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Unlocking Cup of Coffee Profits in 2024

  • 3 min read

Did you know that in 2023, each cup of coffee was yielding a staggering 80 percent in profit? Coffee, particularly espresso, isn’t just a drink; it’s a major revenue driver for cafés and a powerful word-of-mouth magnet.

In the heart of a thriving café business lies its coffee quality. Overlooked by some, espresso remains a critical aspect, with a dedicated following of connoisseurs often choosing their dining venues based on coffee excellence alone.

The Financial Breakdown of the Costs for a Cup of Coffee in 2023

With rising payroll costs for small businesses starting to pinch and increasing costs due to inflation, it seemed like the right time to revisit our cup of coffee financial breakdown.

  • Coffee cost1: $0.35
  • Milk2: $0.25
  • Take-away cup and lid: $0.15 – $0.25
  • Labour3: $1.90
  • Total cost: $2.65 – $2.75
  • Average price of a coffee: $3.50 – $7.00
  • Net Profit: ($0.85 – $4.25 per cup) 24% – 60%
  1. Based on coffee bean price of $35.00/kg and 10gm per serve
  2. Average cost of regular and specialty milks
  3. Based on labour rate of $32/hr
10gms of coffee in a coffee cup profits

Increasing Your Cafe Profits without Overhauling Your Menu

As you can see, the substantial increase in labour costs is having a big impact on the profits possible in a cafe business.

However, these figures also suggest a significant opportunity to boost your café’s profitability, and it doesn’t require an elaborate menu overhaul.

When we talk to most coffee shop and cafe owners about how many extra coffees they could be selling per day, most will tell us that increasing coffee sales is easily “do-able”.

Increasing Coffee Sales to Increase Profits

Let’s imagine that your 5 day week cafe currently does 1,000 coffee sales a week – daily that’s 12 Small, 40 Medium, 132 Regular and 16 Large coffees (aiming for an extra 50% in coffee sales each day).

Coffee SizeDaily Increase
(# cups)
Weekly Increase
(5 days)
Net Profit/CupWeekly Coffee UsageWeekly Net ProfitAdditional
Annual Net Profit
Small
(90ml) 6%
630$2.70300gm$81$4,212
Medium (160ml)
20%
20100$2.701kg$270$14,040
Regular (200ml)
66%
66330$2.703.5kg$891$46,332
Large
8%
840$2.70400gm$108$5,616

For this example, that’s a total increase to your annual profit of $70,200.

In Australia a popular cafe in a capital city will average between 1,000 – 2,200 coffees per day, so even a 10% increase in coffee sales will result in annual profits of $730,080 – $1,544,400.

Having this knowledge means that, annually, you could be increasing your café’s profit substantially, just by enhancing your coffee offerings.

Discover more invaluable strategies when you work with a Cafe Coach.