When Consumers Complain About the Cost of Coffee, How Should We Respond?
Further thoughts on the paradox of coffee pricing and how we assign value to the people who make the things we love.
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Earlier this month, an article in Vox asked a question I’ve seen repeated time and time again: Why is coffee so expensive?
To be fair, the article—which is illuminating and well-reported—investigates why coffee is so expensive right now while also operating on the premise that coffee has always been costly. Although the author does a good job explaining the factors affecting coffee prices at this current moment (like inflation and well-deserved wage increases), there’s still an acknowledgment that coffee has long been priced beyond what many people can afford. “Your expensive coffee habit is indeed getting even more expensive,” the article’s subheading notes.
Every few months, one outlet or another will repeat this seemingly head-scratching question. Even Astrid Buffett, who is married to the sixth-richest man in the world, real estate mogul Warren Buffett, complained earlier this year about the price of a $4 coffee. The Vox article is the latest, and certainly won’t be the last, to ask, “Why is coffee so expensive?” But the fact that we continue to circle this question makes me wonder: Will consumers ever get an answer that meets them where they are?
THE PRICE IS TOO DAMN HIGH—AND LOW
About a year ago, I wrote about the paradox of coffee pricing. Ask some people, and they’d argue that the price of coffee was too low; ask a different subset of people, and they’d argue that it was too high. The truth is that both groups were right: Coffee is simultaneously undervalued and costly. On the production side, farmers are not paid nearly enough for their product and labor, but on the consumer end, pricing conventions around coffee are befuddling, can seem arbitrary, and can exclude many potential customers.
In my original piece, I tried to break down that paradox by focusing on the production side, looking at things like the C-market price (coffee is a publicly traded commodity, and its price changes daily based on the market) and how many farmers grow coffee at a loss. As a barista, this was the argument I repeatedly made to customers. When someone came in snarling about the high price of coffee, I tried to justify those prices by breathlessly throwing everything I knew into a single sentence: “CoffeeIsARelicOfColonialismAndFarmersAreActuallyPaidLessNowAndBaristaWorkIsHighlySkilledSoHere’sYourLatte.”
I wasn’t wrong, and it makes sense to start at the beginning of the supply stream to make an argument about coffee’s eventual endpoint. But my mistake was overlooking what the price of that coffee meant to the person in front of me.
This is not to diminish the necessity of having conversations about coffee farmers and the deep flaws in coffee’s value system—I have to imagine I’m not the only barista who has stood behind the bar and tried to give a curious customer a mini-lecture on the dynamics of the coffee supply chain. (When I write sentences like this, I fully understand why the hipster barista trope has become so ubiquitous.)
But explaining to customers why their coffee is so expensive using reasoning that feels removed from their day-to-day doesn’t seem to have gotten us very far. When I was a barista, I viewed someone complaining about the high price of coffee as an insult to me and my work. The result was a zero-sum game where I could not both honor the consumer’s original complaint and the work I had put into the final product.
Some people will complain regardless of how much they can afford (see the Buffetts). But $5, $6, or even $7 for a coffee drink (as the Vox article contends) can feel shocking—especially given that many people regard coffee not as a small luxury but as a daily necessity. According to Statista, around 78% of people get coffee from a coffee shop at least once a week, and 6% of people go every single day. That adds up over time—and while saving your latte money will never be enough to put a down payment on a house, the amount that people spend in coffee shops can still be significant. It’s fair for consumers to wonder why their drinks cost so much.
APPLES AND ORANGES
To explain why coffee prices are high, some try to compare it to over beverages. The Vox article interviewed a shop owner who saw coffee as akin to wine:
“‘You can compare it to other things in the beverage industry. You look at wine, right?’ he said. ‘It’s grown in far-away places, the manufacturing of the product is pretty intensive. Nobody blushes at a $10, $15 glass of wine at a restaurant, but somebody might see a $5 latte as expensive.’”
While there are some similarities between the two—wine grapes and coffee are grown in specific parts of the world, are often exported, and both require a lot of work to produce—I’d argue that this comparison is faulty. Coffee serves a very different function in our lives than wine. In the United States, we average around four alcoholic drinks per week, but three coffee drinks daily, which comes out to four times more coffee being consumed weekly than alcohol. At the same time, coffee is so integrated into our morning routines that we joke about failing to function without it: Don’t talk to me before I’ve had my coffee.
Coffee really isn’t like anything else, which makes it particularly hard to determine its pricing conventions. And when considering these recurring arguments about coffee’s price, I think we overlook a deeper question of how we ascribe value.
I keep thinking about McDonald’s workers in Denmark who make $20+ an hour and get six weeks of paid vacation. In the United States, many of the arguments against higher minimum wages, particularly for low-wage workers, are that employers can’t afford them—raising the minimum wage would either cause stores to lay off workers, close down locations, or raise prices. But in Denmark, McDonald’s locations seem to be doing just fine, and the cost of a Big Mac, the chain’s signature burger, is a few cents lower than it is in the United States.
So what’s missing here? Is focusing on the price of the coffee itself masking other issues about value, and what we’re willing to make space for? I’m not sure a world exists where coffee can be both affordable to consumers and profitable for farmers, but I do think we have examples of systems where, when people are put at the forefront, the other structures around them bend to make their safety and ability to live possible.
I also acknowledge that the answer might be that coffee just needs to be expensive to fairly compensate all the actors who contribute to its production. Maybe we should see it not as a commodity that we’re entitled to, but as the specialty, labor-intensive product it is. But we’re not there yet—we’re still dealing with this pricing conundrum on both ends of the supply chain.
Maybe this really is all about how we value the people who make the things we love. And while the idea that capitalism has fucked not only our economic systems but also how we code and create value, recognizing its influence actually gives me hope: The McDonald’s workers in Denmark seem to have something figured out. Perhaps refocusing our lens on value would mean we can stop pondering why coffee is so expensive for consumers because we’ll finally have an answer—and a pathway to a solution.