They’re Fighting Order for a Coffee Cart to Go : Entrepreneurs: UCI Medical Center says it’s not renewing vendors’ contract, but couple say Marriott, fearing competition, is behind the move. The hotel president apparently will get involved.
Kelly Jeffrey always dreamed of running her own business, so when layoffs started thinning the ranks at Marriott Corp.’s hotel division last year, she decided to take the plunge.
She quit her job and, using her $20,000 profit-sharing check from Marriott, found a little cappuccino cart business serving customers outside the cafeteria at UCI Medical Center in Orange. The cafeteria was managed by Marriott, and she liked the idea of working alongside the company that nurtured her budding business career.
But now, she says, UCI is throwing her out--after telling her that Marriott is behind her ouster. The giant hospitality chain, she said she was told, doesn’t want the competition.
Doctors at UCI Medical’s neonatal unit were so incensed--especially since she gave birth only three months ago and her husband quit his job last month to help her--that they launched a petition drive. So far, 594 of the center’s 2,000 employees have signed petitions.
The employees vow to boycott any espresso-cappuccino stand that the medical center or Marriott puts in place of Jeffrey’s Divi Espresso cart, and some have started wearing buttons proclaiming: “Save the cup. Keep Divi at UCI.”
The resulting fracas has gone all the way to the top: J. William Marriott Jr., chairman, chief executive and president of Marriott International Corp. in Washington, has ordered an internal review of Jeffrey’s situation, and his office says she will be receiving a personal letter from him within a few days.
“Marriott doesn’t force people out of business,” a spokeswoman in the chairman’s office said Wednesday--placing the onus back on the medical center.
UCI’s position, however, is that it simply chose not to renew a one-year contract, spokeswoman Carolyn Cohen Carter said in a statement issued late Wednesday. She said that Jeffrey “is not being forced out of business either by Marriott Corp. or UCI Medical Center.”
Medical center officials have asked Marriott, however, if it would be willing to run a coffee cart at the center, and the company has said it would do so if asked, said Tony Alibrio, president of Marriott’s Connecticut-based health services division.
Alibrio’s unit runs the entire food and nutrition department at the hospital. “Operating one coffee cart isn’t our business,” he said. “We had nothing to do with her (Jeffrey’s) contract or the discontinuation of the contract.”
In other circumstances, Jeffrey’s situation would serve as a warning to would-be entrepreneurs of the often cutthroat nature of business. It becomes more than that because the little coffee cart grew into a profitable venture that prompted Jeffrey’s husband, Alan, to give up his job as general manager of a small bed-and-breakfast inn near Disneyland to help his wife after the birth of their daughter, Jaclyn, in February. Divi Espresso, simply, is the family’s business.
Jeffrey, 32, says she bought the cart and the contract to sell coffee beverages at the medical center because “it looked like a little business that would support us and be fun and interesting to run.”
She says officials at the medical center had to approve her purchase of the cart, allowing her to become a vendor at the center only after checking out her credit history and her credentials--seven years with Marriott and undergraduate degrees in both finance and marketing from the University of Texas at Austin.
She worked many long, hard days building the business, largely by opening early, staying late and dispensing smiles and cheerful conversation along with the coffee that recharged the harried doctors, nurses, interns and other staff members while on their rounds.
“I thought everything was going really well,” Jeffrey said. “In December, my husband and I decided to spend some money expanding the business, but I was concerned because the contract was up on June 30.”
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She says she met with the medical center’s purchasing director, Kirby Mellott, who assured her that “I was safe.”
“He said I could consider the contract extended through 1996 and that after that, he’d want to talk to me about a long-term contract, for six years or so,” Jeffrey said.
Bolstered by the verbal agreement and the assurance of the cart’s former owner, Robert Holo, that the medical center had honored a similar verbal contract extension with him in 1993, Jeffrey plunged into the family’s dwindling savings and bought about $2,000 worth of new equipment for the cart.
She also hired an employee to keep the cart open in the evenings to serve the center’s nighttime staff.
“We had to subsidize the night shift from savings because it wasn’t making a profit,” Jeffrey says, “but I felt that if we stuck with it that it would pay off.” The night shift worker took over from Jeffrey at 4 p.m. and closed at 9 p.m.
Jeffrey, seven months pregnant with her first child, also had hired a part-time worker in December to open the cart at 7 a.m. three mornings a week. On the other two mornings, Jeffrey pushed the cart onto the breezeway next to the center’s cafeteria patio. She went into labor the evening of Feb. 8 after pushing the cart back into its storage room.
In early April, Alan Jeffrey quit his job to help out, and sales increased with the added attention, she said. But two weeks later, UCI dropped the bomb: The Divi Espresso contract would not be renewed.
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In fact, Jeffrey was told, she was to be out by mid-May, a full month before her contract expired. The medical center was invoking a 30-day “cancellation-without-cause” clause, spokeswoman Carter said.
“I couldn’t believe it,” Jeffrey recalled. “I called Kirby (Mellott) and asked why, and he said it was because I was in direct competition with Marriott.” Mellott could not be reached for comment. In her statement Wednesday, Carter said that Jeffrey’s assertion of a verbal agreement with Mellott “has not been supported.” She did not comment further.
On the same day the cancellation notice arrived, Jeffrey says, her part-time employee was offered a job at the Marriott-run cafeteria. The cafeteria management also circulated a flyer that day announcing a new espresso cart that would start operating at the medical center two days after Divi Espresso was to shut down in mid-May.
Since delivering the cancellation notice on April 14, UCI has backed off and agreed to let Jeffrey remain until her contract expires June 30.
Meantime, Jeffrey works the cart each day while her husband fires off letters to UCI officials, Gov. Pete Wilson and the University of California Board of Regents.
Two weeks ago, the couple sent a personal plea to J. William Marriott and enclosed a photo of themselves and the chairman taken at a Marriott training meeting in Maryland two years ago. It was at that seminar that the Jeffreys met, and they were married shortly after.
On Wednesday afternoon, a frazzled Jeffrey steamed milk for cappuccino while waiting anxiously for word of her fate. “I knew running a business wouldn’t be easy,” she said, “but I never thought it would be like this.”
