Your caramel macchiato or iced latte might have been more expensive than usual in recent months.
As reported by The Hill, on February 1st, Starbucks announced that its prices would increase in 2022.
According to the company, price increases were attributed to rising inflation, supply chain disruptions, and rising labor costs.
The coffee giant missed its projected quarterly profit due to COVID-19’s Omicron variant spreading around the globe. As a result, Starbucks faced plenty of coronavirus-related challenges, including an increased labor shortage in China, the company’s fastest-growing market.
As the New York Times reported, the company has increased its prices twice in the past four months.
Customers may recall that the cost of beverage and food items increased in October 2021.
The price increases will continue in 2022, according to Starbucks executives.
“Although demand was strong, this pandemic has not been linear and the macro-environment remains dynamic as we experienced higher-than-expected inflationary pressures, increased costs due to Omicron, and a tight labor market,” Starbucks CEO Kevin Johnson said, as stated on Shefinds.
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According to its statement, the company is “taking additional pricing actions planned through the balance of the year to mitigate cost pressures, including inflation” as it looks to position its “business for the future.”
As for Starbucks employees, the company raised wages and benefits last October to address the labor shortage.
COVID-19 pay for workers increased at the chain, which includes paid time off for workers who get sick from it, and workers who get vaccinated against Coronavirus are paid.
John Culver, Starbucks chief operating officer, told The Times that the recent price hikes did not have “any meaningful impact to customer demand,” however Starbucks customers on Twitter do not seem pleased with the price hikes. Several Twitter users said that while they are “happy employees are being paid fairly,” they might “take their business elsewhere” if the chain’s prices continue to increase.
