Coffee bean sales strong despite rise in cost

MISSOULA- The perfect mixture of market factors is sending a jolt to the java world.

Missoula's Butterfly Herbs owner Scott Laisy has been with the business for 30 of its 39 years and said this price hike is quite significant.

"I've been informed of two different price increases in the past six months," Laisy said. "They involve speculation in the coffee commodities market, some crop failure and the value of the dollar."

Butterfly Herbs buys beans from about five different roasters on a weekly basis. Last November the shop sold an organic Bolivian blend for $11.55/lb. That same blend went up to $11.95/lb. in December and since March is selling for $12.65/lb.

Laisy said he has a hard time raising the prices.

"I actually stress on that when I have to do that, but it has worked well for us this time with doing these moderate increases that were absorbed fairly well by everybody," Laisy said.

Retailers are raising prices because roasters have had to raise theirs. Black Coffee Roasting Company in Missoula has only been in business a year, but has already had to make weighty business adjustments.

"We've certainly seen, not quite a double in price, but pretty close to a double in some of the beans we buy," Black Coffee Roasting Company co-owner Matt McQuilkin said.

With the cost of beans going up that much, roasters are feeling the heat. It leaves them no choice but to pass on the increase to retailers.

"We absorbed the price for six months of the cost of increasing beans, but then it got to a point where we just had to say, you know, we have to raise our prices," McQuilkin said. "After awhile if you don't increase your prices, you're just losing money."

Spokane's Cravens Coffee has done the same. Owner Simon Thompson said the last increase of this magnitude was in 1997, but the economy was stronger then.

"What makes this a greater challenge for every roaster is that you've got rising cost of goods in a struggling economy," he said. "That's what makes this unique."

But Cravens Coffee will not sacrifice coffee for savings. Instead, they will look to other parts of the business to streamline.

"Quality always prevails," Thompson said. "The worse thing we can do is start saying, ‘Okay, how do we buy cheaper coffee?' Because that's not who we are."

Even though coffee drinkers might not love the higher prices, they're willing to swallow the extra cost.

"I have seen no slow down in sales at all on coffee," Laisy said.

"Even if it keeps going up, I'm gonna still pay for it," McQuilkin said. "Because really, when you think about it, per cup, it's a pretty small price to pay."

Coffee addicts will pay what their charged to stay charged.

"It's the most affordable luxury in the world," Thompson said. "Unfortunately we cannot drink the best of champagne every day for breakfast, but you can drink the best coffee in the world every day."

"When I go to bed at night I dream about the cup of coffee that I'm gonna have in the morning," McQuilkin said.

While Butterfly Herbs has increased its whole bean prices, its coffee house menu remains the same. You can still get a bottomless mug of coffee for $1.

Source: http://www.kaj18.com/news/coffee-bean-sales-strong-despite-rise-in-cost/