If you’ve noticed that your caramel macchiato or iced latte was pricer than usual in recent months, you might be onto something. As reported by The Hill, Starbucks announced on February 1st that it will be increasing the prices of its products in 2022. The chain cited rising inflation, supply chain disruptions and increasing labor costs as reasons for the price changes in the statement by the company.
Starbucks notably missed its projected quarterly profit as the Omicron variant of COVID-19 swept across the world. This caused plenty of coronavirus-related restrictions, like increased labor shortages in China, Starbucks’ fastest-growing market.
This move, as the New York Times reports, is the second time in a four month span that the company has amped up its prices. You might recall in October 2021, customers saw increased costs for the chain’s beverage and food items. According to Starbucks executives, they will only increase from there in 2022.
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“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,” said Kevin Johnson, Starbucks president and CEO. In its statement, the company wrote that it 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 workers, the company raised wages and benefits for employees last October to address labor market conditions. The chain increased COVID-19 pay for workers, which includes paid time off for employees who get sick from it and workers are also paid to get vaccinated against coronavirus.
According to the the Times, Starbucks chief operating officer John Culver said that the recent price hikes didn’t make “any meaningful impact to customer demand,” but Starbucks customers on Twitter don’t seem to be pleased with this price changing news. Many tweeted that while they are “happy employees are being paid fairly,” they might “take their business elsewhere” as in local or small business coffee shops due to the chain’s rising prices.
