I would really like to get some feedback from fellow coffee shop owners about pricing. In these economic times, as you watch your regular customers tighten their spending, stopping in a few less times a week, have you thought about changing your pricing to be viewed as more of a value? The fast food chains have done it and I bet some of you know of a coffee chain that has done it. I have considered it. My shop is currently known as top quality and is priced slightly below Starbucks. I am concerned about the profit of lower prices since it seems my cost of doing biz... payroll/ product cost/paper products keep climbing. Is there a chance to make up the profit with higher volume? What are your thoughts?

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Comment by comforteagle1965 on April 21, 2009 at 6:07pm
All good stuff thanks guys, I've been at this 16 years, it's good to hear what people are doing out there.
Comment by James Simon on April 21, 2009 at 5:37pm
I opened 5 years ago and all my speciality drinks were 3.25 no matter you ordered. Cappucino, Latte, or Chocolate Mocha, or Caramel Latte. Due to higher cost of everything I have left my Capp. and Latte at 3.25 and raised the price on all my other speciality drinks to 3.70. I serve excellant quality and am a microroaster and full scale bakery. I also raised the price of my big cookies Chocolate Chip and Sugar Cookies from 1.00 to 1.25. I wish i would have started out with these prices 5 years ago. Nobody cares that a cookie cost .25 more and a Caramel Latte cost .45 and the buisness def. needed the help. 3 increases of minimum wage to for my 4 locations and 25 employees has been a big hit to the bottom line. Hope this helps Jim Simon Owner Almost Heaven Desserts & Coffee Bar Clarksburg, West Virginia
Comment by Mike McGinness on April 16, 2009 at 7:02pm
It's an economic roller coaster indeed. Tough call. But IMO don't under value your product. Volume can only make up so much reduced margin. If the volume happens. If it doesn't increase enough you might find yourself in the position of needing to raise your prices back. In today's climate any price raising even if back to where it was could be a customer relation nightmare. I'm staying the course of not "cheap" but not high priced either keeping the focus always on quality and selection, so not necessarily Nordstrom but definitely not Walmart.

FWIW I'm typing this at the end of the 2nd best day I've had this year so am in a good mood. And it was the best whole bean retail day in 17 months 16 days in business cracking $100 for the first time. But I fully expect tomorrow to be one or even two hundred less overall at the register since today was so strong. That is the way it's been going since last Fall.

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