x Abu Dhabi, UAEFriday 28 July 2017

Rising prices and smaller cups leave a bitter taste for coffee lovers

Coffee shops' profits continue to be hammered by the rising cost of beans globally, which is bad news for customers. Watch video

ACoffee shops' profits continue to be hammered by the rising cost of beans globally, which is bad news for customers. ( Delores Johnson / The National )
ACoffee shops' profits continue to be hammered by the rising cost of beans globally, which is bad news for customers. ( Delores Johnson / The National )

Coffee shops across the Emirates are considering increasing prices or changing the size of their cups, as profits continue to be ground down by the rising price of beans globally.

"It looks like in the next two quarters there will be a price increase because we cannot suffer these costs increases anymore," said Caner Gursoy, operations manager for Brook Foods, the franchisee for Gloria Jeans in the UAE.

Mr Gursoy said the price of Arabica beans had increased at a rate of about 16 per cent every six months for the past three years and that, reluctantly, some of this increase would now have to be passed on to the consumer.

The price of a basket of different coffee beans has risen 35 per cent in the past year, according to the International Coffee Organisation.

Coffee and and beverage sales make up about 35 per cent of Dunkin' Donuts business in the UAE, and despite having the buying power of a global brand, coffee costs have increased 50 per cent in the past two years, according to David Rogers, general manager for Dunkin' Donuts in the UAE.

"We are considering a price rise," said Mr Rogers. "The last two years have been zero or negative growth, but the biggest problem is cost increases, it's really hurting."

Dunkin' Donuts has 60 outlets across the Emirates and has seen 12 per cent growth in sales so far this year compared to the same period last year.

But this growth has not been reflected in profits as the company actually lost money in June, July and August due to rising costs.