Cheaper Coffee? Not at Starbucks

Lower wholesale prices haven't tranlated to the chain's counters

   

Coffee 300x240 Cheaper Coffee? Not at StarbucksPeople will pay for their morning cup of coffee, even if it means paying a premium. That morning jolt is too important to let anything silly like price get in the way.

That’s what Starbucks (NASDAQ:SBUX) is counting on, anyway. The price retailers pay for wholesale coffee has declined approximately 30% from this time last year, as MarketWatch reports. But if you’re buying at a Starbucks, you aren’t seeing that savings. Earlier this year, the java chain raised the price of its drinks by 1%. With a 17% price hike in 2011, bagged coffee from Starbucks is even worse.

Not all retailers are charging a premium, though. J.M. Smucker (NYSE:SJM), which sells packaged Folgers and Dunkin Donuts (NASDAQ:DNKN) coffee, lowered prices in May. Of course, that followed a 23% rise in 2011.

A spokesman for Starbucks declined to comment for MarketWatch on whether the lower wholesale price would be passed along to customers.

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Article printed from InvestorPlace Media, http://investorplace.com/2012/11/cheaper-coffee-not-at-starbucks/.

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