Coffee prices hit $7 but Australian cafes still struggle to profit
A 6 oz coffee costs about $2 to make; cafes need to charge $7 to $7.30 just to break even.
Rising costs have pushed coffee prices to $7, but industry sources say most cafes barely break even on each cup. The math: a 6 oz coffee costs about $2 to produce, 80 cents in beans, 32 cents milk, 60 cents wages, about 25 cents rent and insurance.
After GST, a $5 cup nets only $2.50 profit. A cafe needs to charge $7 to $7.30 just to cover costs, according to Launceston businessman Don Cameron.
Most cafes survive on food and add-on sales, not coffee. Cameron, who owns three hospitality businesses, says conditions are the worst in his 50 years.
Hospitality owners report customers spending less frequently; many use overdrafts to survive winter.
- $7
- Coffee price
- $2
- Production cost for 6 oz
- $7 to $7.30
- Break-even price
- 50 years
- Don Cameron tenure
Why it mattersExplains why your local cafe must charge premium prices and why they rely on food, not coffee, to stay afloat.
AustraliaAustralian cafe workers may face cuts in hours or jobs as owners fight to stay profitable; regulars may see menus shift toward food.
✓ Claims checked against the source. checked 2 h ago
