Starbucks Raising Prices To Offset Raising Dairy Prices
July 24, 2007 – 9:23 amIf you're new here, you may want to subscribe to my RSS feed. Thanks for visiting!
Starbucks (SBUX) recently announced that they are planning on raising the prices on some of their caffeinated beverages by an average of about .09 cents a cup. This will represent the second price increase for their products in less than a year.
Company officials stated that raising costs of dairy products and other commodities are the reason for the price hike.
Last month the Chief Financial Officer announced that the company would be ‘very challenged’ to meet their 2007 earnings forecast.
“We’re always looking at the business costs, and given the rising cost environment in which we operate, we think this is an appropriate time,” spokesman Brandon Borrman said.
The price increase becomes effective on July 31, 2007 at over 6,000 company owned stores in the United States and will not affect whole bean or food items. Licensed stores control their own pricing, but are expected to follow suit in the price increase.
Starbucks stock rose by .47 cents at market close on Monday.
If you enjoyed this post, subscribe to the Superior Investor Blog RSS feed!.
