Why Do Cafes Charge More for an Iced Latte than Regular Coffee?

VenusDeMilo on 13/03/2021 - 09:59

My usual order at a cafe is a latte. On hot days I sometimes go for an iced latte (shot of espresso, ice & milk. Not to be mistaken for an iced coffee with ice cream etc.)

Most cafes charge an extra 50 cents or a dollar for this which doesn’t make sense to me.

I get that ice costs a minimal amount of money but by putting ice in less milk is required but most importantly milk is not required to be frothed which to me seems like the most labour intensive, skilled part of the baristas job.

What are your thoughts on this?

Food & Grocery Coffee

Comments

  • Halo375 on 13/03/2021 - 10:20
    +17

    Because people are prepared to pay for it at that price. Pricing is not all about cost.

    • VenusDeMilo on 13/03/2021 - 10:58

      Yeah I think that answer makes most sense!

      The customer is already in the store, if it’s really hot I’m going to buy one regardless and if I’m feeling frugal I’ll still get the regular latte.

      Maybe if it was a competitive strip of cafes and one didn’t charge more for iced lattes compared to others they’d attract more business but most people, myself included are pretty loyal to their preferred cafe.

  • Jimothy Wongingtons on 13/03/2021 - 10:21
    -1

    It’s slightly more work to do a iced drink?

    • 87percent on 13/03/2021 - 10:23
      +5

      Is it? Your don’t need to warm up the milk (for a latte). Isn’t it just a shot of coffee, milk, ice (some places put ice cream)

      • Jimothy Wongingtons on 13/03/2021 - 10:26
        +7

        Someone gotta prep the ice?

        *edit what sf3 said.

        If you can think of a better idea of getting ice than going to Antartica I’m sure the team would like to hear it -they lost 4 men in the last expedition!

    • Quasi Human on 13/03/2021 - 10:37
      +2

      It's actually less work. Pull shot of coffee, add ice and milk. Where as with a normal coffee you need to foam the milk which takes more time and effort.

      I think it's more that people will pay extra so why not charge extra.

      Also they would have ice stored anyway for other drinks so no extra impost of storing ice.

  • SF3 on 13/03/2021 - 10:23
    +7

    Ice takes up room in freezer and cost of keeping it frozen.

    • dmbminaret on 13/03/2021 - 12:08
      +1

      Ice takes up room in freezer and cost of keeping it frozen.

      Not with an ice machine, but year, overheads on that machine.

  • elgrande on 13/03/2021 - 10:26

    Different market.

  • kiitos on 13/03/2021 - 10:56
    +2

    I've seen a similar situation with tea - a cafe I went to charged $5 for tea, consisting of a small pot of hot water with a tea bag hanging out, and a small jug of milk. I don't understand how that could be worth that much more than a milk coffee.

    • VenusDeMilo on 13/03/2021 - 11:00
      +4

      Yeah I’d never order a tea out for this exact reason. I’m perfectly capable of boiling water myself where as I can’t make a barista level coffee at home.

      • nubzy on 13/03/2021 - 12:45
        +2

        Well you can, you just need a decent machine + grinder, fresh beans and a bit of basic knowledge. I hardly ever buy coffee out these days, waste of money and half the cafes make a terrible cup of coffee.

    • vikvance on 13/03/2021 - 15:36
      +2

      I don't understand how that could be worth that much more than a milk coffee.

      It's because people (like me) are willing to pay for it.

      I don't like coffee, and prefer tea, and if I'm meeting a friend at a cafe, then I'm happy to pay the $5 and get the tea, instead of buying something I don't like.

      The reason I'm there is to meet the friend, and not for drinking a hot beverage, and $5 seems an OK price to pay for a nice chat with a friend in a nice cafe.

  • Porker on 13/03/2021 - 10:57
    +8

    Bottled water in some cases costs more than a bottle of coke.

    Demand drives price too.

  • JimmyF on 13/03/2021 - 11:06

    I get that ice costs a minimal amount of money but by putting ice in less milk is required

    Are the glasses the same size? A latte normally comes in a smaller glass to a iced Latte…..

    • 87percent on 13/03/2021 - 11:13
      -1

      Yeah that’s what my reasoning would be. Normally, the glasses are a lot bigger

      But side note, why not just go to 7-11 and get an ice coffee? They’re actually pretty decent

      • VenusDeMilo on 13/03/2021 - 11:21

        No 7-11 near my work but will keep an eye out and try one out of curiosity when I can!

    • VenusDeMilo on 13/03/2021 - 11:21

      Usually get take away and use a keep cup but have noticed they use same cup as for normal coffees for those not using keep cup.

  • dmbminaret on 13/03/2021 - 12:09

    Plastic cup vs paper cup?

  • This Guy on 13/03/2021 - 12:50
    +2

    At only 50c to $1 it is raw materials. Plastic hot drink cups are slightly more expensive that paper. Iced drinks will often come with a shot of syrup which is usually a surcharge in a hot drink. A small surcharge like this covers those costs.

    Some places will charge significantly more. They might be using more premium supplies, be accounting for lost efficiencies from moving between a coffee machine and a blender, costing more of the setup cost to these drinks (commercial blenders can be a few thousand for the pretty ones and they might only make 1000 iced drinks in a year), pricing it more in line with other cold drinks like soft drink, thick shakes and milk shakes or just be taking advantage of their location and desirable decor.

  • slknv on 13/03/2021 - 13:25

    Many many ways to set a price. eg
    1) Add up all materials, labour, apportion fixed & other variable expenses, add a profit margin. (boring but one way to set a baseline price on a product/service)
    2) Charge as much as you think someone will pay. eg $1000 for some wheels for your apple computer confused face emoji
    3) ….? profit (something something underpants gnomes)

  • lette on 13/03/2021 - 20:23
    +1

    Milk comes in a bottle and only needs to be steamed. That's a small machine that needs cleaning and low maintenance.
    Ice is made from a giant f off machine with a compressor and needs much more time to clean. Also costs a lot more. Breaks more often. Transporting ice from the machine to the coffee bay takes time and equipment. Putting milk in the fridge is not the same. If you even accidentally cross contaminate that ice the whole thing needs to be emptied cleaned and started again. This happens more often than you'd think.
    The space of an ice machine is more than a milk steamer. Or milk for that matter, if your stock control is en pointe.

    Ice costs more than milk really.

    • bobwokeup on 13/03/2021 - 23:50
      -1

      Ice doesn’t cost more than milk it’s frozen water. They would need to store other items in a freezer so the cost of running it is not a big cost and they wouldn’t need that much ice as less people order it.

      • lette on 14/03/2021 - 14:38

        What freezer? A freezer is seperate. An ice machine and ice bay are different things to a freezer. Milk deliveries are Daily. Have you ever owned a cafe?

      • lette on 14/03/2021 - 14:39

        And not pr litre no. But ice costs more due to labour overheads opportunity loss due to space etc. Milk. Is milk. You get it delivered daily and load it into the fridge. That's it. One flat cost.

        • bobwokeup on 14/03/2021 - 20:38
          -1

          Freezer to store the ice. How do you know they don’t have one of those freezers that make ice? Or use trays to make ice. They wouldn’t exactly need that much ice!!

          • lette on 15/03/2021 - 00:13
            +1

            @bobwokeup: Haha oh c'mon you must be pulling my leg! You'd need over one ice tray per iced coffee. And no places don't buy ice. If you did you'd need an INSANELY large freezer room, the likes you'd only see at 200+ dinner venues. And ice costs more than milk again. The wholesale price of milk is around $1.29 a litre. Ice isn't usually stocked by suppliers in the hospo game but if it is it's about the same if not more. Plus a seperate credit account, delivery fee and minimum spend.
            Everywhere has an ice machine. I don't think you realise but a smoothie is 70% ice. I buy two 700ml ones every morning in a queue of about ten people.
            Are you serious or pulling my leg I honestly can't tell?

            • bobwokeup on 15/03/2021 - 12:53

              @lette: Don’t know what world you are living in. Decent cafes provide good quality almond milk but you must go to the dodgy cafes and hence why you think ice is expensive 😂

              • lette on 16/03/2021 - 23:27

                @bobwokeup: The world where i own one and just spend the last day or so working at someone else's. With a coffee bay and no ice trays. Now we're talking about almond milk? You're clearly a troll and have zero idea.

                • bobwokeup on 18/03/2021 - 10:57

                  @lette: Gosh someone got defensive…I guess you think ice is more expensive than milk so that explains it 🤣

                  • Bjingo on 26/03/2021 - 17:30

                    @bobwokeup: Lette is definitely right though firstly they use something like this;

                    http://www.inhospitality.com.au/products/catering-equipment/…

                    Maybe a bigger one if 35kg a day is not enough.

                    so they need to get a specialty machine and find room to place it, then it requires power 24/7 and a direct hook up to the water plus regular cleaning and servicing.

                    and that's the only ingredient different, otherwise they are both just milk and coffee. So for iced coffee they need that whole machine as an extra.

                    Steamers are built into the coffee machine so you already have one

                    • bobwokeup on 27/03/2021 - 00:06

                      @Bjingo: Yeah that’s fair enough for bigger cafes but a coffee shop wouldn’t need something that big for the occasional iced coffee. Would have to go to Lette’s cafe, imagine how angry he gets at customers…

                      • Bjingo on 30/03/2021 - 12:19

                        @bobwokeup: If its a small enough cafe and orders for iced drinks are far and few between they could probably get away with a dozen ice trays which they use to fill a container in the freezer. At that point the extra 50 cents is probably for the f around of that.

                        • bobwokeup on 30/03/2021 - 20:48

                          @Bjingo: It’s not like they’d only use the ice for coffee though. At the end of the day it wouldn’t cost much to have ice and all up may take the same amount of effort as a hot coffee, so no reason to increase the price.

  • whapkaplit on 14/03/2021 - 00:00
    +2

    Used to work in cafes. Most charged the same as for lattes. You're right that they're less work, they shouldn't really be charging extra. If they are, it's pretty much just because they can and people will pay it.

    • bobwokeup on 15/03/2021 - 12:53

      Finally someone that gets it.

  • Grunntt on 14/03/2021 - 08:30

    Easy - next time you order one just politely ask them how they come up with their price difference.

  • Peck on 14/03/2021 - 10:17

    Maybe price comparison/matching their neighbouring cafe's

  • drongobongo on 17/03/2021 - 13:00
    +1

    Most small cafes don't have an ice machine, only a few ice trays in the freezer. So that obviously limits how many iced coffees you can sell. Better to increase the price over the normal coffee in order to preserve the ice cubes.

    During a rush, making an iced coffee would mess with my flow. I'd have to find the special cups, get the kitchenhand to put ice cubes in the cup for me and only then can I make the coffee. In that time, I could have made 2 normal coffees already.

  • fLamous on 19/03/2021 - 11:25

    Buy a regular latte and wait for it to cool down?

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