Latte Pricing Question- Double Shot vs Quad!

[arthurlaw]

Hey, I run a small cafe in Oregon and am trying to price lattes accurately.

My milk cost is around .0492 per oz
My coffee cost is about .0233 per gram

So an 8oz lattee is:
Milk with waste: .39 cents (8oz milk)
Coffee with waste: .46 cents (20g but actually pull 17g shots)

At a food cost of .33 the latte should be priced at $2.61.

However for a 16oz latte (since it gets a quad) the coffee price:
40g coffee: .93 cents
20oz Milk: .984 cents

So it should be priced at: $5.75 or so.


This doesn't make sense to me as customers are essentially paying for two lattes and the calculating system doesn't allow for an exponential growth of cost. If a 16/20oz L get a quad and an 8/12oz get a double then the price of a 12 is $3.21 and if you add a shot and 4 oz of milk it goes to $4.79.

Is there a system you could recommend to calculate accurately or is this all normal?

Thanks for the help!

 

[Musicphan]

Your 8oz latte is using 8oz of milk... why is your 16 oz latte using 20 oz milk? Considering you are pulling quad 1oz? shots your looking at about 12oz of milk (plus waste). I also don't see the cost of your cup/lid/sleeve in the equation as well.

 

[topher]

Quick question...why are you paying over $10 a lb for wholesale coffee?

 

[arthurlaw]

Sorry, the 20oz of milk was a mistake, should read 16oz, so more like .78 cents in cost.

The shots are equal to 1.5oz so I suppose I should price milk at 13oz...

As for cup/lid/sleeve/etc, we have a .25 to go charge but most people stay here.

 

[arthurlaw]

The 10/lb wholesale is because it is organic but we roast in house so the cost is closer to $5 but we price it in our system at 10/lb to insure that the cafe is self sustainable and the roaster doesn't have to support the cafe. This is all new to me as I just took over managing so if it sounds absurd please let me know!

 

[John P]

Pricing Question and What is your value add ?

Arthur,

I decided to post a video to address what is a deeper issue with your pricing scenario.

What is your value add? Why is it important? What does it communicate???