Birch Coffee co‑founder and chief operating officer Paul Schlader sat down with host Larry Port to discuss his role and the evolution of the New York‑based chain.
From a Dream to a Roastery
Schlader explained that his involvement spans “all things within the business,” from daily store operations to overseeing coffee sourcing and quality control at the company’s Queens roasting facility. He and partner Jeremy remain hands‑on, regularly checking that each outlet runs smoothly.
The original vision, according to the co‑founder, was rooted in “creating a space for us to enjoy our work.” Jeremy, who had spent time in early‑2000s coffee shops, wanted a place that reflected his own values and offered genuine service. “Service needed to be the foundation of what we do,” Schlader said, noting that the concept of service extended beyond simply handing a cup of coffee to a customer.
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Early Challenges and the First Store
In 2007, Jeremy asked him to research a specific refrigerator, and the request turned into an invitation to co‑found the business. Their first location opened in 2009 inside the Gershwin Hotel on 27th Street, benefitting from a low‑rent lease that allowed the partners to experiment without immediate financial pressure. “If we’d paid market rent, we would’ve been out of business quickly,” he noted.
Early missteps included over‑staffing the shop, assuming they would serve 600‑700 transactions a day when they were actually processing fewer than 100. The resulting cash strain forced the team to cut half the staff within the first month, a painful but necessary decision that shaped future hiring practices.
Despite those setbacks, the store attracted a steady stream of customers, and the company eventually expanded to include a small kitchen serving grilled cheese sandwiches, which became a lunchtime draw. Later, he decided to eliminate the kitchen operations, focusing exclusively on coffee because “the margin there is so much better.”
Building a roastery in Long Island City presented its own hurdles. Finding commercial space suitable for coffee roasting in New York City is difficult, and the equipment at the time was less advanced than today. Still, the team acquired its first roaster and began grading green beans, a step that deepened his commitment to the craft.
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As of this writing, Birch Coffee operates 13 locations, including 12 in Manhattan, one in Queens at Court Square, a spot in LaGuardia Airport’s Terminal C, and an outpost in Seoul, South Korea.
They value community.
Looking ahead, the company has streamlined its back‑office staff, now employing roughly ten administrative roles, such as a director of finance and district managers overseeing multiple stores. The emphasis remains on maintaining a lean operation that can stay profitable in a high‑cost market.
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In the middle of this narrative, the shift toward a smaller, more focused menu mirrors broader trends in specialty coffee, where many brands have found that concentrating on bean quality and brewing precision often yields stronger margins than diversifying into food items.
Schlader stressed that the industry’s future hinges on human connection. He argued that while AI can assist with routine tasks, the “forward‑facing” nature of coffee service—personal interactions, handling complaints, creating a welcoming atmosphere—remains resistant to automation. This belief has guided hiring decisions, with the company seeking employees who can adapt quickly and maintain a personable approach.
For those considering a career in coffee retail, he recommends patience and a willingness to learn from experience. “Time is the greatest teacher,” he said, encouraging newcomers to dig into their chosen field and become the best they can be, even if they face setbacks along the way.
