Step into the former Caribou Coffee unit in Olde Raleigh, North Carolina, and you’ll catch a whiff of something unexpected: the scent of fresh-baked bagels and muffins. ­That’s because the Duraleigh Road location is now home to a Caribou and a Bruegger’s in one cobranded space.

While the two brands have long shared history—the first Caribou Coffee opened in Edina, Minnesota, in 1992, with a door that connected it to an existing Bruegger’s Bagels—the Olde Raleigh unit is only the third of its kind, with the first two cobrands located in Minneapolis.

“Caribou is really a coffee company that has offered food, and I think Bruegger’s is the opposite—they refer to all their restaurants as bakeries, which is foreign to us,” says Matt Spanjers, Caribou Coffee’s VP of business development and strategic partnerships. “When you bring the two of those into one room, you’re able to give guests an experience that’s really amazing and true to both brands.”

The grand opening in Olde Raleigh on Friday, December 20, drew in the masses, but the staff was well prepared, Spanjers says. Just as employees did in Minneapolis, the team practiced speed and efficiency by simulating orders, even at the unit’s drive-thru window. The first day rush at the Minneapolis locations, however, exceeded expectations when guests began lining up to camp out the night before the November opening, Spanjers says.

“It was a testament to how excited our fans were and how well people seem to be responding to the whole idea,” he adds.

The menu at cobranded units highlights Caribou’s coffee, tea, specialty drinks like the Berry White Mocha and the Caramel High Rise, and fruit and yogurt smoothies. Bruegger’s full food menu is available, including breakfast sandwich staples, pastry items, and a variety of deli sandwiches offered either on bagels or ciabatta bread.

Spanjers says the partnership between a coffee concept and a bagel concept was a natural one, but it didn’t come without challenges.

“When people come into a cobranded store, they’re not sure if it functions the Bruegger’s way or the Caribou way,” he says. “I think it’s a bit of a learning experience for people when they come to the concept for the first time.”

It doesn’t help that Olde Raleigh laws limited what the brands could do with the signage outside the unit, and the Bruegger’s logo isn’t highly visible from the street. But inside, the operation incorporates the best of both experiences.

For the first few weeks after the opening of the cobranded unit, employees will interact with guests on the floor to introduce them to the concept, Spanjers says. To streamline the ordering process, the space features two lines, one for customers seeking to just order drinks and one for those ordering drinks and food. As employees customize bagel and sandwich orders in the latter line, baristas make drinks so that both are ready for customers when they pay.

Cobranding in the Olde Raleigh unit allowed for change beyond the menu—the space revamp included a mixture of light and dark wood furniture, wrought iron hanging lamps, leather sofa seats, and a fireplace centerpiece.

“In the cobrands, we really wanted to capture a coffeehouse feel; that was a big part of what we thought we brought to the table,” Spanjers says, adding that Caribou is remodeling throughout the U.S. to modernize its North Woods–inspired interiors.

And the back of the house got an update, too. At the center of the new partially open kitchen is a large stainless steel oven visible from the ordering line. Spanjers says that it’s a huge draw for both brands, especially because an open kitchen isn’t common in all Bruegger’s units.

“One of the things that’s been the most fun about this process is working with a new company and getting to know everyone on their team,” Spanjers says. “It seems like it should be a relatively easy thing to combine two concepts, but it really impacts every single part of the business.” There’s been top-to-bottom involvement from both brands, he says, and both have learned a lot from the other. In 2014, Caribou and Bruegger’s expect to open between five and seven new cobranded units and are still scoping potential markets. Spanjers says cobranding is an exciting frontier for the industry that’s stemmed from customers’ expectations.

“Even before the first cobranded store was open, when we told people what we were doing, the response was really like, ‘It’s about time,’” he says. “I think guests are expecting more from their experience, and they want brands to excel at everything.”

By Tamara Omazic