This fourth-generation Italian Market coffee shop isn’t worried about Starbucks, Wawa

The tour group walked past where Anthony Anastasio’s great-grandfather parked his seafood pushcart more than 100 years ago, and where coffee, chocolate, and gelato businesses now thrive.

“We stop here because of that family history,” the tour guide said. “I love that it’s a family business that has evolved with the times.”

Of all the shops on the Italian Market food tour, guide Jenn Hensell, 40, always makes sure to stop by Anthony’s Italian Coffee and Chocolate House, near the corner of South Ninth and Christian Streets.

“They also do a wonderful espresso and traditional coffee,” Hensell said, pointing her eight visitors to the family’s two stores, one for coffee, the other for chocolate and gelato. “I want to make sure you hit both of these businesses.”

Anastasio’s great-grandfather, Tommaso, started the family business as a single pushcart for seafood. Tony, the youngest of Tommaso’s seven children, started working on the market after sixth grade with a fruit and produce pushcart and parked it at 903 S. Ninth St. Eventually, Tony bought that storefront, which became a fruit and produce market, withstanding economic recessions and responding to changing shopping habits.

When Anastasio’s father, Tony’s son Thomas, moved the fruit and produce business into a larger location around the corner on Christian Street, fourth-generation Anastasio did not want to see his family’s store close.

So Anastasio, inspired by a school trip to Italy and armed with a food marketing degree from Saint Joseph’s University, transformed the family business into a coffee shop.

It’s rare for a family business to enter the fourth generation, with only 3 percent reaching that milestone, according to the Family Business Alliance. Today, Anastasio is facing another set of challenges specific to the competitive coffee industry and the Italian Market’s ability to adapt to a changing world.

Italian Market shops are open 9 a.m. to 5 p.m, he said, as if there is a caregiver at home shopping for the family. And Anastasio believes the market needs to improve street cleaning and trash removal, add public spaces, and remove blight to remain an attractive destination.

“We don’t want to change the face of the market, but we just want to clean it up,” said Anastasio, 47. “We love gritty, we just don’t like grime.”

While there is only so much he can do as an individual to improve the market, he’s been making changes to his own business to ensure its viability.

He extended his hours from 7 a.m. to 7 p.m. weekdays so people can stop by on their way to or from work. His business used to close at 1 p.m. Sunday, but now it is open until 6 or 7 p.m. that night, too. Twenty-five years ago, he said, they didn’t know how to make iced coffee, and now they can respond to coffee trends, including cold brew. He also offers a rewards card, which lets customers collect stars similar to Starbucks.

The coffee and snack industry will bring in $50.7 billion in revenue in 2019, according to an IBISWorld report, growing at an annual rate of 4.6 percent since 2014. Starbucks has almost a quarter of the market share, but independent coffee shops have been one of this industry’s fastest growing segments, the report states.

Though Anastasio declined to share specific revenues, he said the e-commerce coffee business, the coffee store, and chocolate and the gelato store have grown revenues about 10 percent each year for the last two years. He also said he has noticed an increase in visitors from beyond Philadelphia.

People throughout the country can order his products online, such as corporate gift baskets, he said, totaling about 20 percent of his revenue. And he has seen enough success to open a chocolate and gelato shop in 2003, and 10 years later, he moved the business next door to the coffee shop, where his great-grandfather had operated a seafood store.

“Side-by-side, these two stores represent the future of our family on the market as we continue to work together to preserve, to enrich, and to continue the family traditions for generations to come,” the store’s website reads in the section detailing their family story.

Independent coffee shops are more likely than another large chain to pose as a competition to Starbucks, said Scott Holmes, senior vice president of real estate investment firm Marcus & Millichap and national director of the company’s national retail group.

“The chains, I don’t think they have the level of service that we have, and that’s what we offer that is different," Anastasio said. "We’re not just selling a cup of coffee, we’re selling an experience.”

For him, Anastasio said, failure is not an option. And although there are challenges in having a storefront in one of the country’s oldest open air markets, that history also helps the business succeed.

His children, nieces, and nephews, the fifth generation, will work the counters on the weekends, he said, and his parents still live above the store.

“It’s in your blood. There really is no other way to explain it,” said Anastasio, who has lived in Washington Township for more than 20 years. “There’s just a natural calling to be part of the market, part of the community, and to help preserve what we have.”

Standing in his store this summer, Anastasio looked up at the photos on the wall and knew their stories.

“Please pay before killing,” Anastasio read, pointing out the sign in the black and white 1950s photo of his aunt and other great-grandfather, who owned a poultry store on the market. There’s an 1890s portrait of his great-great-grandfather, and a 1995 photo of his brother behind the counter with then-Mayor Ed Rendell.

“We’re proud to still be here. This is where my dad grew up, where I grew up, where my family first started, my great-grandfather first started,” Anastasio said. “To be able to share that with our customers, it’s so much bigger than a coffee shop, you know. We’re part of it. It kind of shows our roots.”

Sharing his family story and creating this authentic environment inside of the store is one way independent coffee shops can compete with such large chains as Starbucks, said Maurice Schweitzer, a professor at the Wharton School.

“People like supporting family business. They like that culture. It’s authentic to the place. It feels like you’re connected to Philadelphia when you’re there,” Schweitzer said. “The challenge is, is it convenient and are they getting a good value?”

A cup of hot coffee at Anthony’s cost $2 to $2.50, while cold brew is $3 to $4.50. Starbucks offers its Pike Place Roast for $1.95 as a Tall and a $2.65 Venti. Its cold brew ranges from $3.19 to the largest size, Trenta, at $4.59.

Anastasio’s coffee shop also offers a selection of such fresh-to-order foods as breakfast and lunch paninis and salads for about $10 or less. The “original” panini for $9 comes with sliced prosciutto di Parma, marinated mozzarella, roasted peppers, tomatoes, and fresh basil drizzled with imported olive oil. It is served on rosemary focaccia bread from North Bergen, N.J.,- based Hudson Bread Co.

Anastasio’s business also has a philanthropic branch, called Coffee for a Cause, where it says $5 from every pound of a specific coffee blend will be donated to help children with dyslexia read. They have raised $1,200 so far this year, and last year raised $8,775 to help 65 kids with dyslexia access audio books.

The company doesn’t spend money on advertising and relies on word-of-mouth or social media, Anastasio said. He employs about 10 people, with the most tenured person since the coffeehouse was founded in 1995 sticking around for 18 years so far, he estimated.

Employees start at $10 an hour with an average 40 hour workweek if they are full time, he said.

Anastasio said he is aware of how many choices customers have. There are plenty of itaucks throughout the city, a cult of fans loves Wawa’s coffee, and on South Ninth Street, people can stop by the coffee bar inside of Fante’s Kitchen Shop or the trendy Function Coffee Labs, which opened in 2016 at the corner of South 10th and Carpenter Streets.

But Anastasio doesn’t view other coffee shops in the neighborhood as competitors. He said he sees them as “partners.”

“I’m not just looking to make money. I’m looking to make an impact. I do it through making coffee. Some people do it through making pasta or making flower arrangements,” he said. “Sharing an experience. Sharing a tradition.”