Starbucks to Raise Drink Prices Today
Starbucks Corp., the nation’s largest coffee retailer, said Tuesday it will raise the price of coffee drinks in its North American coffeehouses because of higher labor and store costs, even as its coffee-bean costs decline.
Starbucks said the per-cup cost of its drip coffee, espresso and blended beverages will increase an average of about 10 cents, varying by local market. The new prices go into effect today. Prices of whole-bean coffees sold by weight won’t change.
The price increases, the first since May 1997, stem from the increasing costs the Seattle-based company faces as it adds restaurants in expensive urban markets to appeal to upscale coffee drinkers. It now has more than 2,000 coffeehouses in North America and about 210 elsewhere in the world.
At the same time, Starbucks’ main raw material is getting cheaper. Coffee futures contract prices are about 18% lower than a year ago and last month traded at their lowest in two years, when they fell below $1 a pound on the Coffee, Sugar & Cocoa Exchange in New York.
Shares of Starbucks rose $1.63 to close at $38.69 on Nasdaq.