Coffee dispute could be nearing a resolution

Posted: Sunday, February 17, 2002

ANCHORAGE (AP) -- The Carrs Safeway grocery chain is sending signs that it might back down from booting local coffee roasters from its stores and replacing them with coffee giant Starbucks.

Perry Merkel and Tim Gravel, owners of local roasters Cafe del Mundo and Kaladi Bros., said they met this week with a top Carrs Safeway manager to talk about the possibility of continuing to serve local products at snackbars in several Carrs Safeway stores.

The meeting came a week after Gov. Tony Knowles denounced Carrs Safeway for its decision to go with Starbucks.

While there's no deal on the table yet, the Anchorage roasters said they were encouraged by what they heard.

''I'm looking forward to having something work out,'' Gravel said.

The Pleasanton, Calif.-based grocery chain apparently responded to an outpouring of support for the local coffee companies and the publicity generated by the company's replacement of the two Anchorage brands with Starbucks at two stores, Merkel said.

''It didn't put them in a good light,'' said Merkel. ''It was kind of like a David and Goliath thing.''

Carrs Safeway executives in Anchorage and Bellevue, Wash., didn't return phone calls on Friday.

Last week Carrs Safeway representatives confirmed their plans to substitute Starbucks for Cafe del Mundo and Kaladi at the espresso bars of at least five stores, and possibly more. They described it as a trial and a chance to offer Alaskans a new product. The company continues to sell Kaladi and Cafe del Mundo's coffee beans in the grocery aisles.

The coffee dispute raised hackles among many Alaskans still trying to get over Safeway's takeover of Carr Gottstein Foods Co. in 1999. Although it was owned largely by Outsiders when the Safeway takeover occurred, Carrs was a homegrown business with a loyal customer base. Many feared Safeway, one of the nation's biggest food chains, would replace Alaska products with Lower 48 brands and gain a monopoly over the Anchorage grocery business.

In antitrust negotiations with the state, Safeway promised to continue to support local vendors.

Gravel said he would like Carrs Safeway to erect signs that say ''Alaska Roasted Coffee'' or something similar.

Both men expect to hear back from Carrs Safeway in the next week.

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