The coffee company raises prices for the second time in two years.
Already some of the most expensive coffee you can get quickly, Starbucks announced today that it will be raising prices again starting Tuesday, with the increases ranging from 5 to 20 cents for most affected drinks, the company said. This is the second time within two years that the company is raising prices, leading people to wonder if they are pricing out some of their customers.
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A small and large brewed coffee will each go up by 10 cents in most areas of the country, Starbucks says. That would bring the price of a large coffee to $2.45 in most U.S. stores. This follows after news that several gas station companies, J.M. Smucker Co., and even Dunkin Donuts would be cutting prices as they have found that the coffee bean price will go down in the coming months.
When asked why they are raising prices while others are lowering, Starbucks Corp. said in an email on Monday that coffee costs are only part of its expenses, which also include rent, labor, marketing and equipment. The statement said the company continually evaluates pricing to "balance the need to run our business profitably while continuing to provide value to our loyal customers and to attract new customers."
Another representative of the company, Lisa Passe said that she thinks the rise in prices will impact "less than 20 percent" of the customer base. However, she did acknowledge that prediction is based on purchasing patterns, which change with the seasons.
US Magazine says that the price hikes will mostly impact hot drinks, which is why they don't see a large impact now - during the summer cold drinks make up a majority of sales.
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- Prices are not being raised on any food items, Passe said. Starbucks has been trying to get more customers to buy food items like sandwiches in hopes of driving sales.