Coffee

Starbucks Is Raising Its Prices Today. But By How Much?


Starbucks Is Raising Its Prices Today. But By How Much?

Photograph by Brent Lewin/Bloomberg

On June 25, Starbucks (SBUX) will increase prices by an average of about 1 percent across U.S. stores. It will be the first substantial price hike that Starbucks has leveled on its customers in about 18 months, when it raised the cost of some products in the Northeast and Sunbelt states.

The good news, for coffee drinkers, is that not everything is getting more expensive. In keeping with Starbucks’s targeted approach to raising prices, it all depends on where you live and what you drink. So in New York, for example, the price of a tall brewed coffee will still be $1.85, but Americanos and lattes will be 1o¢ more expensive. The price of Grande or Venti brewed coffees, Frappuccinos, and Refreshers will remain the same, and customers who bring in their own reusable cup or thermos save 10¢ on any drink, as usual. In other cities, a tall coffee is going up by 10¢. In all, less than a third of beverages will be affected by the price increases, according to Starbucks spokeswoman Lisa Passe. But it’s clear that customers should be prepared to fork out an extra dime on their next trip to Starbucks.

What else is new? Starbucks has been raising prices piecemeal for more than 20 years. Remember 1994, when a tall coffee cost $1.25 and Starbucks was a gourmet treat, not an everyday commodity? Let’s grab a cup of coffee and do the time warp:

1994: Due to “soaring coffee prices,” Starbucks announces its first price increase in more than three years, reports the Denver Post. Prices on all coffee products go up by less than 10 percent.

1997: “Coffee Prices Hit 20-Year High,” reads a USA Today headline. Starbucks ups the price of coffee by a nickel and espresso drinks by a dime.

1999: A cup of Starbucks coffee goes up by about 10¢ in the U.S. and Canada.

2000: To offset higher labor and store costs locally, the chain raises the price of coffee drinks by 5¢ to 15¢ in San Francisco, San Diego, and Sacramento. Shortly after, it effects a the same increase in most U.S. and Canadian markets.

2004: The price for a regular Starbucks coffee rises by 10¢, and a mocha goes up by a quarter. But customers are hooked. “In testament to Starbucks’ mastery of the gourmet coffee scene, customers barely flinched,” reports the Sacramento Bee.

2006: Most coffee drinks cost an additional 5¢ in the U.S. and Canada. The company said it was necessary because of rising costs, including fuel and energy, reported Nation’s Restaurant News.

2007: Mocha Frappuccinos go up by an average 20¢ in early January. In July, Starbucks raises prices on other coffee drinks by about 9¢ per cup, citing higher dairy prices. The chain’s chief financial officer warns it will be “very challenging” for Starbucks to meet the high end of its 2007 earnings forecast, reports FinancialWire.

2009: The prices on simple drinks such as lattes and brewed coffees fall by 5¢ to 10¢, while more labor-intensive beverages like Frappuccinos and Macchiatos get about 30¢ more expensive.

2010: Starbucks raises its prices on some large-sized and “complicated” drinks. A regular tall coffee remains about $1.50.

2011: “Grappling with higher coffee costs,” the chain boosts the price of a tall coffee 15¢ in the Midwest, Hawaii, Pacific Northwest, and Southern California, according to Reuters.

2012: The Northeast and Sunbelt states see prices rise by about 1 percent. For example, the price of a tall coffee goes up 10¢.

2013: Nationwide, prices rise about 1 percent.

While some coffee fanatics will surely grumble about paying more, it’s important to have some perspective. That $1.25 coffee? It’s $1.96 in 2013 dollars, which means prices have risen more or less in lockstep with everything else.

Venessa-wong-190x190
Wong is an associate editor for Bloomberg Businessweek. Follow her on Twitter @venessawwong.

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Companies Mentioned

  • SBUX
    (Starbucks Corp)
    • $78.63 USD
    • 1.02
    • 1.3%
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