MARINA STRAUSS
Globe and Mail Update Last updated on Friday, Apr. 03, 2009 10:44AM EDT
Rick Martens took time out recently from juggling the top job at Country Style Food Services Inc. with his regular gym workouts to read Always Fresh, about his archrival Tim Hortons and its remarkable evolution into an iconic Canadian coffee chain.
He picked up some pertinent points about the importance of quality fare, fine service and a tightly managed operation. “I wouldn't say it inspired me but it's an interesting book,” Mr. Martens. Whether it's the book's doing or not, though, his plans to revive the coffee and doughnut chain sound a lot like they're ripped from the Tims playbook. It's all part of a strategy to double current annual systems sales of $100-million within several years.
Mr. Martens needs all the pointers he can get these days, especially when it comes to running a coffee chain that goes head to head with the well-oiled Tims machine.
Mr. Martens, 53, knows all about how the coffee wars can leave its players with a bitter taste in their mouth. He arrived at the company almost six years ago as chief financial officer just as it was struggling in bankruptcy protection, the victim of an ultra-competitive coffee landscape.
Now, as president since early 2006 and facing even more brutal competition, he has come up with a recipe for change. He aims to build smaller, cozier coffee shops, locate them in office towers with a captive audience and attract a younger and more female customer base with healthier fare and a wider menu offering. That allows him to introduce higher prices on new items.
He has other avenues of growth in his sights, including putting coffee shops in the big-box stores that U.S.-based Lowe's Cos. is opening in Canada soon. That's a big win for Mr. Martens, but he's not just depending on that for his expansion. Shops in gas stations are a key focus, and one that Tims has not moved on nearly as much. But it's also crucial to his strategy to nab the downtown office crowd.
Essentially, he wants to transform the 443-café chain, most of it in Ontario, into a “with it” destination from its current image as “your parents' smoky doughnut shop.”
“What we've had in the last couple of years is a company that became a little dated and tired,” he says as he sips a “traditional roast” Country Style coffee, dressed casually in a crisp Oxford cloth button-down collar white shirt, open at the neck, and grey pants. “What we want to do with the company is modernize it and make it more contemporary.”
Curiously enough, as Tims has done, the plan looks like it is to deemphasize doughnuts at a chain best known for the doughy treats: the new focus is on coffee and breakfast and lunch items. And, as other chains are doing, Country Style is offering low-fat and more nutritious muffins and sandwiches, all in better appointed surroundings.
Certainly Tims is the closest rival to Country Style, in pricing and menu choices. Tims has evolved from its coffee-and-doughnut beginnings in 1964, to serving up premium coffee, flavoured cappuccinos, soups, sandwiches and other baked goods.
There's always the risk that Mr. Martens may be moving too upscale, losing some of Country Style's mainstream customers and not stealing away enough new ones from Tims or high-end Starbucks. Will old customers be snapping up the new cranberry chicken wraps and other fare at prices of as much as 20-per-cent higher than before?
His new vision entails renovating the shops with fireplaces and wooden chairs to replace bolted-down steel ones, and warmer coffee hues instead of the red and white decor. Jazz or popular music is being piped into the shops, while free wireless Internet service is being offered up at the tables.
Better service would help, too, so staff are being trained to look customers in the eye, engage them in conversation and keep the stores and their washrooms clean.
For all its improvements, Country Style knows it still needs a competitive edge and an important goal is to find some of the rare locations left where it can hold a captive audience. Mr. Martens figures locating his shops in office buildings where there is no other restaurant or café is the answer.
“Most people would go to Subway or Quiznos or Mr. Sub first before they would come to our place for a sandwich,” he concedes. “But if we're in an office tower, people in the building know us, they'll come there for breakfast, for coffee and lunch and catering.”
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