At least six coffee shops, cafes and bakeries compete for customers within a two-minute walk.

But this isn’t Seattle. It’s little Langley, with just 1,000 residents or so.

The town is talking. The recent closure of the Langley Village Bakery has ignited discussion around town about how many of these establishments can successfully coexist.

“Most retail is fixed, so every new seller eats into another,” Michael Shuman said. Shuman, a nationally renown economy expert, said there is only so much coffee one person can drink. Shuman was a recent speaker on how to create and sustain a healthy local economy during The Record’s Exchange series.

Within the last few months, popular coffee bars and eateries on the South End have disappeared for various reasons.

The Magic Bakery in Freeland closed last week. J.W. Bistro on Ken’s Korner shut down last month. The Smiling Dog at the Bayview Cash Store went out of business in early spring.

For each store leaving, others emerge.

Locals Only in Freeland, 1 Angel Place – A Chocolate Bar in Langley, Pickles on Ken’s Korner and the 3Cats Cafe in Bayview just started their operations.

Sharon Hart, executive director of the Island County Economic Development Council, said when key businesses such as a bakery close it is always tough for the community.

“Small towns have a sense of ownership in those businesses. When a place closes, the lives of many people are affected,” she said.

Closures are not always related to economic failure, Hart stressed.

“It often has to do with how hard the job is,” she said. Long hours in the shop and bookkeeping at night can wear down the most committed entrepreneur.

But the market place in small towns can also become saturated, she added.

Before the Langley Village Bakery closed, it competed with at least three similar businesses in an area smaller than a football field.

A special draw

Some draw customers because of how they are run, where they’re based, or in-house specialties.

Island Coffee House was launched as a project of Teens Unlimited, a nonprofit organization that promotes youth entrepreneurship on South Whidbey.

Useless Bay Coffee Company stands out through its new and exiting venue. And the chocolate bar caters to people who like the idea of a coffee shop, but love fine chocolate drinks instead.

Yet all compete for the same pool of customers.

Hart said Washington has the highest rate of business start-ups, and the state ranks about 10th in business failures. About 20 percent fail within the first year.

“Often it’s the food-service businesses,” Hart said.

Whidbey Island’s economy, however, strongly depends on local entrepreneurs as the island lacks major industries and many large employers, she said.

“They are the backbone of our economy,” Hart said.

Shuman said cafes and coffee bars seem to have their own rules.

“Coffee shops appear to be different. There’s some evidence that when a Starbucks opens near an existing coffee shop, the business grows at both. This is because one is creating a cool destination for folks, essentially an entertainment zone,” he added.

“One thing coffee houses have going for their operations is the addictive nature of the product. People don’t let go easily, even if income is tight,” Shuman said.

Finding your niche among seemingly similar businesses is key, Shuman added.

“Local coffee shops should roast their own coffee so that their product is as good or better than the chains,” he said. “They also need to be attentive to great service, staying open long hours, providing space or other perks for community groups.

Still, they come

One local business owner testing the waters of South Whidbey is Kim Bailey. She will open Pickles on Ken’s Korner this weekend, and she considered her neighboring businesses in her planning.

There won’t be bagels at her shop nor espresso, for example, because other businesses on Ken’s Korner already cater to those needs.

“I didn’t want to steal any customers,” she said.

There are other ways to attract clientele, Shuman notes.

“Price matters. Starbucks is now raising prices,

and locals can and should deliberately undercut,” he said.

Competitive prices are tricky on Whidbey Island, however. Business owners have to deal with slightly higher prices on the island to begin with, and competition from a neighbor is hard to off-set. The profit margin is also limited and largely dependent on the diversity of the products.

When the Smiling Dog closed, Marty Fernandez, the coffee shop’s owner, said personnel and operating costs — compared to the average ticket per customer — is relatively high in coffee shops.

Shuman disagrees, to a point.

Food service often have popularity curves. New places usually experience an influx and then people go back to their usual habits.

To offset high peaks of business during bad times, Shuman said, it’s important to network with other local businesses.

The coffee culture in the Pacific Northwest may be a factor in cafes being such a popular business venture, despite the challenges. People love their lattes and shop owners like working in this leisurely atmosphere.

“Coffee culture matters a lot, though this has now spread to much of the country. The startup costs are quite modest, though to do it well, for example, roast your own coffee well, it is not cheap,” Shuman added.

“All local businesses need to work together to mobilize customers to one another’s businesses at all times, good and bad,” he said.