MADERA COUNTY – Visitors to the Madera County Government Center at 4th and G Streets will soon be able to stop by for a Starbucks coffee, right in the lobby.
At their meeting yesterday, the Board of Supervisors voted 5-0 to enter into an agreement with Aramark to construct and operate a Starbucks Kiosk on the main floor lobby. Aramark is the company that operates food service for the Madera County Jail and the Juvenile Detention Center, and recently took over as concessionaire in Yosemite National Park.
There has been an ongoing interest in better utilizing the main lobby of the County Government Center, said Chief Administrative Officer Eric Fleming in his presentation to the Board yesterday.
“In early 2015 a more specific concept began to take shape and it included the idea of a coffee and snack shop that would provide an amenity for employees and create more of a destination for visitors to the Government Center,” said Fleming.
A small group began exploring the feasibility of the concept. One of the first meetings was with the area’s business development representative from Starbucks. After doing a walk-through of the Government Center, the Starbucks representative was intrigued by the location and felt that it had good potential. The one thing that eliminated it from consideration as a full service store operated by Starbucks was the lack of ability to install a drive-through window.
In discussing other Starbucks options, it was discovered that they have an existing business relationship with the County Jail’s food service provider Aramark. These two companies work together in other places, operating a scaled-back version called “We Proudly Serve” Starbucks.
“This type of arrangement still offers many of the most popular Starbucks drinks but allows Aramark to operate it and sell their own food products,” Fleming told the Board. “This seemed like a natural fit since the County already contracts with Aramark.”
Over the last several months, Fleming’s office continued working with Aramark to develop how this might best work for everyone. The cost for purchasing the prefabricated Starbucks Kiosk, furnishings and systems is $201,000. Aramark has agreed to finance this capital investment on behalf of the County and accept reimbursement without interest over a 5-year period.
The County will remove the existing information desk from the Government Center Lobby and provide connections for electricity, computer, phone, water and sewer. The 10-year-old furnishings at either end of the lobby will also be replaced, creating a gathering place for business meetings, employee breaks, and a comfortable waiting area for those doing business in the building.
Aramark has agreed to provide all of the expertise, staffing and management to operate the kiosk for a minimum of 30 hours per week during the County’s normal hours of operation Monday through Friday. Company representatives told the Board they would work with staff to determine the best hours of operation to fit everyone’s needs.
Aramark performed an analysis of traffic at the Government Center and estimated that foot traffic into the building is between 3,000 and 6,000 people per week. There are also about 300 employees working at the facility, many of whom come to work every day with a Starbucks in hand, according to members of the Board as discussed during Tuesday’s meeting.
Based on preliminary projections, the break-even point for the first five years would require roughly $200,000 in total annual sales. By year six, the capital investment will have been paid off and the break-even point would drop to roughly $160,000 in total annual sales. If sales fall below the County’s commitment to Aramark, the County will be required to make up the difference.
If and when the Kiosk reaches a point of profitability where it generates revenue in excess of actual costs, 20 percent of the profits would go into the County’s general fund for discretionary use.
This project was the brainchild of District 2 Supervisor David Rogers, who sees it not only as a benefit to the employees but, more importantly, as creating a familiar relationship between the public and the county government.
“When people walk into the lobby and smell coffee and hear music, it’s going to have the effect of relaxing people and give them a more homey feel,” said Rogers. “The public will enjoy it.”
Planners anticipate the kiosk will be operational by some time this summer.