Business View Magazine profiles Coffee News, the world’s #1 restaurant publication, with world headquarters in Bangor, Maine.
Although you can read an edition of Coffee News while sipping a cup of your favorite java, the world’s number one restaurant publication is not actually about coffee – nor does is really contain a whole lot of news. Coffee News can more appropriately be defined as a form of retail advertising in the guise of a free print publication that is available every week to millions of people in restaurants, coffee shops, hotel lobbies, libraries, and waiting rooms in over 14 countries around the world. Each item in Coffee News is meant to entertain, and every new edition contains a combination of jokes, trivia, horoscopes, lucky numbers, unusual or funny news stories, and of course, the advertisements. It is a quick read for people while they are waiting for food or other types of consumer service.
Bill Buckley of Bangor, Maine, a former retail banker, is the President of Coffee News, which now has approximately 800 franchises worldwide and Head Offices in New Zealand, Australia, Poland, Spain, Namibia, Canada, Mexico, Slovenia, and Venezuela. He recounts the early days of the company, how he came to be associated with the brand, and where he sees it going and growing in the future.
“Coffee News was created by a lady in Winnipeg, Manitoba, by the name of Jean Daum,” he begins. “She was in the newspaper business and published some weekly, community newspapers. For a variety of reasons, she had gone bankrupt with those papers, largely due to some Canadian postal law changes. She was unemployed for about six months and decided that she needed to create a new type of publication. She couldn’t afford to mail it to everyone’s home, due to the cost of postage, so she looked for another way to distribute it.”
The story goes that while Daum was placing a lunch order at her favorite café one day, she found herself reading the nutritional information on a sugar packet to pass the time before her food arrived. The thought occurred to her that restaurant patrons would be prime users of something – anything – that was available and quick to read while they, too, waited for service. “So, she came up with the idea of Coffee News and created it as a restaurant publication,” Buckley explains. “Restaurants have several hundred patrons a week and, in some cases, several thousand. Initially, she did all of the writing, she did all of the ad sales, she designed all of the ads, she formatted it, she took it to the local print shop and they ran off 13 separate editions for the city of Winnipeg, which is a city of about 600,000 people. And then she hand distributed it to restaurants within the local community.”
Daum’s publication took off, with a response that exceeded her wildest dreams. People wanted to read Coffee News, restaurants wanted to carry it, and local businesses wanted to advertise in it. “She did this for quite a while,” says Buckley, “until one day, somebody called from northern Manitoba and wanted to know if they could have Coffee News for their restaurant up in this small town of about 15,000 people. Daum said, ‘Sure, but you need to buy the rights to your town, and publish it.’ So, the idea of a franchise came to mind. She got some attorneys involved and they created the Canadian franchise concept for her. She sold her first Coffee News franchise in Thompson, Manitoba.”
Buckley was introduced to Coffee News in 1995 when he discovered it in nearby New Brunswick, Canada, then made a call to Daum, expressing his interest about becoming her first U.S.-based franchisee. She sent him some materials and he was quickly convinced that it would be an “absolute, fantastic idea” for his community of local businesses and their local patrons. He explains: “Most small advertisers are not well-served by publications or media that give you half of the state for coverage, because you’re being forced to pay for more coverage than you really can use. What Coffee News did was allow small businesses to target customers where they get 80 percent of their customers from. Our local media, here, broadcasts about 150 miles in every direction, so you pay for that kind of coverage, even though you can’t take advantage of it. Coffee News went in the opposite direction and offered advertising for the small business, locally. And I knew that would work. So, in 1995, I bought the rights, got out on the street, and sold out the first edition.”
Like Daum, Buckley was immediately successful, notwithstanding his lack of publishing experience. “I was a retail banker; I had six branch offices that I supervised and I did mortgage origination. I had no experience in publishing, whatsoever, and no experience in advertising or designing ads or anything of that nature. But, it was such a simple concept that it was obvious to me what the job was and what I needed to do.”
Buckley began soliciting ads around town even before he had lined up his restaurants. “I just walked into most restaurants and said, ‘I have this free restaurant publication. It’s going to come out every week with new content and it’s free to your patrons. Would you like to give it a try for a week and see how your patrons like it?’ Well, all of the locally-owned mom-and-pop restaurants gave no resistance, whatsoever.” The new franchisee then went to some of the bigger chains like McDonald’s and Dunkin’ Donuts’ that were locally owned, while shunning corporate outlets, such as Starbucks. “Being local, I knew many of these people from my banking days. Most of them said, ‘Sure, no problem.’ So, I managed to get in about 95 percent of all the restaurants in the greater Bangor area.”
But, Buckley had not quite finished cornering the restaurant market. “Now, the other thing,” he says, “is this: restaurants are very competitive, so those that said ‘No’ to me, would periodically go around to all the other restaurants to find out what they were doing and what was going on in their locations. And everywhere they went they saw Coffee News. Even though they had said ‘No,’ initially, they were calling me after about six months to say, ‘Listen, we’d like to have Coffee News.’ So that’s how you get the other five or ten percent. No restaurant wants to be without something that everybody else has.”
Buckley eventually bought two more franchises to serve all 115,000 people in the greater Bangor area, as well as some small towns in the outskirts of the city. And, business was very good. “I bought three franchises and my net income in one year, after all expenses, was one-and-a-half times what I had been making as a regional vice president of the largest bank in the State of Maine,” Buckley admits. “And I had it down to where I was spending about two days a week on it.”
Daum soon realized that Buckley had figured out how to make the business work and called him with an offer. She said, “I don’t have anybody that’s qualified to franchise in the U.S., would you be interested?” “And I said, ‘Sure, this would be great, I’d love to sell franchises’. So, basically, she awarded me the right to sell her franchises in the United States. I became a sub-franchisor and I sold 20 franchises the first year. At the end of the second year I was up to 40. At the end of the third year, I was up to 80 franchises. By the end of the next year, I was up to 160, then I was up to 320, and it just kept growing.”
Daum and Buckley’s partnership was soon to become much closer. “We had realized that sometime in the future one or the other of us was going to die and we needed to protect the company,” he says. “So, we entered into a buy-sell agreement. We bought life insurance on each other’s lives and paid the premiums. Jean passed away in 2007. In 2008, I had the rights to buy her company in Winnipeg with the proceeds from her life insurance. So, now I own all the Coffee News franchises in the world. She had the worldwide operation; I just had the United States. But, we became the tail that wagged the dog, because she had 125 franchises in Canada and we had, at one time, close to 800 in the U.S.”
The Great Recession hit Coffee News hard, with restaurant closures presaging franchise failures. “We had six important restaurants close one month in Southern Maine, so we’ve had a lot of turnover with Coffee News in the last five, six, seven years,” Buckley laments. “We’re just starting to rebuild. We’re doing everything in our power to come up with ideas about how to sell more franchises. There’s no number that we’re targeting, we’re just trying to sell more. We advertise in some magazines, we have blogs, and we actually pay our franchisees to run ads to sell our franchises in their editions,” he quips. At the company’s most recent convention, Buckley says that a one-time offer was made to any existing Coffee News publisher, in good standing, the opportunity to buy one additional franchise at its original 1995 cost of $495, rather than the current going rate of $6,000. “We’ll sell 50 or 60 franchises at that price,” he says. The company’s goal is to get back to being one of the top 25 fastest-growing franchises on the Franchise 500 List published by Entrepreneur magazine.
Buckley believes that the success of Coffee News is predicated on two things: its value to its advertisers and its value to its readers. “The ads in Coffee News are exclusive,” he says,” that means that only one business of each type can buy an ad. And we don’t sell ads to restaurants because we want them to take it. In my editions here in Bangor – which are the longest-running editions in the United States – I still have three advertisers that were in my very first edition. Businesses advertise in Coffee News and they stay because they tell us they get good results.”
Regarding its readership, Buckley offers an analogy: “The Reader’s Digest takes multi-page articles and condenses them to a page and a half. We take a page and a half article and we condense it into one paragraph. For the same reason that people read The Reader’s Digest, or the comics, or read their horoscope, they want something quick and easy to enjoy. There’s eight minutes of reading material in Coffee News and we don’t want to give them any more than that. And, there’s no bad news in Coffee News; there’s no agenda. We’re not about ‘news,’ we’re only about fun and entertaining things to read while you’re eating or waiting for service.”
Some of Buckley’s writers who work out of Canada have been with the publication for 25 years. “I have a writer in Bangor that’s doing about half the writing now,” he says. “We put it all together in Canada and then we post it on a giant webpage for our franchisees who are in our system to download. As long as they pay their royalty fees, they’re able to download the content from the website and have their local printer print Coffee News for them. Here in the U.S., we have our own print shop, so we do most of our own printing for our franchisees. Essentially, the content is the same, worldwide, every week, although there are some variations in certain countries.” Franchisees all have the opportunity to wear customized shirts and sweaters with the Coffee News logo imprinted on them, supplied by Darter Specialties, Inc.
Today, because of the vision and determination of Jean Daum, and the entrepreneurial dynamism of Bill Buckley, Coffee News is both the world’s largest franchise publication and the world’s largest restaurant publication. “There’s nobody in the business any bigger than we are,” Buckley exults. “There are other franchise publications, but they’re not anything like Coffee News.”
Regardless of how big Coffee News may be on a global scale, the company’s success still rests mainly upon its business model of local businesses advertising their goods and services to local people where they eat and pass the time of day, locally. And as for the best type of person to run a Coffee News franchise, Buckley says that it is an individual who is able to sell and “who loves people, and who loves being out there.” In fact, many of his own clients, who have advertised with him for the past 20 years, have become great friends whose company he enjoys. “I can’t wait to go see them and take them to lunch or take them golfing, or whatever,” he declares. Or maybe, in Bill Buckley’s world, even just getting together for a cup of coffee and a chat about the day’s news, is more than sufficient.
AT A GLANCE
WHO: Coffee News
WHAT: The world’s #1 restaurant publication
WHERE: World headquarters in Bangor, Maine