Roasting Plant Coffee Has Expanded From New York To London And Now The Growth Picks Up Speed

It’s the pneumatic tube that ensures the fresh taste of the coffee at Roasting Plant Coffee, a chain that is primed to grow.

After serving as director of Profits Improvement at Starbucks and working under CEO Howard Shultz, Mike Caswell had an idea and an approach to launch his own coffee shop, Roasting Plant Coffee in 2007 on Orchard Street on the Lower East Side of Manhattan.

Using pneumatics or what laymen call, a tube, he developed a proprietary system Javabot to “produce freshly roasted, brewed by the cup in every store or ‘just in time’ home delivery of roasted beans,” he said.

That freshness gives it the edge, according to Caswell. “We’re the only chain to roast beans in-store and brew by the cup in less than a minute at a fair price,” he said. He added that “We don’t brew coffee until the customer orders it, so they get their beans when they are fresh.”

Roasting Plant Coffee with an innovative delivery system is roasting its coffee on premises and beginning to expand both in the U.S. and London.

Caswell is now chief innovation officer of Roasting Plant Coffee and chairs the board. Roasting Plant is owned by its shareholders, which include a private equity firm and two, family offices.

Currently, Roasting Plant Coffee has twelve stores with seven in the U.S. and five in London. That includes six company-owned locations in New York City, with licensed stores in Detroit, and at airport locations in Denver, Minneapolis and San Francisco supplemented by in-store locations at two Fresh Market supermarkets in Greensboro, N.C. and Palm Beach Gardens, Florida.

Why go across the pond

It opened across the pond in London four years ago to prove the concept worked internationally and set it up for overseas development. “We saw a competitive opportunity for a differentiated offering like ours-beyond Starbucks and Costa,” Caswell cited.

Yet candid Caswell admitted that opening in London, and having to travel there, made expanding more complicated. But he said, “From my perspective, it was necessary, because we’re playing the long game. If you think of Starbucks, we’re trying to lay the groundwork to chase them.”

Proving its concept

The concept has worked in New York City, Detroit, San Francisco, and now London. “We learned our coffee is universal,” Caswell stated.

It opened its West Village store in 2008, which ran for 10 years until the landlord wanted to increase the rent after its 10-year lease ran its course.

Caswell called the most challenging aspect of its business as “sourcing the absolute highest quality special coffee from around the world.” He noted that its director of coffee Genevieve Kappler recently sourced a local Yemen producer to find a new blend.

Roasting Plant also sells a variety of breakfast items such as muffins, scones and cookies and some lite lunch items. At its three new Washington, D.C. stores, scheduled to open in August or September, it’s introducing sandwiches and lite salads and may introduce soup.

In London, certain items didn’t work with the clientele, such as iced coffee, but it also introduced paninis as a luncheon alternative.

Margins in the coffee business have tightened

He also cited how margins at specialty coffee stores have tightened. He suggested that many of them face problems generating highly-profitable retail stores, due to “high cost of goods, high labor costs and slow process which reduce output.”

At Roasting Plant, automation “holds the key, because we can brew every cup to order from any bean and do it in less than a minute,” he noted.

In the next two years or so, Caswell envisions that its London stores will increase to 20, and plans on expanding in New York City and Detroit and adding Miami. He expects them to be company-owned and doesn’t envision franchising in the future. He expects it to increase to 25 or 30 locations by the end of 2024.

As the founder and CEO, he is now working with its recently named CEO Jamie Robertson, who used to oversee its London stores. How does the founder feel about moving from CEO to Innovation Director? Caswell replied that he feels fine about it, he’s a trained industrial engineer who is dedicated to innovation and those are his roots.

Caswell describes the three keys to the future success of Roasting Plant Coffee as: 1) Continue to excite customers, 2) Finding good locations, 3) Building the right team.