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The Digital Skeptic: Wake Up and Smell the Profits

NEW YORK ( MainStreet) -- Sam Penix doesn't want to be shown the money. He prefers to smell his way to profits.

"If you assume some sort of algo or machine is going to do the job," says Penix, owner of the Everyman Espresso shop in Soho, "you might as well not show up to work."

Penix owns not one but two of the highest quality, high-margin, high-end coffee bars here in caffeine-obsessed Gotham.

He specializes in a diabolically tricky end of the custom-coffee game: the so-called microlot brew. In other words, he scours the crazily fractured -- and frankly, skeevy -- global coffee market for the best of the best of those who grow, ship, roast, blend and finally brew coffee. The baristas he hires are as important as any step in the process.

"What people learn in this business is, with so many moving parts you can't be too exact," Penix warns. "If one piece of the chain sucks, the coffee sucks. And the customers won't come back."

Penix is brewing up some impressive numbers in this growing market. Specialty coffee shops such as Everyman account for about a third of the total U.S coffee market, which peaks at $32 billion, according to the Specialty Coffee Association of America, the Long Beach, Calif.-based coffee industry trade group.

He opened this second Soho location about a month ago, and it's easy to see why business is booming. When I happened in for a cup of what Penix told me was a microlot varietal called Pacamara from Santa Elena, El Salvador, it was to get out of the rain. But when I was served what was, without question, one of the best espressos I have had in years, I happily paid $3.50 for a cup, $19 for a pound of roasted beans and $80 for a hand grinder to improve my at-home coffee skilz.

Considering that I -- and everyone I know -- grumbles when paying a third of that for Dunkin' Donuts (DNKN) or the simply dreadful Starbucks (SBUX), when I smell margins like this, I wake right up. And I began pressing Penix for his secrets. Which took about zero effort.

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