Duluth coffee roaster is using City Girl to help drive growth

Owner Alyza Bohbot of Alakef Coffee Roasters has topped the cup with her 2015-launched City Girl Coffee of Minneapolis.

"City Girl accounts for most of the growth of the company," Bohbot said of the reinvigorated firm that she expects to top $2 million in revenue this year. "Alakef is still the majority of the company. But we will grow [revenue] about 25 percent this year.

"Our goal always is profitable growth without sacrificing our core values and priorities for our [14] employees, customers, and our commitment to quality and environmental sustainability."

Bohbot this month moved City Girl from her home to an office-warehouse-coffee bar in a renovated northeast Minneapolis building dedicated to small-food companies.

She is off to a good, three-year start as a coffee entrepreneur who has lit the fire under a reborn family business.

Bohbot, 32, also is the embodiment of the Minnesota specialty-foods movement that is growing much faster than the overall grocery market. She has emerged as a leader among women in her industry. And she's taking the risk of her life.

And Bohbot is enjoying reinvigorating a business started by her immigrant parents in Duluth in 1990.

Nessim, 70, and Deborah Bohbot, 65, emigrated from Israel to Duluth in the early 1980s. Deborah worked for the Duluth schools. Nessim, who grew up in Morocco, started Alakef in the basement. He wanted to introduce a darker, richer coffee.

Alyza Bohbot remembers as a schoolgirl putting labels on bags of Alakef and helping her dad at Midwest coffee shows. However, she never envisioned owning it.

After studying business in college, Bohbot worked in sales for the maker of Sam Adams beer as she pursued a master's degree at the University of Massachusetts. She planned a career in student counseling over beer peddling.

However, by 2013, the Bohbots were considering retiring. They wanted to sell Alakef. Alyza was the first choice, but not interested.

The Bohbots had talked to long-term employees about buying but they lacked interest and capacity. Moreover, Alakef was a mature business without much growth. It roasted coffee under its own and private labeled for coffee shops and retailers in and around Duluth.

Alyza Bohbot, after months of reconsideration, agreed to return to Duluth in 2014 to work with the employees and her dad for six months. A drive-it-to-buy-it test.

"The employees knew me, but I hadn't been there for years," she recalled. "I wanted to honor my parents and also the employees and the culture. Eventually, I reconnected with the business and the industry. I conceptualized the City Girl brand."

She was hooked.

In 2015, Alyza Bohbot struck a deal to buy Alakef for about $1 million over 10 years. She needed sales growth.

City Girl, only two years old, now drives that profitable growth.

Run from Minneapolis by Alyza Bohbot and Henry Stein, a former marketer with Caribou Coffee and Coca-Cola marketer who oversees sales, four-employee City Girl already is on the shelf as a premium-priced brand at the likes of Lunds & Byerlys, Kowalski's, Hy-Vee, several big co-op grocers and a major grocery chain in St. Louis.

City Girl has generated new revenue for Alakef, the Duluth roaster that employs 10.

"The hope is to keep generating momentum for Alakef through City Girl," said Bohbot, who also has placed the Alakef-branded coffee on some new retail shelves. "We want to hook customers on two brands. That gives us more depth and awareness."

This is not easy in the saturated coffee business.

Bohbot also is introducing the brands through partnerships with corporations such as Fox Sports, and women-centric festivals and sponsorships. Women around the world grow and harvest 70 percent of the coffee. Bohbot donates 5 percent of profit to the International Women's Coffee Alliance and other organizations that provide grass-roots support to low-income female growers.

Bohbot understands the organic, one-step-at-a-time approach to growing a business.

Her parents, after they moved to Duluth, were surprised by the allegiance of neighbors to mass-market brands of coffee, such as Folgers and Maxwell House. Those were the days ahead of specialty coffees.

Nessim Bohbot started Alakef as a roasting experiment in his basement. Growing in 1990, he opened the company in downtown Duluth, where it still resides on Superior Street, the main drag.

Alyza Bohbot said profitable growth is critical to providing Alakef the funds to buy the business. And good jobs for employees, including health insurance and a 401(k) retirement plan.

Neal St. Anthony has been a Star Tribune business columnist and reporter since 1984. He can be contacted at nstanthony@startribune.com.