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Radford Coffee Company: How a Nonprofit Uses Its Sales

Monica Levitan | mlevitan@email.radford.edu

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If you live in the Radford-Pulaski area in Southwest, Virginia, chances are you have been to or at least heard of the Radford Coffee Company (RCC). RCC is a nonprofit coffee and eatery shop, which donates their sales to schools in the Coconut, or Rio Coco River in Nicaragua, located in the boundary line between Nicaragua and Honduras.

However, since they are a nonprofit organization, how do they get the funds to purchase food, pay rent and electricity and update old appliances?

Co-owner of the Radford Coffee Company, Barbara Johnson said the company utilizes around fifty percent of the daily sales of food and upkeep for the shop. They also receive monthly donations to the nonprofit from a few individuals, but she said she sends that money directly to the Rio Coco River.

“We’ve only been open for two years, but we’ve already had to buy new fridges and new blenders and things like that, so I always try to keep a cushion in there … I don’t give every single penny of profit we make to the river, but I try to spend as much of it as I can,” Johnson said. “I try to keep a $25,000 bumper so that if something bad happens and nobody comes in that month, I still have money to buy the food.”

According to the U.S. Bureau of Labor Statistics, almost nine percent of people employed in Virginia work in the nonprofit sector.

Johnson, alongside her husband Eric, runs the coffee shop alongside six full-time and several part-time volunteers, who only make money in tips. According to Barbara, the average full-time volunteer works four to five days a week. Some of the full-time volunteers raise support from other people so they can help out at the coffee shop. Part-time volunteers could work anywhere from once a month to two hours a week.

Rachel Johnson, daughter of the RCC owners, was already working in the career world for 12 years before she decided to do something different.

“I was looking for something new and not sitting behind a desk all day; I was looking for a change. I started working in Honduras with the original people behind the nonprofit, and now I’m here cause that’s what God planned for me.”

Another volunteer, Jenna Huggins, Radford University Class of 2015 graduate, said she ended up at RCC when was trying to decide what God wanted her to do after graduation.

“I loved the community of Radford and wanted to be involved in a safe space where I could call home, with comfy couches and help the community,” she said.

When the Johnson’s aren’t working at Radford Coffee Company, they travel a lot doing disaster relief work, where Barbara can use her nursing license, and Eric can act as a licensed contractor.

Radford Coffee Company sends the rest of the profits made monthly, at an average amount of $3,000, benefiting 1200 students in 14 communities. The process of sending the money takes around five days and consists of electronically sending the funds to RCC’s sister shop in Vera Beach, Florida, of whom has a Nicaraguan bank account.

“They [the shop in Vera Beach] transfer the funds to Nicaragua and then the people who are in Nicaragua, which is a makeup of an American couple and some Mosquito-Indian guys that we’ve known for years, run the schools down there,” she said. “They take the money, and they buy school supplies, they pay the teachers’ salaries, they need a new in-port/out-port motor or whatever, that’s what they use that [the funds sent] for.”

When the Radford Coffee Company first opened, they made an average of $700 a day. Currently, that standard has increased to about $1200 a day.

After each shift, someone goes to the local Wal-Mart to stock up on food items they ran out of or were low on. Once a week they receive fresh food such as spinach,` from food distributors like Cisco and US Foods. Johnson said they do not have a budget when it comes to shopping, but usually spend $60 a day at Wal-Mart and $1,000 a week for the goods from the food distributor.

The Johnson’s decided that going to the grocery store after every shift is more cost-efficient and less wasteful than doing so weekly because “if there’s a little bit left over then we’ll use it the next day. It’s not like I’m buying for a month and then I have all of this waste at the end,” she said. “That’s another big thing with restaurants; you want to do things that have an as little amount of waste as possible because you’re just throwing that money down the drain.”

They also do this because their refrigerator and storage areas cannot keep more than a day worth of necessities in those places.

RCC is a faith-based organization and owes their success to God and for being in the right place at the right time. “There was no coffee shop functioning in Radford at the time we opened, but now there’s going to be three [including Radford Coffee Company],” Johnson said.

The Coffee Company initially looked into locations in downtown Radford on Main St., but Johnson said: “nobody would work with us down there.” When they came across space they currently reside in; they did not think they would be able to afford it.

“But it all worked out well. The town loves us, and we love that they love us. I’d love to say we’ve had an amazing business plan and stuff, but we just stay doing what we know what to do. I tried to decorate the place; I wanted people to feel like they’re coming to a living room and [are] comfortable and friendly and all that stuff.”

For entrepreneurs looking to start a non-profit business similar to the Radford Coffee Company, Johnson suggests that “you either need to know yourself or get people around you that you trust that know what, like if you’re doing a donut shop, get people who know how to do donuts. I think that could be problematic because it’s a lot harder than it looks. So I think you have to either like what you do or have people who like what they do because that’s going to translate into the quality of what you’re making and that translates into people coming back.”

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