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Coffee prices going up?

By lastresort - 18 April 2008 50

This morning, like many other Australians, I headed down to my local cafe for a coffee. So I ordered and waited patiently for my takeaway latte at this Manuka cafe, thinking about the day ahead. I was quickly snapped back to reality when I was told my lattee was going to cost me $4.20. Well, I nearly fell over. There were no signs, no warnings about coffee prices increasing. Nothing. So I questioned the rude Italian woman who runs this cafe and was told “coffee is going up, we need to pass on the extra costs to remain competitive.” I’m sorry. But $4.20 for a coffee? Forgive me if I’m wrong, but wouldn’t you want to absorb the costs in order to remain competitive – especially considering the huge profits cafes make on coffee? I know there’s a world shortage of coffee. There’s a world shortage of just about every soft commodity – grains, corn, rice, you name it. But this is getting ridiculous. Surely $4.20 is too much to pay for a coffee?

What’s Your opinion?


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50 Responses to
Coffee prices going up?
ant 1:52 pm 18 Apr 08

$4.20 is a rip. This week in Coles, you can buy a little 200g brick of Harris Black for $4.50. Makes a lot of very nice plunger coffee. And you’d think they’d be competing a bit harder in Manuka, where there’s plenty of places to go!

stereo henry 1:22 pm 18 Apr 08

Aldi were selling filter coffee machines for $7, i bought one and now I’m wired all day 🙂

Mr Evil 1:12 pm 18 Apr 08

Pizza in Civic – overcharged by $5.

Bottles of wine in Griffith – a dozen actually costs more than $20.

Paying $4.20 for a coffee in Manuka – Priceless!

astrojax 1:05 pm 18 Apr 08

voting with your wallet only works if you’ve somewhere else to take it to. a quick coffee at the cafe in the building is one thing, to trek off to another part of town is another and isn’t always possible. vote with a plunger, like magoo – oh, you’ve done it again!

even ‘expensive’ ground coffee is a boon saving with a plunger vs four bucks + a cup from the mafia…

stereo henry 1:00 pm 18 Apr 08

Yep, you’re right Neanderthasis… I used to run my own coffee shop and we were turning out cups at about 25 cents a cup (this was about 10 years ago) and were charging anywhere from $2.50 to $3 a cup.

$4.20 is an outrage, vote with your wallet and drink coffee elsewhere – they’ll soon get the message.

neanderthalsis 12:52 pm 18 Apr 08

Loquacious, your average coffee has a markup of 400 – 500% (figures I was told a while ago by a business associate who is CEO of the peak industry body for the hospitality trade, RCA).

Think about the process:
1 scoop of ground coffee 15c
water 0.2c
milk (if you have it that way)power for the coffee machine 15c or maybe 25c for a flat white)
depreciation on the coffee machine .0000000001C
Cup & saucer 1c
dishwasher to wash above mentioned cup and saucer 1c
Barista’s wage (10c if they’re a uni student, 18c if they’re a real person)
rent on building where to have the coffee 0.000000000000001c
hire purchase on the chair you sat on 0.000000000002C
Carbon emmissions tax (for future inclusions no doubt)1c

All adds up to well under a dollar.

Gungahlin Al 12:49 pm 18 Apr 08

I blame Cream. They started the $4+ coffee pricing. And I haven’t been back as a result.
Bardellis charge $2.70 for a large and (after several ownership chanrges) seem back on track and making good cuppas.

Bagels in the Canberra Centre do good coffees for $2.50 before 10am (plus a loyalty discount card).

But for pricey coffee, you just can’t go by Eagle’s Nest at the top of Crackenback Chair Thredbo – try $6+ 3 years ago! And the windows too iced up to enjoy the view to boot. They are a joke.

MrMagoo 12:48 pm 18 Apr 08

Sounds bloody expensive I agreed.

I’ve got a plunger for the office and one for home and I just use that.

I am hankering for a machine at home, but the Officer of Home Affairs isn’t a coffee appreciator so its a hard sell.

Heavs 12:43 pm 18 Apr 08

You think that’s bad – I heard about a guy who got charged $5 extra for his pizza.

neanderthalsis 12:41 pm 18 Apr 08

Agreed Jimbo, I invested in a good, but not top of the line, espresso machine with a steam wand for Mrs Neanderthalsis’ Decaf – skinny – Cappucinos and my espressos and have never looked back. Took a week or so to master it but now I can do coffees far better than your average Gloria Jeans/starbucks/neighbourhood coffee factory.

Loquaciousness 12:39 pm 18 Apr 08

The comment about remaining competitive sounds like a handy excuse to me. You are entirely correct when you say that “… wouldn’t you want to absorb the costs in order to remain competitive”. Regardless of the profit margin on coffee (which I don’t know anything about, but my understanding is that most food sales have only marginal profits), the word “competitive”, when used in a business sense, indicates that the person or business being competitive has something that gives them an advantage, or that makes them more attractive to consumers. In this case, raising prices is not competitive, but conforming. That is, “everyone else is doing it, so we are too”. Have you ever noticed that when you have a row of service stations on a street, there is always one that consistently puts its prices one or two cents lower than the others? And that they generally have more cars waiting at the pumps? *That’s* competitive. Maybe someone should have a word in your friendly cafe-owner’s ear – not just about the meaning of the word “competitive” but about why it can make good economic sense (and increase profitability, that always works for business owners) to keep her prices some 10-20c *below* the guys’ next door.

/me wanders off to boil the kettle …

barking toad 12:36 pm 18 Apr 08

FFS – make your own and stop clogging the ether with pathos

Or drink water, or beer

jimbocool 12:34 pm 18 Apr 08

Spend $150 for your own espresso machine and make your own coffee in the morning. Not only will you pay off your investment after 5 weeks, with a bit of practice you’ll be able to make coffee exactly how you like it. Trust me, you’ll never look back, especially with all the crap coffee that is sold in Canberra these days.

circusmind 12:29 pm 18 Apr 08

I get my morning flat white for 2.50–closer to 3.00 if i go for a double-shot.

LlamaFrog 12:26 pm 18 Apr 08

Wow, and I thought Starbucks had closed.

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