Opinion - Time for a Coffee Wake Up Call: Why $6 is the New $5 for Your 6 oz Cappuccino
An update of: Cafe owner you’re probably undercharging your customers. Posted 11.10.23
As we continue our journey through the tumultuous landscape of supply chain issues, post pandemic-related challenges, and escalating living costs, businesses must adapt or risk being swept away. Cafe Owners, it's time for a serious question: are you charging your customers enough for that expertly crafted cappuccino?
We're noticing a trend in the specialty coffee industry: an upward shift in pricing and it is not subsiding. The rising cost of your 6 oz dine-in cup of coffee isn't a move born of greed, but rather a recognition of the challenging economic climate we face. And this isn't a movement restricted to niche establishments.
Consider Nicely Abel, a 3-time world latte art champion, and possibly one of Los Angeles's only career Master Baristas. Abel isn't hesitant to charge $6 for a 6 oz cup of coffee at Hooked by Nicely, and other renowned cafes in Hollywood are following the same path. It's a testament to the changing face of our industry and a clear indicator of where we should be headed.
Why? Consider the continual supply chain issues plaguing our beloved agricultural product - coffee. Crop shortages and astronomical transport costs mean higher expenses for everyone in the industry. Additionally, we're experiencing a decoupling of coffee differentials from the C Market, which is the global benchmark for Arabica coffee. This means that coffee producing nations are charging more for their product, independent of fluctuations in the C Market. When you add in increased living and business expenses, such as rising inflation rates and minimum wages, it's clear that our overhead isn't what it used to be.
Add to this the labor shortage we face today. Attracting and retaining expert baristas, capable of crafting those flawless espresso-based beverages and offering stellar service, is more competitive than ever. Baristas should be compensated at LEAST 20% above the California minimum wage to reflect the expertise they bring to the table. Such an increase might cover the rising cost of living and underlines the importance of their role in your business.
However, the call for a $6 cappuccino isn't a simple matter of boosting your menu prices. This is not about 'close enough is good enough'. This is about the relentless pursuit of perfection in every aspect of your operation.
Investment in high-quality training is crucial. Baristas must flawlessly perform each step of the coffee-making process, from pulling the perfect espresso shot to achieving the ideal milk temperature and texture. Latte art must become a work of precision, transforming each cup into a miniature masterpiece that's as beautiful to look at as it is delightful to taste.
Equally important is our baristas' product knowledge. A deep understanding of the coffee beans, from origin to processing to flavor profile, will help customers appreciate the quality and care poured into each cup.
Then comes the critical element - warm, inviting customer service. As the face of your business, your baristas' interaction with customers can make or break their cafe experience. Prioritizing customer service and fostering a welcoming environment is integral to the proposed price tag.
Ultimately, it's about giving your customers an experience that justifies the $6 price tag, making them see and appreciate the value they receive in return for their money.
In conclusion, the need for cafe owners to adapt to the changing landscape of the coffee industry is more pressing than ever. This adaptation involves a combination of careful price setting, investment in our workforce, and an unwavering commitment to excellence. We must raise the bar, and in doing so, raise our prices.
This is a call to redefine the value of coffee, one cup at a time. We welcome open dialogue about how we can adapt and thrive amid these challenges.
Deaton Pigot
Founder/ CEO
Tectonic Coffee Company