On Friday, Mayor Greg Fischer, members of Greater Louisville Inc. and Heine Brothers’ Coffee employees gathered in Hikes Point to cut the ribbon on the shop’s fourteenth Louisville location.
Fourteen stores is a lot for a local chain, which brings up the question: why are there so many?
At first glance, the answer seems pretty simple. Heine Brothers' obviously has good coffee that a lot of people like. But the locally-owned shop’s expansion actually provides us with an interesting look at how economic strategy and consumer and brand identity are part of every pour.
In 1994, two men named Mike Mays and Gary Heine opened the first Heine Brothers’ Coffee shop on Longest Avenue in the Highlands.
And Mays said the pair just kept expanding from there.
“So when a spot at the Douglass Loop opened, we thought, ‘This is another neighborhood in and of itself in the Highlands,’ and it does feel a little close to Longest Avenue, but we gotta take it,” Mays said. “Just as spots came open, we took ‘em.”
At one point, there were four Heine Brothers' coffee shops on a three mile stretch of Bardstown Road -- one at Gardiner Lane, the next at Douglass Loop, another at Eastern Parkway, and finally, the original location at Longest Avenue.
Clustering them together like that might seem counter-intuitive, but according to University of Louisville economist Jose Fernandez it’s actually a pretty common business strategy that’s sometimes called “flooding the zone.”
“A chain will tend to go into areas where they think competitors will go into,” Fernandez said. “And even if it is located near one of their own stores, because they are internalizing all the profits -- sure, they are cannibalizing some of their own profits, but they are preventing someone from coming in.”
That’s why, Fernandez said, you sometimes see shopping plazas with both a standalone Starbucks and a grocery store with a Starbucks inside.
Again, it’s a little risky because you might eat into your own profits -- for example, the Eastern Parkway Heine Brother’s location didn’t make it . But being there is an easy way to ensure competitors don’t snag a prime location.
This only works if there’s a certain level of brand loyalty, and that’s something that is a little more difficult to develop -- or quantify -- than the number of locations.
“Food and food consumption is a political statement and in case of restaurants it is a public statement,” said Jonathan Deutsch, who researches food culture and history at Drexel University in Philadelphia.
Deutsch said in food studies, there's a big distinction between private and public consumption. Unless you have guests, they probably don’t know what brand of coffee you choose to drink at home.
“But when I go to a coffee shop, especially in a city where people know each other like Louisville, you know, it’s a public act,” Deutsch said. “Who am I aligning with? What brand do I feel good about supporting and what brand do I feel good being seen inside?”
Academics sum up this concept with the term “food voice.” Essentially, what does the food -- or in this case drink -- that I consume say about me as a person? Deutsch said it’s something we think about all day long.
That's why it’s important for businesses to make their values known to customers -- and Mike Mays said Heine Brothers’ values can be distilled into one word:
“It sounds a little corporate, but we call it ‘GRIP,’” Mays said. “Great place to work, remarkable customer experience, impact and profit.”
By “impact,” Mays is referring to the company’s involvement in the community. For Heine Brothers’, this ranges from charitable donations to serving as a founding member of the Louisville Independent Business Alliance.
Their focus is incredibly locally-driven and it’s something customers, like Alex Bozich, notice:
“Supporting local businesses -- it’s important to me, it’s important to our economy,” Bozich said. “And that’s why I would choose Heine Brothers' over a place like Starbucks.”
Bozich isn’t alone.
If you’ve been to any of the Heine Brothers’ locations, you might have noticed some polaroids or digital photos of people all across the globe with their plastic refillable mugs form the shop. This started shortly after Mays opened the first store.
“Before we knew it people were coming in from vacation of themselves in France, or Florida or the Great Wall of China and with our plastic refill mug,” Mays said.
Mays said because of this customer support, he’s continuing to look for new locations. Within the next five years, he’s hoping to reach a total of 20-something Heine Brothers in the Louisville-area.
