The rumors started in February, when paychecks for Zoka Coffee Roaster & Tea workers in Kirkland bounced. Owner Jeff Babcock said the company had just changed banks, and the new bank tried to pull money from the wrong account. Zoka switched banks again to avoid further problems. "We tried to explain, but they have a...
The rumors started in February, when paychecks for Zoka Coffee Roaster & Tea workers in Kirkland bounced. Owner Jeff Babcock said the company had just changed banks, and the new bank tried to pull money from the wrong account. Zoka switched banks again to avoid further problems. “We tried to explain, but they have a point that their paychecks bounced, and it was several days before it got fixed,” Babcock said.
Add to that a fair number of barista layoffs at the small coffeehouse chain over the past year, and the tales and conjecture grew. Today, Sprudge.com reported a list of rumors about the company’s financial situation that it says Zoka representatives denied off the record.
Babock says Sprudge didn’t call him for comment. Here are his responses to me:
Rumor 1: “Zoka is rumored to be dramatically downsizing its green buying practices.”
Babock: Green coffee buying is up, and he remains a judge for the prestigious Cup of Excellence mentioned in the rumor. Zoka will continue buying up to three COE coffees a year. Zoka does not buy them in vast quantities because “sales volume is only so high” for such pricey coffees, especially in a recession, so they sometimes run out before new orders are placed.
Most Read Business Stories
- U.S. pilots flying 737 MAX weren't told about new automatic systems change linked to Lion Air crash
- Will Amazon's HQ2 sink Seattle's housing market?
- Starbucks laying off 350 people, mostly at Seattle headquarters
- We freaked out over Amazon's HQ2 search. But it turned out to be for all the wrong reasons | Danny Westneat
- Amazon selects New York, Northern Virginia, for HQ2 expansion, reports say VIEW
Rumor 2: “Zoka is rumored to be closing its Kirkland store.”
Babock: It’s been profitable for the past month with record sales every day, after breaking even since it opened last August. Sales are up 15 to 20 percent since nearby Kahili Coffee went out of business.
Rumor 3: “We’ve received multiple tips from high ranking sources that Zoka’s current financial situation is dire.” (And suggestions that ownership will change.)
Babock: Zoka sold its Snoqualmie coffeehouse late last year to help pay for the new Kirkland store. “It’s been tight times, but the stores are all profitable, and the wholesale business is profitable, and we have good things to look forward to in the future.” A business partner in Japan pays licensing fees to use Zoka’s name, and Zoka is teaching them to roast coffee, but “they don’t own any part of our company,” and no ownership changes are in the works.
And a couple thoughts on Sprudge.com’s facts:
Fact 1: “For years, Zoka was the official coffee service for KEXP’s pledge drives. This year, Zoka pulled out completely….”
Babock: Zoka used to make coffee during pledge drives. “When you tighten up, you don’t have the extra staff to do that,” he said.
Fact 2: Zoka employees are embroiled in tax disputes.
Not Babock, but me saying: It’s unclear how an employer’s financial situation would create a tax problem for employees.
Fact 3: The bounced checks mentioned above, including a one-day employee walk-out.
Fact 4: Some people were laid off, or otherwise ticked off, by Zoka, and they have a Facebook page.
Update 5/26/10: Seri Ann Christina Shaw, who worked as a barista at Zoka in Kirkland until Feb. 28, said she does not recall a walk-out. She started the Facebook page, which “is about connecting circuits and making new roads to travel on.”