The price of coffee beans is down 33% a year, why does the Starbucks latte only go up?

But many people will question that when commodity prices rise, such as the rise in coffee bean prices in 2014, Starbucks, Dunkin Donuts and many other companies have said that in response to price increases. Now the price of coffee is falling, and Starbucks in the United States also raised its price in July last year. The reason is also to reflect the cost.

In addition to the minimum wage pressure, rents are also rising in many markets, and Starbucks has to pay college tuition for 4000 employees, which will be passed on to consumers. Analysts say coffee beans account for about 20% of Starbucks' total costs. as for why retail prices have to be raised, Starbucks only said that their pricing came from a variety of factors, emphasizing that it was competitive.

Dunkin Donuts said that they provide price advice to franchisees, but the final pricing is determined by individual franchisees. According to the report, the retail price of Starbucks' super coffee may be reduced, but it is impossible for stores to compare it. Starbucks will only continue to increase prices in the future, and no matter how the price is adjusted, consumers are willing to pay for a latte that office workers have to have every day. Whether it is Starbucks or 7-11, or the general self-owned shop, the price only goes up. 7-11 coffee has increased by 5 NT dollars, or 12%. In general, a cup of NT $60 lattes in a self-owned shop has risen to NT $70, an increase of 16%. But in fact, the price of international coffee beans has now plummeted to its lowest level in two years, with a pound of Arabica coffee beans falling 33% to $1.11 from $1.65 a year ago.

Brazilian officials predict that this year will be a bumper harvest of coffee beans, resulting in a glut of coffee beans and a drop in prices, but don't expect lattes sold to consumers to lower prices. First of all, there is an increase in labor costs. "CNN Money" takes Starbucks in the United States as an example. Under the pressure of rising minimum wages in various states in the United States, Starbucks will take its profit space to raise wages. Not only Starbucks, but all retail food industries will be affected by the collapse of commodity prices. It seems that only gasoline reflects the trend of international oil prices. Drivers really save their wallets, but why do other prices not fall, and some prices go up?