• christophergribbon

Is your flat white expensive? Or insanely cheap?

When you're forking out around £3 for a cup of coffee it's easy to think coffee shops must be making a fortune. However, by breaking down the price of your coffee into it's component parts, we hope to show why that's not necessarily the case!


The following breakdown is based on a Crumbs Flat White. All figures are approx. and it goes without saying that these will vary across cafes (chains vs independents) and geographies, where rent and labour costs can vary significantly.


Full Disclosure(!), after almost finishing this post I came across a video by UK coffee expert, James Hoffman on his YouTube channel which does a way better job at explaining this topic than I do! It's definitely worth checking out if you're interested in this kind of stuff! https://www.youtube.com/watch?v=7SM2Jrot-ZM


Crumbs Takeaway Flat White

Gross Revenue

£2.60

VAT

£(0.40)

Net Revenue

£2.20

Coffee

£(0.40)

Milk

£(0.20)

Cup & Lid

£(0.20)

Gross Margin

£1.40

Rent

£(0.30)

Labour

£(0.50)

Other Overheads

£(0.25)

Net Profit

£0.35



Let's take a look at each element in turn;

VAT

Currently charged at 20%, a large chunk of the retail price goes straight to HMRC, not the cafe owner. This is exactly why the recent reduction in VAT rates during the Covid pandemic provided a lifeline for many hospitality firms.

Coffee

Milk

Cup & Lid

Overheads





40 views0 comments

Recent Posts

See All

Our first post is all about alternative milks. It seems like less than a decade ago if you wanted an alternative or non-dairy milk you had to go to a niche health food shop and choose between soya mil