As a specialty coffee shop owner or cafe manager, it’s natural to keep an eye on industry trends, especially when major players like Starbucks make big moves. Recently, Starbucks announced that it would no longer charge extra for plant-based milk options, a decision that has sparked conversations among coffee shop managers and industry professionals. While the headlines may catch your attention, it’s important to take a step back and assess how such changes might—or might not—impact your business.
This article will dive into the nuances of the Starbucks decision, what it means for independent coffee shops, and how cafe managers can approach the pricing of plant-based beverages in a way that aligns with their values, operations, and bottom line.
The Starbucks decision to drop upcharges for plant-based beverages reportedly stems from consumer pressure. Many non-dairy drinkers expressed frustration over paying extra for their preferred milk options, labeling the charges as unfair. In response, Starbucks adjusted its pricing strategy. However, this move likely wasn’t made without careful consideration of its economic implications.
For large chains like Starbucks, pricing adjustments might involve negotiating better supply deals with plant-based milk producers or reallocating costs across their extensive product lines. Independent specialty coffee shops, however, operate on much thinner margins and don’t have the same economies of scale. That means decisions like these must be made more cautiously.
As any experienced coffee shop manager knows, running a cafe is a constant balancing act. The idea of coffee shop owners “rolling in profits” is largely a myth. Every dollar counts, and decisions around pricing can make or break a business.
Plant-based milks such as oat, almond, or soy typically cost significantly more than traditional dairy. They also take up valuable inventory space and may have shorter shelf lives. Simply offering these options demonstrates a level of generosity and inclusivity to customers, but that generosity comes at a cost.
If you’re an independent coffee shop operator, this isn’t just a moral issue—it’s a practical one. Offering plant-based options means higher costs, and those costs need to be offset somewhere, whether through an upcharge for plant-based drinks or adjustments to your overall pricing structure.
Deciding whether to upcharge for plant-based milk comes down to your specific business needs. There’s no one-size-fits-all solution, but here are some factors to consider:
One mistake many cafe managers make is blindly following trends set by larger chains. Starbucks’ decisions are based on their unique business model, which likely doesn’t align with the operations of independent specialty coffee shops.
Your business isn’t a mini-Starbucks—it’s a unique cafe with its own brand, values, and customer base. Instead of reacting out of fear or guilt, make decisions that are right for your coffee shop. Whether you choose to upcharge for plant-based milk or not, focus on what works for your margins, staff, and customers.
Pricing in the cafe industry is rarely straightforward. Many coffee shops use a “loss leader” strategy, where lower-margin menu items attract customers who then purchase higher-margin items. The key is to strike a balance that keeps your business profitable while offering value to your customers.
If you decide to absorb the cost of plant-based milk, you’ll need to adjust pricing on other items to make up the difference. On the other hand, if you choose to upcharge for plant-based options, be transparent about the reasoning behind it. Customers are often understanding when they know the added cost is necessary for the business to thrive.
Ultimately, the decision to upcharge for plant-based milk should be based on sound business reasoning, not external pressures or moral debates. As a coffee shop manager, your primary responsibility is to your business, staff, and customers.
If you decide to upcharge for plant-based options, don’t feel guilty—most customers understand the costs involved. If you choose to distribute those costs across your entire menu, make sure your pricing strategy supports your bottom line.
The lesson here is clear: don’t let corporate giants dictate your pricing decisions. Instead, focus on running a thriving, people-first specialty coffee shop. After all, your customers are coming to you for the unique experience you provide—not for a replica of what they can find elsewhere.
By keeping your business needs and customer expectations in mind, you can navigate these decisions with confidence, ensuring the long-term success of your cafe.
