Starbucks Hikes Some Prices

Starbucks Corporation (NASDAQ: SBUX) will increase the prices of some of its beverages by 5 cents to 20 cents on Tuesday. The Seattle-based company has raised prices nationally, last month, where the rates are far surpassing the rest of the U.S. locations.

Lisa Passe, a spokeswoman, said in the statement that Starbucks persistently evaluates pricing in order to balance the requirement of doing business profitably and also offer value to their loyal customers. However, Starbucks officials said that the prices of some of their most popular coffee beverages, including the Frappucino and the Grande Brewed Coffee will not be altered. Coffee futures traded at around $1.25 a pound on Monday.

The company says the price hike is due to coffee and commodities costs, as well as expenses such as rent, labor, marketing and equipment. The only surprise is that Starbucks did not think it could raise the price of its bagged coffee.

Swallow these numbers along with your double shot: Starbucks in April reported $4.6 billion in second-quarter revenue, an 18 percent increase from the previous year’s quarter. Starbucks, though, says that the decision isn’t the result of one single thing, but many different factors.

In fact, the J.M. Smucker Company reduced the cost of its Folgers and Dunkin Donuts coffee brands by six per cent in the United States.

Starbucks, which added 600 new stores a year ago to its already 20,000-plus stores, is the U.S.’ largest coffee shop chain.