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Why Do We Drink Starbucks?
By JLP | July 24, 2007
I saw over on the Consumerist that Starbucks is raising their prices again. This time they are raising them around $.09 per drink (the increase doesn’t apply to bottled drinks and food items as they are already expensive enough). I like their coffee okay, but their prices seem way out of line to me. If I could just get out of the habit of going to Barnes and Noble, I could quit drinking their stuff altogther (there’s just something about coffee and books).
How does this affect David Bach’s Latte Factor? If you buy a latte 260 days per year (5 days a week × 52 weeks per year), you’ll spend $23.40 per year, which is equivalent to losing $5,000 over 30 years.
Topics: Business News | 9 Comments »
July 24th, 2007 at 4:02 pm
Ugh, well that does it for me. I usually brew my own in the office anyway, but when I’m traveling or otherwise unable to I usually stop at Starbucks and just get the largest size black coffee. What I used to like is that it was still under 2 bucks after tax so I give them a couple singles and get back very little change. Now with a 9 cent raise and after tax it will push the price of the same coffee to just barely over $2.00 so if I were to use just cash I’d get 90 some cents back in coins! (unless I happened to have some change in my pocket)
July 24th, 2007 at 11:29 pm
I agree with Jeremy on this. It was nice to have a big cup of coffee under $2. I can see where they would raise it on other stuff, after all, the price of milk and stuff will fluctuate, especially with the big ethanol hype going on. But I highly doubt beans, power, and cups are going to fluctuate beyond inflation much considering their weight across the market in general. With the drip coffee, I would think there is more money to be made in trying to sell more of it rather than raise the price. It’s something that can be quickly produced in bulk with very little equipment and materials. Just some filters, beans, and hot water really. With them raising prices, it’s only going to be easier for me to convince myself to not stop off. But if they did something, like say lower the price, or maybe a free cup every six or so, I’d probably stop by quite a bit more often while I’m out and about.
With these price increases you’d at least think they could get some cups and lids that didn’t send hot coffee dripping down your fingers and on your clothes. I’m sick of driving with a half-dozen napkins wrapped around my cup. If it wasn’t out of my way most of my trips, I prefer the local coffee shop since their cups don’t drip, and I can usually continue to reuse it the rest of the day at the office and it still not drip.
July 25th, 2007 at 1:48 am
I agree with Jeremy its way to expensive for what you get back! Coffee at home is the best!
July 25th, 2007 at 8:51 am
I can’t stand their coffee. I prefer the cheaper stuff at a gas station or McDonald’s if I don’t make it at home. But Starbucks did suck me in with their Chai Tea. It’s unbelievably tasty, and hard to resist. I don’t get one often, maybe once or twice a month. I could easily drink one every day if I weren’t a tightass.
July 25th, 2007 at 9:02 am
I brew my own, and I actually like it better. If I’m at Starbucks, I’ll get a flavored latte or cappuccino. $2 for a cup of coffee, no. $3 for a foamy cappuccino, yeah I’ll pay it. But only as a treat, once every few months maybe.
Get out of Barnes and Noble and find some local used book shops. Same books for a fraction of the price. I recently went back to B&N and I couldn’t bring myself to pay $30 for a book.
At used bookstores you can get a fiction paperback for a couple bucks (compared to $8-12 at a regular store).
July 25th, 2007 at 11:40 am
Personally, I’m not to bent about an extra $23.40 a year. If you like coffee that much difference in a whole year probably isn’t that much to scream about. Of course the fact that that $23.40 is on top of a large sum is the real thing.
You could say that about anything. Don’s rules of finance.
1. Anything you do once a year or less, unless it is obviously huge, doesn’t really count. 1 x not much = not much
2. Anything you do once a month should be looked at a bit harder. 12 x not much = might be something. Some of your monthly bills (like cable?) are probably also a little more than “not much” also…
3. Anything you do every week you should think about. 52 x something = a good bit of something.
4. Anything you do every day should be scrutinized. You probably get the gist of the math at this point.
That’s why what you choose to do for lunch every day and where you choose to buy your groceries are such important choices. You eat every day, and 365 times even a small amount matters to most people.
If you buy a latte once a month, you can probably buy it anywhere in town guilt-free. If you want coffee every day, then care and consideration matter. Once a week? Well, everyone has priorities and you might prioritize coffee. But you might not.
Of course the pitfall of Don’s method is lying to yourself about what things are rare once-a-year kinds of choices. If I splurge on something kind of big every month, but it happens to be a different thing each time, that pattern doesn’t qualify as once a year.
But other than that, I’ve lived pretty happily by looking at relative frequencies like that. I can occasionally splurge and be pretty guilt-free about it.
July 25th, 2007 at 4:36 pm
I personally hate coffee so Starbucks is not a problem for me. However, you have envision coffee at Starbucks as a really, really bad thing rather than splurging and being happy with it – that ensures you’ll always want more Starbucks coffee and feel bad when you prevent yourself from buying it.
The key is to look at how much utility coffee really gives you.
August 13th, 2007 at 4:18 pm
It was interesting to read this article only seconds after reading the “Financial Tip Of The Day” on http://www.newcreditpro.info which read
“One coffee a day which costs $1.50 at a local coffee shop is worth $547.00 from your pocket.
———————————————————–Lets give up the coffee habit and go for the gold!”
I think this is one of the most true quotes or articles available to the finance world. Only one coffee a day at a mesely $1.00 is $365.00 per year… I don’t remember the last time I found a good cup of coffee for only $1.00.
August 17th, 2007 at 10:30 am
My wife and I stopped going to B&N recently in favor of walking to the local college library. We always considered B&N a “cheap date”, we usually browse and grab a coffee. But going over the finances, we were easily spending ~300/yr on B&N.
The library has vendo-coffee, and books there are written above an 8th grade level. It also helps with space efficiency, not having piles of books everywhere.