BOSTON (TheStreet) -- Starbucks (SBUX), Dunkin' Donuts, Boston Beer (SAM) and their customers saw Boston's potentially contaminated water as an "emergency" until the city reached for its first cup of coffee yesterday morning. Then it became a crisis.Printed notes that read like apologetic obituaries for hot and iced coffee dotted restaurant doorways in Boston, whose residents had been boiling its water since Saturday. It's one of the more nominal effects of a pipe burst that forced more than 2 million people in 30 municipalities to use potentially contaminated supplies from a backup system. While state officials lifted the boil water order today, the situation affected businesses as small as Au Bon Pain and as large as Target ( TGT). Boston's water situation was been especially challenging for Canton, Mass.-based Dunkin' Donuts, which has 300 (or more than 3%) of its U.S. locations within the affected area. A statement from parent company Dunkin' Brands, which also owns Baskin-Robbins ice cream shops, says the company notified franchisees to cease using its coffee and ice machines, use boiled or bottled water and instruct employees not to wash their hands with affected water. A Dunkin' Donuts in downtown Boston taped a notice to its door apologizing to customers for its lack of coffee. Inside, the staff credited breakfast sandwiches for driving what little traffic there was on an otherwise dead morning. Dunkin' Brands instructed that location, and several others to "consider reducing store operating hours and only serve bakery products/bottled products from Pepsi coolers." In some cases, towns instructed stores to close altogether. To mitigate the damage, which can be nearly $13,000 a day in lost franchise revenue according to company financial information, Dunkin' Donuts is sending out its coffee in "sampling vans" with water from unaffected areas. "We had a crew giving away hot and iced coffee at a location in Quincy, Mass., and are giving away coffee to emergency responders who are working to repair the water main break site in Weston," says Dunkin' spokeswoman McCall Gosselin."In addition, we're going to have sampling vans in at least 10 locations in the greater Boston area (today) giving away hot and iced coffee."
Starbucks locations in Greater Boston opened yesterday with boxes of Via instant coffee packets stacked by the registers and baristas explaining how many cups could be made with a bottle of Ethos spring water (three). Baked and bottled goods were the order of the day at Starbucks as well, but its Boston operations were further diluted when Target announced that Starbucks locations at seven stores in the affected area were closed until the boiling order was lifted. Target also closed its cafes in those locations and -- like nearby Wal-Mart ( WAL), CVS ( CVS) and Walgreens ( WAG) stores -- stocked up on bottled water, paper plates and hand sanitizer after a run on those products over the weekend. "We want to make sure that we have the right items for guests in our stores so they have what they need when they need it," says Target spokeswoman Erika Svingen. Kelly McFalls, a spokeswoman for Natick, Mass.-based B.J.'s Wholesale Club ( BJ), says the bulk retailer was stocking "truckloads" of Nestle waters and Polar products after bottled water sales jumped 240% last weekend from the same period a year ago at locations in the affected area. Even Boston Beer, the maker of Samuel Adams beer, was dragged into the fray. The brewer halted production at its headquarters and research facility in the city's Jamaica Plain neighborhood. Boston Beer produces and distributes the most of its products at facilities in Pennsylvania and Ohio, but develops new varieties in Boston and still produces specialty products including its high-end Utopias series there. "We're suspending our brewing operations in Boston until we know more," says Boston Beer spokeswoman Katie Powell. "We're being a good citizen and we're aware that there's a serious water shortage. Hopefully we can start brewing again later this week." One company's misfortune, however, is a smaller competitor's rare opportunity. Outside a downtown Cosi eatery, dozens of people waited in line for hot coffee yesterday. When asked how her store was pulling it off, the Cosi manager responded simply "It's from Cambridge," an adjacent city with its own water supply. As the words left her mouth, a besuited Cosi manager from Cambridge entered the Boston shop with large urns off coffee in each hand.
At Au Bon Pain's 13 affected Boston locations, which comprise more than 5% of its global chain, staffers were instructed to use bottled water for coffee and tea brewing and produce washing. As a result, the Boston-based chain kept brewing while its bigger competitors' urns sat empty. Boston Beer's local shutdown made crosstown rival Harpoon Brewery the only large beermaker in the affected area still brewing. Harpoon, which also has a facility in Vermont, cites the very nature of beer's boiling and filtering process as reason to continue its Boston operations. Still, the company has ramped up water testing at its facility there. While Harpoon has stocked up on hand sanitizer at its tourist center and has taken to rinsing growler jugs with beer, it expressed confidence in both its water quality and product. "Water is the largest single ingredient in beer, so it's certainly an obvious concern," says Charlie Storey, senior vice president of marketing for Harpoon Brewery. "However, one of the great things about beer is that, in brewing beer, the product is boiled to ensure the safety and purity of the product. Historically, when the safety of the water supply is in question, people would drink beer." -- Reported by Jason Notte in Boston.