Starbucks Coffee Just Increased In Price
The price of buying brewed coffee at Starbucks (NASDAQ: SBUX) has just increased without much fanfare. The coffee chain has raised its prices by anywhere from 10 cents to 20 cents at nearly 8,000 U.S. locations. A 12-ounce “tall” brewed coffee will now cost between $1.95 and $2.15, depending on location. The prices for other popular Starbucks beverages, such as lattes, mochas, iced coffees, and Frappuccinos, have largely stayed the same.
This is the third increase for Starbucks in three years. In 2016, the company raised the price of select cold brews, cold drinks and baked goods by 10 to 30 cents towards the end of the year after other increases earlier in the year. Then, Starbucks raised brewed coffee prices by 10 cents to 20 cents and espresso prices by 10 cents to 30 cents last year.
Normal inflation was cited as the reason for the price increase. A company representative said in a statement, “Evaluating prices periodically allows us to balance the need to run our business profitably while continuing to provide value to our loyal customers and to attract new customers.” According to the representative, the company has raised prices by 1 percent to 2 percent in the past year, which is “on par with the industry practices and is in line with food away from home inflation.”
A company official says the increase had nothing to do with the recent decision to close all stores on May 29 for employee anti-bias training. Starbucks closed 8,000 stores for mandatory employee training after two black men were arrested for waiting in a Philadelphia Starbucks. Footage of the arrests went viral, sparking boycott threats. The store closures cost the company an estimated $12 million.
Devoted Starbucks regulars are unlikely to be concerned about the small price hikes, allowing Starbucks to increase its revenue without scaring customers off. This latest price increase comes just two days after CEO Howard Schultz announced he was stepping down after more than three decades at the company. Schultz has been the CEO and executive chairman of the coffee chain since the late 1980s.