Other costs, including labour, rent and milk, continued to rise, says Corney who last year infamously warned New Zealanders $10 coffees were coming.<\/p>\n
And in 2026? <\/p>\n
\u201cThe reality is, that for a cup of coffee in the cafe, we should be charging $10.50 for a regular flat white. That\u2019s what rational economics says. But we\u2019re obviously not … we\u2019re not there yet.\u201d<\/p>\n
The Flight Coffee Hangar cafe currently charges $6.80 for a \u201chave here\u201d flat white. Corney says that would increase to $7 from May 1 as he anticipated absorbing costs associated with Government policy changes around payWave charges.<\/p>\n
\u201cIf you\u2019re not paying $7 a cup, then the maths, all the numbers over the last 20 years in terms of all other input costs increasing, means it is being subsidised. That\u2019s the cold, hard truth, whether you like it or not.\u201d<\/p>\n
There had been an industry \u201creckoning\u201d says Corney, as cafe owners baulk at high rents (often driven by \u201cskyrocketing\u201d insurance premiums), more customers choose to buy home coffee machines and younger customers shun the traditional.<\/p>\n
At The Flight Coffee Hangar, younger customers are increasingly choosing expensive specialty drinks like the banana bread latte (left) and Mont Blanc coffees. Photo \/ Mark Mitchell<\/p>\n
Sales of drinks made from matcha (a finely ground green tea) are \u201cthrough the roof\u201d. Specialty coffees like Hangar\u2019s $14 Mont Blanc \u2013 vanilla and hazelnut cold drip with a crown of cream, nutmeg and lime zest \u2013 and a banana bread-flavoured latte are increasingly popular.<\/p>\n
\u201cPeople are discovering what they want to pay \u2013 and what they don\u2019t want to pay,\u201d says Corney.<\/p>\n
\u201cGen Z and Gen Alpha will pay $10 for a matcha and not bat an eyelid, whereas I can\u2019t grind fresh coffee, steam, fresh milk, pay someone a living wage, and charge $10 without someone having an absolute conniption.<\/p>\n
\u201cWe sell more banana bread lattes at $8 than we do cappuccinos for $6.80.\u201d<\/p>\n
But Corney says operators have to find ways to relate to these emerging markets.<\/p>\n
\u201cGone are the days of the latte bowls. This isn\u2019t 2003.\u201d<\/p>\n
Cafe owners are fearful of price increases because they believe they could lose business but, according to Corney, \u201cthat\u2019s an irrational argument \u2013 even if you put your prices up 50%, and you lose 10% of your customers, you would still be more profitable\u201d.<\/p>\n
Corney says the price of a flat white in his own cafes has increased by 100% (from $3.50) over the past 20 years. Meanwhile, the minimum wage has increased 134%, and Hangar (where the base salary is the $28.95 per hour Living Wage) lease costs have doubled since opening.<\/p>\n
\u201cA flat white is not just beans and milk. It is the wages of skilled staff, training and retention, equipment and maintenance, rent and fit-out amortisation, compliance, insurance and utilities, and the time and space to serve customers quickly and well.<\/p>\n
\u201cWhen people say coffee is too expensive at $6, what they are actually saying is that coffee has been underpriced for so long that $6 feels expensive. Those feelings do not match economic reality.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"Other costs, including labour, rent and milk, continued to rise, says Corney who last year infamously warned New…\n","protected":false},"author":2,"featured_media":299198,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5],"tags":[164522,95334,68881,138,48706,17379,4187,4381,36979,42636,9639,84125,9097,111,139,69,164523,9366,37410,84768,164521,312,3271,57816,107,8238,52,16550,5264,6730],"class_list":["post-299197","post","type-post","status-publish","format-standard","has-post-thumbnail","category-business","tag-164522","tag-banana","tag-bread","tag-business","tag-cafes","tag-coffee","tag-cost","tag-customers","tag-drink","tag-evolve","tag-flat","tag-lattes","tag-must","tag-new-zealand","tag-newzealand","tag-nz","tag-outspoken","tag-pricing","tag-rather","tag-rational","tag-roaster","tag-says","tag-should","tag-survive","tag-then","tag-under","tag-wellington","tag-white","tag-whites","tag-would"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts\/299197","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/comments?post=299197"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts\/299197\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/media\/299198"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/media?parent=299197"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/categories?post=299197"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/tags?post=299197"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}