Terra Bite takes on Starbucks
January 23, 2007
Terra Bite is a new coffee house (and non-profit organization) that recently opened in Kirkland with an interesting twist for a business model (more on this below). Is this the beginning of the end for Starbucks? OK, stay with me now as I try to explain...
Like most coffee houses, Terra Bite offers espresso, blended drinks, baked goods, sandwiches, and desserts. They also provide a cool setting where you can hang-out, play your favorite XBox/PS3 games on huge flat panel TVs(for free!), or just pop-in and pop-out with your hot drink in hand. Can you play your favorite video game at Starbucks on a huge flat panel? No!
So what is so different about the business model that might have Starbucks on the run? Well, Terra Bite is operating based on a "voluntary-payment" basis. Confused yet? Well I was when I first heard of the idea. Basically they have no cash registers, no fancy way to swipe a debit card, no signs with pricing, and no tip jar either. What you will find is an unassuming gray box, similar to a large square piggy bank, at the end of the counter. After you order your triple tall nonfat latte, and grab a sandwich--it's up to you on how much you pay, when you pay, and even if you choose to pay. I wonder if our resident homeless guy, Paul, has been to the Terra Bite yet?
Sounds crazy, right? I learned more after talking to the founders during their private grand opening party in late 2006. The Terra Bite was opened/founded by Ervin Peretz and Susie Allsup. Ervin (a Google developer in Kirkland, WA) hatched the idea while slightly intoxicated during a trip to Vietnam. Ervin describes the the voluntary payment system as "a convenience measure for the mainstream: a regular patron can just drop in $20 once a week, or even pay on-line. There are no punch-cards, or any other complexity; it's all based on trust. For those in need, it is a source of free food that is healthier, more available, and (most importantly) more dignified than the alternatives."
Ervin indicated they are looking at more locations for expansion. Many at the grand opening party were skeptical to say the least. Can it really work? Why nonprofit? Will they get enough traffic? Will people really be honest? I don't get it? Why in downtown Kirkland? All good questions. I guess we will have to wait and see how the Terra Bites does in the coming months and hopefully years!
BTW, it hasn't slowed down Starbucks just yet. They just opened another new Starbucks in downtown Kirkland (where the old Seattle Best/Reality Coffee site was). Can Ervin take on Starbucks? Only time will tell.
So if you are by the corner of Kirkland Avenue and State Street please check out the Terra Bite--it doesn't have to cost you a thing! Seriously though...good luck to Ervin and Susie! As usual, comments encouraged...Steve
I went down to Terra Bite randomly on a Sunday with my best friend because Janis had told me about it. Katie and I had this plan to just go in, get coffee and not pay because we wanted to see how it felt to just not pay. We ended up feeling so guilty that we drove back paid double what we would have and I offered to put a bumper sticker on my car to help advertise...it's a crazy mind game they have going there.
Posted by: Jessi | January 24, 2007 at 01:21 PM
I'm excited to try this new idea. I just hope that people will pony up the cash for the coffee because I'm sure that rent isn't cheap.
Posted by: Rick Takagi | January 27, 2007 at 04:23 PM
I really like this idea. (I must confess I can only speak about the *idea*...I haven't yet been to Terra Bite.) My initial excitement was later tempered by the thought that we've done this before and it has failed miserably (pick any communist state that has tried to force economic equality by spreading wealth). But then I realized that this was fundamentally different. It's not a government forcing us to distribute wealth. It's about relative worth measured by US. It forces US to look at the larger economic picture and assess how we fit in.
I wonder what I'll pay when I get a cup of coffee?
Posted by: Brian | February 01, 2007 at 12:37 PM
I just saw this today, can't wait to check it out - cool concept!
Though I agree about the mind-game thing - I'm sure I'll end up overpaying every time I go there :-)
Posted by: Em | February 03, 2007 at 11:42 PM
Finally COMMUNISM have arrived.. Tovarischs and comrads, I knew it would come!!!
Posted by: IVAN IVANOVICH IVANOV | February 06, 2007 at 10:53 AM
More power to you!
I don't think we'll try it, with all the press you will be flooded with a ton of people.
Posted by: Dennis Veil | February 06, 2007 at 07:53 PM
I had a very similar idea a while ago. Instead of "pay what you want" kind of place, I was thinking to have a bar/restaurant where it was very clear where your money was going. For example a sandwich can be 20% material, 50% rent and staffing costs and 30% revenue. The I would ask the customers to decide how much revenue I should have out of that sandwich.
If it's good I deserve something, if it's shit, I deserve not to make money out of it.
I'm sure there are a lot of places out there that have a revenue that is more then double the effective cost of the product and often for low quality.
An other idea is to let the customer decide how much food they want (for the same price). Far too many people leave food on their plates and sometimes people are not happy because you served them portions that are too small. The catch can be that if you order the maxi size, you gotta finish it, otherwise you have to pay more (or some other deterrent).
Food it's about making people happy and a restaurant that makes people happy should be celebrated and supported !
Posted by: pietro | February 06, 2007 at 08:30 PM
Guess who had the best coffee according to a New York Post blind taste test done by experts....... McDonalds....yep Mickey D's....so screw Starbucks and their $500000 coffee prices.............
Posted by: ch8ch | February 07, 2007 at 08:08 AM
Is there anyone who hasn't pondered this theorhetical approach? Of those who have considered it, few (any?) have had the confidence/faith put it to the test in the marketplace. Essentially, dollars are a measure of our energetic exchange as we engage in cooperative effort. As a holistic practitioner, I'm well aware that in nature (that includes you and me!) there IS a natural orientation toward balance...to maintain/achieve overall harmony within the system.
Politically, I view this approach as more democratic than socialist. Essentially, there is opportunity for the market to decide. The micro exchanges may not be exactly equal, but the macroeconomics of this model will likely illustrate an overall equitable distribution of resources.
The ultimate goal of any economy is to effecitntly match resources to needs. Interestingly, this again mirrors what we can observe in nature (including our own bodies). So often, scientist have looked to nature to provide inslight/solutions to our questions regarding flight, medicine, invention, and more. I'm glad this shop is choosing to explore natural law in the quest for an economical solution.
I wonder what this experiment will show us. Are we humans are such natural devients that we will land off-center? Or, are we still aligned with our true nature even amid our many diversions and divisions. I appreciate the owner's evident faith in us as a whole--what kind inspiration. I'm curious to see what this experiment teaches us. I expect it will provide valuable insight in our ongoing/collective process of discovering ourselves.
Posted by: Julie Glassmoyer | February 07, 2007 at 09:14 AM
I tried it...I liked it! Really a comforting place to hang. They need VOLUME to make this work, so do NOT hesitate to drop in! See ya kids!
Posted by: mikeyd | February 07, 2007 at 12:49 PM
If a child at age 8 can think up this scheme I am surprised it hasn't been approached sooner. When I was a child I like many had a lemonade/kool aid stand, instead of charging people, I decided to "name your price", depending on what you wanted to pay for your drink.
I ended up making 30 dollars from two packets of kool aid.
Please support Terra Bite if it is within your area. We need this.
Posted by: Andrew Hunt | February 07, 2007 at 04:42 PM
In addition I'd like to point out that it isn't about money at all it is what the product means to you. The price of items varies from person to person and the amount of available resources varies.
So in affect it is very biblical in that the person who barely has any money and puts in a dollar for a coffee has paid more than the person who has large amounts of funds and yet only puts in a dollar as well. If you go to Terra Bite will feel compelled to contribute to the community you are helping to support in the monetary amount available to you. Free of choice of course.
Posted by: Andrew Hunt | February 07, 2007 at 04:47 PM
I saw this on the news last night and I have to say, what a cool idea! I especially love it because of the non-politcal, non-religious undertone. I have fallen on hard times before and have had to avail myself of generous charities, only to have a religious pamplet slipped in with my food box or a political flyer.
With this lounge, a person who may only have a few pennies or nothing at all, can feel human again and have a nice cup of coffee and a sweet treat and maintain their dignity at the same time.
Posted by: CC Ryder | February 07, 2007 at 05:49 PM
Oh man this is best way to go out of business I have ever seen. I will be going all the time , bring everyone I know and not pay anything. I will be getting as much free meals and drinks until this place goes out of business due to their sheer naiveity. Socialism never works and I will prove it. At least I get to save some money on food and drinks for a month or so. Thank you crazy liberals!
Posted by: Andrew | February 07, 2007 at 08:37 PM
Terra Bite WILL NOT fail due to the basic traits humans posess which is GUILT,HONESTY,INTEGRITY and RESPECT.
I am a Regular Customer and thru friendships and support Ervin and Susie will do quite well. The atmosphere is one that is positive for too many people look at and see the negative aspects of Life. Terra Bite is an Exquisite Palace for SOLACE, those whom are inconsiderate,rude or obnoxious will not be tolerated or accepted may find discomfort and uneasiness!
Posted by: William | February 08, 2007 at 08:55 PM
Andrew, it is sad you feel this way- driving some asshole out of business is one thing, but these folks seem really nice and just want to help foster the sense of community so sorely missing from todays world.
I hope you feel very guilty after a few freebies, when you know full well you can afford a buck or 2.
Posted by: debi | February 09, 2007 at 06:45 AM
To *Andrew*: if you're an adult, you should already know that *what goes around comes around* and this universal law applies whether or not you are spiritual. You may think you'll get away with ripping off the cafe by taking and not giving back. Hey, you may save $20 worth of coffee, but on your way out of town, you may find yourself with a blown tire that'll cost you $200 bucks. That's karma4u. Be honest, pay it forward. Take care of others and spirit/God/universe will take care of you.
Posted by: Arlene | February 09, 2007 at 11:30 AM
I'm really glad to hear that so many people in the Seattle area are NOT big fans of Starbucks. (especially since Starbucks began there) I grew up outside of Seattle, and worked for a local drive-thru espresso stand. It was the best job I could've asked for as a high-school kid.
Then Starbucks moved in, right across the parking lot, and attempted to steal our customers and ultimately put us out of business. However, because we were locally owned and operated, and had a fantastic customer base we continued to operate, and the drive-thru still stands to this day!
Support Local Business!!!
Posted by: ex-seattle-ite | February 09, 2007 at 04:59 PM
Terra Bite is certainly an interesting idea and I hope that it does well but, how about a few hurrahs for Jo Cha (right next door)and especially Schnoo the frozen yogurt place a few doors up! John Lee is actually selling yogurt that tastes like yogurt. with lots of fresh toppings for the natural and green tea flavors that are available! Low fat, cool and creamy with that real yogurt tang that is missing from most yogurt products today. Both Jo Cha and Shnoo are beautifully decorated and comfortable, well worth the short walk up Kirkland Ave. from the main drag.
Posted by: Greg Elliot | February 10, 2007 at 09:47 PM
Snowy Valentine's Day greetings from the coast of Maine. I read about Terra Bite in today's BANGOR DAILY NEWS and will stop by for 'a bite and a gulp' when my wife and I visit Seattle in April. We'll also visit the neighboring shops. Way ta' go, Ervin and crew!
Posted by: Bob Cottrell | February 14, 2007 at 12:25 PM