Before there was Colectivo, the small-but-growing Milwaukee-based coffee chain, there was Alterra, the small-but-growing Milwaukee-based coffee chain.
In 2010, Mars bought the global rights to the Alterra name for an undisclosed sum to use for its single-serve coffee line sold in retail. And in 2013, Alterra cafes distinguished themselves by re-branding to Colectivo.
In the years since the Mars deal, Colectivo has more than doubled its number of units (currently at 17, with plans to grow to 21 in the next year or so) and has expanded outside of Wisconsin for the first time.
Just as Blue Bottle has garnered some consumer criticism following its recent acquisition by Nestle, so too did Alterra when it sold its name to Mars, company reps say. But in the years since, Colectivo has managed to keep its indie coffee cred without suffering a revenue dip post-deal.
“We didn’t sell the farm,” Fowler says. “We bought more seed.”
As the chain backlash continues and younger consumers, especially, seek out independent concepts, here’s a look at how Colectivo has maintained its independent vibe while posting growth each year.
1. Custom design
Everything at Colectivo—from its tentacle-like patio umbrellas and jewel-toned chairs to wooden planter boxes—is custom-fabricated for the chain. Each cafe has a unique design developed by an artist, instead of traditional interior designers. “We’ve fought to maintain our brand experience,” says Scott Schwebel, Colectivo’s vice president of brand, marketing and retail. “Every one is distinct, but it shares commonalities.”
2. From-scratch food program
Thanks in large part to the Mars money, Colectivo built a 15,000-square-foot bakery production facility, with a cafe attached, in Milwaukee. The facility, spun off under the Troubadour Bakery brand, scratch bakes all of the breads and baked goods sold at the cafes. They are also sold wholesale and through catering, with some 40,000 pieces produced each week. Colectivo’s commissary kitchen also makes a full menu of items, from the chain’s top-selling chorizo burrito to sandwiches and baked oatmeal.
Colectivo’s check averages vary by location but, due in part to incremental food sales, hover in the high-$6 to mid-$7 range, says founder Lincoln Fowler. (Check averages at the country’s 10 largest coffee chains average $4.83, according to Technomic data.) Company-wide, there are 10,000 to 15,000 transactions daily, with top-performing cafes making up to $2.4 million in annual sales, Fowler says.
3. A local gathering space
Part of Colectivo’s mission is to give customers a reason to stop in all day. Some locations are open from 6 a.m. until 9 p.m. or 10 p.m, and many host live music or other events. And Colectivo, in partnership with a Wisconsin-based brewer, produces and sells seasonal, coffee-based beers.
4. Community partnerships
Colectivo has sponsored a program in which consumers can trade their loyalty points toward a donation to the Milwaukee Homeless Veterans Initiative. The chain also collaborates with performing arts and environmental groups by donating day-old baked goods, providing coffee for events and more. These activities are promoted on Colectivo’s website and in its cafes.