Good Coffee & COVID-19 - part 2 of 4 / layoffs
Friday night (Mar 13) I grabbed a hotel room. With an 18 month old son at home who wasn’t giving my wife and I any sleep — I knew two things: An unknown amount of 16 hr days lay ahead, and the work was going to be emotional and hard — so the other 8 hours I needed to sleep. Over the weekend I was on the phone with my brother constantly. My brother Nick, who is Good Coffee’s Director of Retail, is also my operating partner in the business. We worked the (possible) scenarios up and down and the goals were multiple.
Find a safe operating model (if it exists) for both staff + guests.
If safe, find the most viable operating scale for that model — understanding that in a scenario like this, burning cash is inevitable. If we could find a place where cash burn (month-to-month) was as minimal as possible, we could come out the other side as the type of employer who is helping our team rebuild their livelihoods when the storm is over.
In finding a viable scale that allows for jobs later, stretch to structure in a way to saves as many jobs (now) as possible.
Lots of modeling, conversation, and scenario planning later we had landed on something we felt was the next step.
I have to say, these last 5 weeks have introduced me to whole new dynamic of crisis planning. Business planning (in general) is typically done at various horizons, whether by quarter, year, 5 year or 10 year increments. Crisis planning is a strange excercise, working to put plans in place and assuming / hoping at best they will hold for a matter of weeks. You’re making decisions that have long lasting impacts, completely aware that tomorrow could bring an entirely different landscape.
While we’d found a model that was best case re: the goals we detailed above — the ‘next step’ involved a considerable amount of layoffs (19 to be exact.) We decided with our partners at the Woodlark Hotel (Doug & Jen — even as I write this… missing them a ton right now) to cease operations for Good at the Woodlark indefinitely. Additionally we decided to pivot our remaining three cafes to (strictly distance & occupancy regulated) take-out. We would run this approach at minimal hours (7a — 2p daily). Built into this model was continued shipping operations at our roastery.
• • •
I’m going to detour a bit of this post to talk about the human side of layoffs. I’m firm believer that ‘work’ is a team effort and I could never take full, or an oversized amount of credit for any success Good Coffee has had in the past. That being said, when you lead a company, there is no escaping the responsibility and pain you feel when you have to make decisions that negatively impact the lives of others, (whether as a result of your own failures, or a set of circumstances out of your control). It’s not wrong to feel these things, and you should feel them. Responsibility in my belief is one of the great contributors to accountability, and is something that should give all leaders a body of people they both serve and give account to.
It goes without saying that being in a forced position to make decisions that have negative implications attached to both sides is hard, so hard. I had a knot in my stomach the whole weekend because I think I knew deep down, no matter how we sliced it, lay-offs were inevitable. I think it’s important to talk about the humanity of this, to grieve those decisions, and to grieve the uncertainty and fear that other human beings are feeling on the recieving end of layoffs. If we didn’t hunker down gathering places like ours would be places of virus spread. And yet, by hunkering down we were setting people on a path that took them from ‘livelihood’ to something else.
Not something I talk about often, but in younger years I lived with communities who are forced to live outside — displaced, un-housed communities. It forever left an imprint on me seeing the impact, the mortality rate attached to poverty, loss of purpose and the things that seem to play in close proximity: alcoholism, other forms of substance abuse, depression and mental illness. I’m not saying unemployement is a direct feeder… there are people much smarter than I who can speak to this — and so I won’t. I am saying, however, in addition to being heartbroken about the precipise that Good Coffee, Portland and the rest of the country was about to cross — we made these decisions with the sober understanding that negative implications were attached to every possible outcome. There was no escaping the pain of the situation, letting our team know we were sending them out into the unknown, and that we were so incredibly sorry. I don’t exactly know how you deal with these feelings other than looking them in the face, grieving them and putting your hope in the fact that people are resiliant. We survive together.
• • •
Sunday night we shot a message to our team to let them know we would be in touch with more significant detail on Monday, but to prepare for a conversation addressing the hard realities ahead. We had worked through the weekend running all kinds of cash scenarios to figure out what additional support we could put in place, above and beyond what our people were going to receive from unemployment insurance. This was a tough excercise as we had no idea how long we were going to need to burn cash on overhead, with significantly depleted revenues (As of writing this our revenues are currently down 80%). We eventually landed on a scenario (a combination of offering severance in certain cases + covering medical / dental (for an extra month) through the end of April in others) we believed was a meaningful amount of support for those we would have to let go.
Monday afternoon we contacted everyone and laid out how heartbroken we were about needing to do layoffs, how much we cared about them and how committed we were to doing the hard work during this time to have jobs to offer them when the storm was over. I don’t know what to say about this other than: I’ve been incredibly proud of how our team has handled these times. Seeing them, and the myriad of others affected by COVID-19, pull together and push forward has given me no small amount of hope for what lies ahead.