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Starbucks (SBUX -1.8%) plans to continue selling coffee at premium prices despite wholesale...

Starbucks (SBUX -1.8%) plans to continue selling coffee at premium prices despite wholesale input costs that have dropped off dramatically over the last year. Edward Jones analyst Jack Russo says the power of the Starbucks brand is elevated enough that consumers will pay up, although he warns $5 for a cup of joe might be the level where the company finally sees a bit of pushback.
Comments (2)
  • They don't sell $5 dollar cups of Joe so that shouldn't be a problem, Medium coffee is 2-2.10 Large is around 2.70-2.8

     

    Latte is entirely different and a consumer knows this when they buy one from any of the major coffee brands there is no major price diff when it comes to specialty drinks, from MCD to CBOU
    8 Nov 2012, 02:52 PM Reply Like
  • Starbucks has done an excellent job of increasing the quality of their stores and their products. The interiors of the stores are looking much better and the quality of their coffee has increased. As you note, the premium drink market for the mixed drinks can reach $5. People that have the disposable income, love their fraps and caramel machiatos. Drip coffee is still the low cost However the new Clover System that is being deployed in stores, can cost up to $4.75 for a cup of their specially processed premium roasted drip coffee. It make an awesome cup of coffee, however I believe it will only truly be popular with coffee connoisseurs.
    9 Nov 2012, 11:07 AM Reply Like
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