Claudia Kwong, the owner of a new coffee shop in San Diego, is worried.

Just last week, the 36-year-old opened the doors to S3 Coffee, an Instagram-worthy palace of a coffee shop. In Grantville, on a street better known for auto shops and fast-food chains, she rented a grubby old Arby’s building and renovated it into a brilliant white, freshly painted coffee house.

Palatial white marble and brass fixtures outfit the trendy space, with fluorescent pink signs and massive television menus. She wanted to create a hangout space for local teens and college students, who would gather in her shop and eat acai bowls and drink coffee while tackling schoolwork.

She hired 22 people. She scheduled a launch party. She opened the doors on March 9.


A week later, the coronavirus pandemic is threatening her survival, as mayors and governors across the U.S. are mandating the temporary closure of shops like hers.

“No, we don’t have a plan,” Kwong said Monday morning. “We didn’t anticipate this at all.”

In ordinary circumstances, restaurants and coffee shops are known for high overhead costs and narrow margins. The most vulnerable stores are the ones that just opened — the shops founded by locals with personal savings and big dreams of entrepreneurship.

S3 Coffee’s new location on Mission Gorge in Grantville on March 16, 2020. (Brittany Meiling/The San Diego Union-Tribune)


S3 Coffee, which began as a family business in 2016, first opened at a much smaller location on Mission Gorge. But when the store gained quick popularity, Kwong decided to expand into a building four times the original size. She invested in a major risk, renovating the new location while still on the line for the old lease.

“We’re paying rent for this place and our old one,” Kwong said. “My lease is not up on the smaller location for another three months. I thought I’d be able to support both.”

Now, she’s not so sure. Her drive-thru isn’t quite finished being constructed. She’s rushing to Costco today to buy a temporary sign so she can write a menu to place out front. But even her menu is compromised, as she’s struggling to get food staples from her suppliers.

“We’re not the only ones,” Kwong said, referring to other small-shop owners. “We’re all in this together.


The costs of opening a new store are substantial, and it’s terribly unlucky to take a financial leap before a pandemic.

Just like much of America’s population , the majority of small businesses are unprepared for emergencies, according to the U.S. Chamber of Commerce Foundation. After a disaster, 40 percent of small businesses will not reopen. An additional 25 percent will close their doors over the following two years.

“Just survive. That’s the only thing I can think about,” said Maxine Zepeda, the 29-year-old new owner of Ryan Bros. in City Heights. “I just need to survive this one month.”

A recent immigrant from Ensenada, Mexico, Zepeda arrived in San Diego with a graphic design education but very little English. She began working in Barrio Logan at Ryan Bros., a local chain of coffee shops, to improve her English and get plugged into the neighborhood.


“In the beginning, it was hard because I couldn’t understand what people were ordering,” Zepeda said. “I’d never heard of ‘drip’ coffee.”

Craig Moreno works on his computer while visiting the Ryan Brothers Coffee location on University Avenue in City Heights on March 5, 2020. (Howard Lipin/Howard Lipin/The San Diego Union-Tribune)

Five years later, Zepeda’s English is perfect and she’s advanced from barista to a franchise owner of the Ryan Bros. brand, opening a new location on University Ave just months ago. It was her first business endeavor — an entrepreneurial leap of faith. Although she employs one part-time barista, Zepeda is mostly at it alone. She’s been working the shop Sunday to Sunday, open to close.

But now, as COVID-19 spreads through San Diego County , Zepeda is anxious. The businesses nearby have shut down their offices, and workers have stopped coming in. She’s had to cut the hours of her only employee.


Zepeda needs to earn $300 a day to pay her rent, bills, and the paychecks of her barista. But Zepeda, a stubbornly tenacious personality, says she’s working hard to not let the worry weigh her down.

“We have to keep a good attitude,” Zepeda said. “I’m going to be OK. Even if I struggle this month, we have a little money. I’m going to be OK.”

Some loyal customers — the mechanics next door, for example — are keeping her afloat, promising to visit daily during the crisis of quarantines. And Zepeda is offering deliveries to anyone she can reach so that they don’t have to come outside their homes or workplaces for coffee or lunch.

This is the kind of support both Zepeda and Kwong said they need to survive. They encourage customers to buy gift cards online or in-person that they can use later to help support the shop during times of low business. S3 Coffee even has an online link where customers can buy gift cards without coming in. If a mandated shutdown of dining rooms comes next, patrons can still support local shops by ordering delivery or pick-up.


“The most pressing thing for us is keeping my staff afloat,” Kwong said. “A lot of them have to pay rent.”