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9/19/2004

Owner hopes Moxie makes world go ’round

By Ken Dey
The Idaho Statesman

BOISE, Idaho — Customers of Moxie Java are very familiar with the local company’s slogan, “Take a moment to Moxie.”

But owner Rick Dean is hoping coffee drinkers around the world will take advantage of the moment.

Dean is putting up a million bucks for a new world headquarters building for Moxie Java International in the Boise area and hopes to be serving up cups of coffee with the quirky name at more than 300 new franchised locations worldwide by 2008.

It is a lofty goal when one considers the company has only 70 locations now, while on almost every street corner in America there lurks an 800-pound caffeine-charged gorilla that goes by the name Starbucks.

Starbucks also has expansion plans that border on world domination. It already has 8,000 locations and last year said it was shooting for 25,000 outlets worldwide, including 10,000 in the United States.

That’s a lot of coffee and a lot of competition for Moxie Java.

Fortunately for Moxie Java and others competing against Starbucks, the world is hopelessly addicted to the black brew, an addiction that even Starbucks cannot fully satisfy.

Moxie Java also points to its milder roasted coffee as an alternative to the stronger roasts at Starbucks.

“There’s a tremendous market awareness of gourmet coffee,” said Tim Wright, Moxie Java’s vice president and general manager. “It’s not an us-versus-them. It’s us together working in the gourmet coffee market, and there are a lot of markets that are underserved.”

Wright and others are also counting on the company’s quirky name.

“It’s an unusual name. It’s a cool-sounding name,” Wright said.

Jerome Eberharter, owner of White Cloud Coffee, who founded Moxie Java with Chris Binion and John Roberts in 1988, said it was Binion who came up with the name.

“We were sitting around brainstorming, and I think I came up with some stupid name like ‘Java Joe’s,’ and Chris said he’d been playing with the idea of Moxie Java, as a play off of Mocha Java,” the famous coffee blend, Eberharter said. “We had no money back then, so we needed a name that rolled off your tongue, and Moxie Java was that kind of name.”

Eberharter sold Moxie Java to Dean in 2001 but retained the exclusive rights to supply Moxie Java with White Cloud coffee. This fall, the company will launch a major advertising blitz to try to sign up new franchises, Dean said.

Even without the advertising blitz, Moxie Java has been growing. There are now 70 locations across the country and as far away as Japan.

Dean said loyal customers — either visitors to Idaho or Idaho transplants to elsewhere — are behind the newest outlets, so at least they can get their Moxie fix.

Among them are Jennifer and Brent Hunter, who found themselves in Fort Collins after Brent was transferred from Boise’s Hewlett Packard campus.

“We got here and there weren’t any good places for coffee, so I said, ‘What if we were to open a Moxie?’” Jennifer Hunter said.

Three years later, she is ready to open her third Moxie location. Hunter said her customers have really taken to Moxie Java, and even a new Starbucks just a half mile away from one of her locations did not dampen business.

Starbucks is big, but the Seattle firm’s size doesn’t scare Eberharter away from expansion.

“They are very strong, but if the coffee quality and service is there, you can still win,” Eberharter said. And more people are demanding gourmet coffee, regardless of a sluggish economy.

The National Coffee Association, which has been tracking coffee drinkers since the 1950s, said the demand for coffee has not slowed. Its annual survey found eight out of 10 people questioned were coffee drinkers, more than half drinking at least a cup a day. Of those, 16 percent drank so-called “gourmet coffees,” up 4 percent from 2003.

Ted Lingle, executive director of the Specialty Coffee Association of America, said retail sale of gourmet coffee is a nearly $9 billion industry, and the number of gourmet coffee drinkers will likely double in the next decade.

“There’s certainly room for (Moxie Java), but it’s not going to be an easy task,” agreed Dan Geiman, an analyst with McAdams, Wright, Ragen in Seattle. “Starbucks has developed critical mass based on the fact that they’re on every street corner, so it’s easy to get your fix because it’s so convenient.”

Geiman said Moxie Java will have to find a way to provide more than just a good cup of coffee — something Starbucks already does.

“They really do focus on an atmosphere that the customers enjoy,” he said.

But Dean believes the loyalty of Moxie Java drinkers, who call Starbucks bitter and harsh, will pave the way to a successful expansion.

“We have a different flavor profile. Our coffee is less acidic than Starbucks,” Dean said.