Let's start with the maths.
A café serving 200 coffees per day, five days a week, fifty weeks a year, is serving 50,000 coffees per year. A 10p increase on each of those coffees is £5,000 of additional revenue per year — with zero increase in cost of goods.
Now factor in that most cafés sell a mix of drinks ranging from £2.80 to £4.50, and a 10p increase doesn't apply uniformly to every drink. A more realistic blended figure might be 7–8 transactions affected per order cycle, some with food. A modest, well-applied repricing exercise often produces closer to £7,000–£9,000 of additional annual gross profit for a café of this size.
That's not a rounding error. That's a part-time staff member.
Why Cafés Don't Do It
The fear of losing customers to a price increase is real — but it's consistently overestimated.
Price sensitivity research in the hospitality sector suggests that customers tolerate price increases of 5–10% without significant volume impact, provided the experience justifies it. For a £3.80 flat white moving to £3.90, the increase is 2.6%. For a customer who visits twice a week, that's 20p a week, or roughly £10 a year.
The customers who leave over 10p are, in the vast majority of cases, not the customers who are driving your revenue.
What customers do respond to is a price increase that arrives without context, feels sudden, or isn't supported by a quality experience. A 10p increase at a café that's gotten worse is a problem. A 10p increase at a café that's gotten better — or simply hasn't raised prices in three years while costs have risen 15% — is overdue.
The Cost Side of the Equation
If you haven't raised your prices in 18 months, here's what's probably happened on your cost side:
- Milk has increased 10–20% across most of 2023–2025
- Green coffee / roasted wholesale prices have risen meaningfully with global supply pressures
- Wages — minimum wage has increased significantly, and market rates for experienced baristas have moved with it
- Energy — commercial energy tariffs for a café (refrigeration, espresso machine, dishwasher) are substantially higher than pre-2022 levels
Your margins haven't stayed the same while you've held the price. They've been quietly compressed.
The business case for a price review isn't greed — it's arithmetic. If your cost base has risen 12% and your prices have stayed flat, your actual profitability has declined by more than you probably realise.
How to Apply a Repricing
The most effective approach isn't "increase everything by 10p." It's more surgical:
1. Identify your highest-volume items first. Your top five selling drinks should be your primary focus. A 10p increase on a drink you sell 80 times a day has more impact than the same increase on a drink you sell 10 times.
2. Reconsider your alt milk surcharge. Many cafés are running at cost on oat milk and other alternatives. Review this independently of your base pricing.
3. Round to psychological price points. £3.85 is a worse price than either £3.80 or £3.90. The marginal saving doesn't register; the awkwardness does.
4. Don't discount your increases. "Special offer: flat white for £3.80 this week only" signals that your actual price is too high. Price with confidence and hold the line.
5. Communicate where it helps. You don't need to announce a price increase, but if you have loyal regulars who'll notice, a brief, warm acknowledgement ("We've adjusted our pricing for the first time in two years — our costs have moved and we want to keep the quality up") is better than silence.
The Confidence Problem
The deeper reason most café owners delay repricing isn't financial — it's psychological. Setting a higher price feels like a claim. It feels like saying "we're worth this." And that vulnerability, especially for a new café still finding its footing, is uncomfortable.
But the reverse is also true: pricing below the market for your quality level sends a signal. It suggests uncertainty. Customers in the middle of the specialty coffee market are often more confident in a café that prices with assurance than one that seems to be apologising for its prices.
A properly structured menu engineering review isn't just about adding 10p here or there — it's about building a pricing architecture where every item is earning its place, and you know exactly what your margins are at every volume level.
The £7,300 Year
Run this for your own café:
- How many coffees do you sell per day?
- What's your current average transaction value?
- What would 10p more on your top three sellers produce annually?
The answer is almost always larger than you expect. And the decision is almost always less risky than it feels.
Price what you're worth. The maths is on your side.