A Grande Kick in the Wallet

Starbucks price increases.


A Grande Kick in the Wallet

While international coffee giant, Starbucks, has managed to avoid price hikes sweeping the industry, the Brazilian drought and outbreak of coffee rust is causing a coffee bean shortage that has seen first specialty cafés, then Dunkin Donuts, and now Starbucks forced to raise their prices.

In a recent announcement, the super brand plans to raise prices on certain drinks by 5c to 20c and packaged coffee products in retail outlets by as much as $1.

They’ve been able to hold out as long as they have by buying from a variety of suppliers and penning advanced purchasing deals, but now competitive dynamics and the company’s overall cost structure are coming into play.

 

Tracy Lee Nicol
About the Author
Tracy-Lee Nicol is the managing editor of Franchise Zone Magazine and deputy editor of Entrepreneur Magazine. She studied her Masters degree in Art History and Visual Culture at Rhodes University and spent the next two years working and travelling in Asia. Her love of people, business and teaching is reflected in telling the stories of entrepreneurs, franchisees and franchisors, inspiring others to take the leap to being their own boss and bringing about positive change in South Africa.

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