Starbucks Customers to Pay More for Complicated Drinks

Updated

Bad news, Starbucks (SBUX) fans: You might soon need to shell out more cash for your venti-sized extra-hot half-caff soy caramel macchiato. The coffee-shop chain said Wednesday that it will raise prices of some of its larger and more labor-intensive beverages in response to surging prices of green Arabica coffee beans.

The company warned that it may also increase prices on packaged coffee it sells to grocery stores in order to offset the effect of rising Arabica coffee prices, which are near a 13-year high.

But if your regular Starbucks order is a simple tall coffee, you're in luck. The company says the price hikes for its higher-end drinks will help maintain prices for some of its most popular beverages, such as its smallest cup of coffee, which costs $1.50.

Starbucks says that raising some of its prices will allow it to maintain its earnings outlook for fiscal 2011. Last month, the company said that rising commodity prices would force the company to absorb 4 cents a share of profit for fiscal 2011. Starbucks in July reported that its profit for its fiscal third quarter, which ended in June, jumped 37% over the year-ago quarter as same-store sales rose 9%.


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