverage, the customer selects a paper cup for a hot drink or a plastic cup for iced. For iced drinks, the customer first places the empty cup in the ice machine holder. The ice machine is controlled by an Android OS tablet that functions as a user interface. Customers are asked to enter their 10-digit mobile number in order for the ice machine to dispense, and an instructional video plays to guide them through the process.

The customer then places his or her hot or iced-drink cup on the coffee machine tray and selects a drink and the payment method from the touchscreen menu.

PERSPECTIVE: Canopy Point Coffee self-serve cabinet and counter system is shown in a breakroom where it adapts to available space and complements decor.

THE WHOLE PACKAGE

Canopy Point manufactures the cabinetry for its self-serve Espresso Bar, which can be customized to match existing color schemes and styles and adapted to almost any space. The cabinetry provides counter space for the ice machine and cup tubes to the left of the brewer and the payment system, sweetener/condiment and lid, stir-stick and napkin dispensers to the right. The machine is mounted on its own base cabinet.

The cabinet ensemble provides storage, a backsplash with optional finish and graphics, and a header section for lights and electrical supply. Laminate texture and color options are available to complement location décor.

“From our experience with our initial Espresso Bars, we are satisfied we can offer them in public-access spaces like hospitals and airports because they are secured and locked down,” Osburn said. “In an office, you know everyone there, so they are less likely to try to compromise the equipment. In places like a hospital, new people come through every day. Canopy’s payment systems and equipment are secured to prevent tampering, and each Espresso Bar is monitored by video.”

The system also employs a cellular gateway for connectivity to accommodate remote monitoring of transactions and status, sending error messages and warnings for ingredient levels, without the need to use the host location’s local area network to connect.

Canopy Point’s first two locations, which Osburn says have passed its two-year pilot test with flying colors, are in a convenience store and in a large church where its two Espresso Bars replaced a small coffee shop. They are meeting the demands of 2,000 people coming through each weekend.

“We are averaging over 50 cups per day at the church, but this is based on just two days a week,” Osburn said. “Our daily transactions on Sunday range between 125 and 175 drinks in about five hours. It’s been a great test for how many drinks the system can manage on a regular basis. We definitely need two systems there to handle such a condensed period of traffic.”

Through CPC’s “Shared Services Program,” Canopy Point supplies the equipment and installation, and provides all maintenance free of charge. No floor drains are required, and it only takes a 110- V. electrical outlet and a 3/8” water line to put into operation.

The customer keeps the Espresso Bar stocked and clean, which takes only about 30 minutes every 24 hours to make more than 100 drinks. Alerts and error messages are automatically generated to minimize downtime. Canopy Point pays a percentage of net sales as a royalty to the host location each month.

Osburn said Canopy Point has established relationships with several locations, including hospitals where it has installations lined up within the coming weeks and it’s actively pursuing others.


BE YOUR OWN BARISTA: Canopy Coffee’s 10” touchscreen interface guides users through customizing their drinks, iced or hot with a variety of flavors and frothed real milk as an option in 30 seconds to a minute. The machine accepts all forms of payment; mobile wallets, credit and debit cards, and cash are accepted. A loyalty-card program allows customers to earn points for free drinks.

“We’re finding tremendous interest now that we’re ready for a full-scale rollout,” Osburn said. “The drink quality speaks for itself. I went to barista school and pulled shots to ensure we are making the best possible drinks,” he reported. “It has to be that way when people are making a purchase from an unattended machine and may have an idea in mind of the old coffee vending machines. Our Espresso Bar exceeds expectations, and our repeat customers and loyalty are off the chart.”

CPCs other business model is to license its Espresso Bar to operators who want to make it part of their offering to their customer base. The equipment, which CPC can customize to fit the décor of any micromarket or provide as a standalone unit, is provided free of charge and backed by CPC’s ongoing service and support. The operator purchases coffee and other ingredients from CPC and pays the company a fee based on sales.

“Micromarket operators typically have to purchase fixtures and coolers,” said Osburn. “With us, they don’t have to roll the dice and make that investment, not knowing whether it will work. We minimize the risk to them, and they can fit it right into their own programs. We will work with them to help leverage their contacts and opportunities. Our Espresso Bar will be a unique big hit for customers who visit their micromarkets.”

MISSION ACCOMPLISHED: At Christ Church in Ft. Worth, TX, Canopy Point has two Espresso Bars in place to handle daily transactions, which on Sundays range between 125 and 175 drinks in a condensed five-hour stretch. The installation replaced a small staffed coffee kiosk and made more room for seating which has proven a popular gathering place with a true coffeehouse vibe, minus the barista.