Wine and coffee mark-ups

Why are you charged so much when you buy your wine in a restaurant or coffee from a cafe?
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03.Hidden coffee costs

Mark-ups hit cafe coffee

Wine isn't the only popular beverage that's leaving many Australian customers feeling short-changed. For some consumers, paying for a coffee in a café can feel like paying for liquid gold.

Last year, a bemused patron posted his receipt for two coffees on Fed Up Perth, a Facebook page dedicated to the high cost of food and beverages in that capital. A mug of both a cappuccino and flat white cost the customer a whopping $14.50 at a café in Scarborough, WA late last year. The post was shared 495 times and generated 565 comments from the group. 

Thankfully, according to the Gilkatho Cappuccino Price Index, $7.25 is by no means the average price for a latte, though the average price a Perth resident pays for a regular coffee is almost $4. Australians forked out an average of $3.50 per cup in the first quarter of last year, 40c more than in 2009.

“Coffee bean prices are currently at a three-year low internationally, but prices for a cup are showing no sign of decline, indicating customers are more likely to pay for an experience,” Gilkatho managing director Wayne Fowler said in 2013.

In February this year, coffee beans had their biggest jump in prices since 2000 following a dry season in Brazil. But even before this hike, economists predicted that coffee will rise to $4 per cup in the next few years. This is because the cost of the actual beans component of your coffee is only around 25c per cup, with the remaining costs attributed to milk and sugar, the container, the skill of your barista and – like wine in restaurants – the service, rent and wages of staff. 

But it seems Australians are happy to pay for the quality and experience that comes with barista coffee. The BIS Shrapnel 2013 Coffee & Beverages – Annual Tracking Study says café culture is here to stay, with coffee overtaking tea as the number one preferred hot beverage in Australia. 

Barista judge Rob Forsyth from Forsyth Coffee told CHOICE that compared with other countries around the world, coffee prices in Australia are at the lower end, yet coffee is far superior in quality. “Last year we had 60-odd nations competing in the world barista championships in Melbourne. About 150 judges come in, and they could not believe the quality of the cup of coffee in Australia and the value it represented."

Be your own barista

If you fancy becoming your own barista and avoiding further price increases in coffee – not to mention the café queues – consider buying a coffee machine.


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