There’s life before being a small business owner, and life afterwards. Before I owned a cafe, I was just like most people, outraged by rising coffee prices, weekend surcharges and making my own avocado toast at home.
Like any industry, once you’re in it, your whole perception of that world changes. Suddenly, you understand the costs, the pressures, the reality of what it takes to keep the wheels turning.
This week, an article came up in my feed titled “we should all be paying more for our coffee, or the days of independent cafes will be gone”.
It was a welcome change to the usual coverage we get about our coffee habits, like millionaires calling workers “idiots” for buying a daily coffee.
The article highlights the fact that on a global scale, Australian coffee prices are much cheaper. In London, average coffee prices have surpassed £5 (AU$9.92), due to spiralling costs and an affected coffee harvest. In New York, it’s about the same at US$6.50 (AU$9.91).
I “gently” shared the article to our 18,000 Instagram followers, in the hope that it would either educate those not in the know or inspire some compassion. It also, unsurprisingly, inspired some debate.
Cafes seem to bear the brunt of financial criticism – it’s always your daily coffee keeping you from buying a house, not big businesses like banks, insurance and energy achieving record profits at the expense of everyday Australians.
We’ve all been hoodwinked by multi-national convenience stores and supermarket giants that $1.50 is a reasonable price for coffee (even their prices have gone up) and you can get a pack of four croissants (an artisanal item that takes three days to make by our bakery supplier) for $2.85.
Big businesses that have the luxury of huge bulk buying and the ability to push loss leaders in a way that your local corner store can never do, have created a false perception of what someone feels is a reasonable price to pay.
Additionally, we have our Prime Minister in our social feed, holding up two coffees and lamenting that paying 10c more for one due to “excessive card surcharges” isn’t right – he’s pledging to ban card surcharges on debit cards. Our POS system charges us 1.6% on every credit card or debit card transaction – that’s $8,000 on an average cafe bringing in $500,000 per year.
Why are business owners being banned for trying to recoup their costs, and not the big banks and credit card processing fees being targeted?
One fellow cafe owner replied to my post, sharing that on average at their shop in the last 12 months, their water and electricity bills had doubled, the price of milk and packaging has gone up, rent, wages and waste disposal costs have increased and suppliers as a whole have increased their own prices from 30-60%.
Another replied, “every cost is going up, many of which guests don’t see…insurance, utilities, software, boring things like grease trap cleaning”.
“The price of most items should be about 20% more but in a climate where people are already visiting less frequently, that’s an impossible thing to do.”
“At best, most venues are breaking even each week with a lot of unpaid labour from owners.”
These increases across every aspect of a small business, as a collective, become a deluge that is hard to keep at bay.
Can the average Australian make a decent coffee at home? Absolutely. The modern standard of home equipment, access to quality coffee beans and ability to learn how to brew to an expert level on YouTube means that with enough of an investment, you will come close to what a cafe can do for you. You’ll also save some money in the long run.
But as one of our regular customers said to me, “I’m not just buying a coffee. I’m buying a great conversation with the people in our community. A $1 [convenience store] coffee doesn’t have the second bit”.
Maybe buying a coffee is more than just getting a great-tasting brew. Maybe it’s an investment in your neighbourhood, in a third space outside your home where you can cross paths with locals, have someone brighten your day, and contribute to creating a thriving lifestyle in your surroundings, all while supporting the little guys.
And that’s worth more than $5 a cup.
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Chryssie Swarbrick is a writer, small-business-juggler and mum of two. She is currently documenting her adventures in opening a cafe, Two Franks, opposite her childhood home.
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