Starbucks Raises Prices in New York to Recoup Higher Costs
Starbucks Corp. (SBUX), the world’s biggest coffee shop operator, raised prices on certain beverages in the U.S. Northeast, South and Southwest to recoup higher costs.
In markets such as New York City, the price of tall brewed coffees and tall lattes increased by 10 cents, while the price for grande brewed coffees stayed the same, Jim Olson, a company spokesman, said today in an e-mail. The changes are the result of “the cost of doing business,” which includes distribution, materials and commodities, he said.
Starbucks, along with other restaurants, has grappled with higher raw ingredient costs during the past year. In November, Seattle-based Starbucks raised prices at cafes in the Pacific Northwest, Midwest and Southern California to help recoup higher commodity and rent costs.
Along with New York, today’s price increase includes the Atlanta, Dallas and Albuquerque, New Mexico, markets, Olson said.
Rising commodity costs, primarily for coffee beans, narrowed profit by 7 cents a share in the quarter ended Oct. 2, the company said in a statement on Nov. 3.
Starbucks, which has about 10,800 stores in the U.S., dropped 1.6 percent to $45.29 at the close in New York. The shares gained 43 percent last year.
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