Chad Watts has worked with U.S. veterans for years, selling medical devices to the VA Medical Center in Oklahoma City. He noticed that when veterans were around each other, they lit up.
So, he asked Brad Dean, a lieutenant colonel in the Oklahoma Army National Guard, who he often crossed paths with, if veterans had avenues to connect with each other after they’re out of the service. “Not really,” Dean said, as Watts remembers the conversation.
Scars and Stripes Coffee was born in 2018. The business allows veterans to sell coffee online and at events for about a 20% commission. They chose coffee because it’s familiar ground for both civilians and military members.
“We’re both sales guys, Brad and I, so we just said let’s see if we can put a sales force together that looks just like the military, and help veterans become better communicators,” Watts said.
The goal is to offer veterans an avenue to reacquaint themselves with civilian life, which many military members struggle with once they retire. Scars and Stripes offers structure so that veterans, who often receive retirement pay or a pension after serving for 20 years, can learn skills to sell and interact with customers and also find a community in civilian life, Watts said. “If I can become a better communicator at a farmers market, then I become a better communicator at home, at work and with my non civilian friends,” Watts said.
“We provide employment and income opportunities for veteran team members and empower them by giving them a hand up instead of a handout,” according to the Scars and Stripes website.
Last year, the company piqued the interest of former president Donald Trump. His team invited Watts and Dean to the White House to share about Scars and Stripes, Watts said.
There’s a $50 sign-up fee, which gets sellers sample coffee, business cards and a shirt. But it’s not mandatory, Watts said. Each seller receives their own website that tracks sales. When a customer purchases coffee beans from their website — which go from $15 for a 12 ounce bag up to $91 for a 5 pound bag — sellers receive 20% of the purchase.
Sellers also sell at in-person events, such as farmers markets and gun shows. There, they can either consign the product, and make the same 20% commission as they would online. Or, they can purchase the coffee at a discounted rate (from 25% to 35%, depending on the amount of beans they’re buying), which gives them a bigger portion of the sales. The largest event kit is $1,000 worth of coffee– which sellers can purchase for $650. If they sell out, they walk away with $350 of profit (plus any tips they make).
Scars and Stripes will also buy back coffee if, for instance, an event is cancelled, for the same price the seller bought it for, as long as it’s not damaged and sellers ship it back to corporate up to three days after the event, Watts said.
Members are set up with networks and training so they can navigate the selling. New sales reps are connected with squad leaders, who answer questions and offer mentorship through their selling. There’s also platoon sergeants and first sergeants, who mentor the group ranked below them. Everyone’s a veteran, Watts said, so there’s common ground and understanding around reacquainting.
“What we’re doing, we’re just connecting veterans in a healthy way, that they can then extend that out to many different areas of their lives,” Watts said. “It’s probably not an opportunity that people are going to retire on, but it takes work. It’s building your own business.”
The Oklahoma City-based business has attracted 180 members, who are contracted through Form-1099s, Watts said. In 2019, it brought in about $150,000 in revenue, which jumped to $260,000 last year, Watts said. Now, they’re on track to bring in about $400,000 this year, he said.
The Story of One Seller
Jon Pellum is one seller. He started his military career as a medic in the Navy and ended as an Air Force Reserve Officers Training Corps recruiter at Tulane University. He fully retired four years ago, and came across Scars and Stripes last summer through a Facebook ad that piqued his interest. Its emphasis on camaraderie made him sign up. “It immediately spoke to me,” he said.
Now, more than a year later, he spends some of his weekends at events selling the coffee in-person — earlier this month, he sold the beans at an airshow near him in Houston, Texas, and once a week, he sets up a popup shop for a microbrewery in the city. His selling has brought him as far as Chicago.
Events like these yield around $200 for Pellum. Typically, he puts in about 20 hours a week and, since he’s retired, it’s his main focus, he said.
“It’s the networking and the business opportunity itself outside of just selling that’s been really rewarding and has had me stick around,” he said. “I see potential in this, and I really enjoy it.”
Especially for people who want to have an impact with their companies, it’s important to recognize that many people don’t want to be seen as victims. “We provide employment and income opportunities for veteran team members and empower them by giving them a hand up instead of a handout,” according to the Scars and Stripes website.
Camaraderie can be a motivation as powerful as profits. “As a veteran myself, I found that it was something I’ve been missing and didn’t realize that I was missing,” said seller Joe Pellum.
Choice is powerful. Scars and Strips offers veterans the option to sell based on commission, or consignment.
This story and others on New Builders Dispatch are made possible by a sponsorship from the Ewing Marion Kauffman Foundation. The Ewing Marion Kauffman Foundation is a private, nonpartisan foundation that provides access to opportunities that help people achieve financial stability, upward mobility, and economic prosperity – regardless of race, gender, or geography. The Kansas City, Mo.-based foundation uses its grantmaking, research, programs, and initiatives to support the start and growth of new businesses, a more prepared workforce, and stronger communities. For more information, visit www.kauffman.org and connect with www.twitter.com/kauffmanfdn and www.facebook.com/kauffmanfdn.