Facing “historically slow sales” in a marketplace flooded with competition, the cooperatively owned Black Star Co-Op yesterday sent out a letter to its member-owners asking for their increased patronage to help keep the North Austin brewpub afloat.
Black Star suffered a 14-percent decline in beer sales over the last year, which co-op co-founder and kitchen team leader Johnny Livesay partially attributes to the increased competition and new craft beer options in recent years. When Black Star opened in 2010, they were one of only a handful of craft beer options in town. In recent years, brewpubs and breweries with tasting rooms have sprouted up across the city.
And, in terms of the kitchen, when Black Star opened, they were a vocal champion of the nascent trend of farm-to-table restaurants, showing a strong commitment to sourcing all of their food locally.
“Now, that doesn’t mean anything because everyone says they do that or does that,” Livesay said.
Black Star has always been driven by an ethos grounded in providing a livable wage for its workers and supporting social justice, recently signing a petition from Restaurant Opportunities Centers United and Presente.org to promote “sanctuary restaurants.” That commitment to its workers comes at a price.
“We’ve spent a lot more money on labor by not letting our front-of-house workers subsidize our restaurant,” Livesay said. But he acknowledged that Black Star’s pay structure, which includes a no-tipping policy, doesn’t give them much competitive advantage “when nobody else has to do that”
“It’s not easy to do the right thing,” Livesay said.
Black Star has made efforts to trim costs in recent months, cutting and freezing wages, paring back health benefits and performing layoffs. But the cooperative finally “reached a breaking point.” While Black Star has made some changes to try and stay afloat, they don’t intend to change their core mission or pay structure.
“That’s not what the co-op is trying to do,” Livesay said of Black Star, which has about 3500 member-owners.
Livesay knows that his brewpub is not the only local business struggling in the current over-saturated market.
“I’d be cautious if I was anyone looking to open a restaurant. It seems the Austin market can’t support certain types of restaurants and businesses anymore,” said Livesay, adding that one of Black Star’s fellow founding members is slated to open his own brewpub in the area this year.
Despite the slow first week of what should be the co-op’s busiest quarter of the year, Livesay said there is still hope that Black Star remains open. He recognizes that having a large member-owner base gives the co-op an advantage over many restaurants. That’s why Black Star’s 9-person board decided to put out the call for help from member-owners, a group the business says currently only accounts for six percent of monthly sales.
“We just need to have a normal month of sales, which would be like back to last year or even 2015 sales,” Livesay said.