Starbucks is raising prices for its popular coffees for the second time in three months, CEO Kevin Johnson said, blaming soaring inflation.
And more price hikes are on the way this year at the coffee chain as labor, transportation and supply costs continue to rise.
“We have additional pricing actions planned through the balance of this year, which play an important role to mitigate cost pressures, including inflation, as we position our business for the future,” Mr. Johnson told analysts and investors during the company’s quarterly earnings call on Tuesday.
Still, he said consumer demand has increased despite the price hikes, as Americans begin returning from their COVID-19 hiatus.
“There is a pent-up demand for Starbucks and for people wanting and longing to return to their normal routines,” Mr. Johnson said, according to USA Today.
In addition to the price hikes, some Starbucks locations began scaling back their hours last month because of staffing shortages.
Mr. Johnson said the company hired more workers than expected last quarter, but that keeping workers has been a challenge because of the coronavirus pandemic.
“The highly transmissible omicron variant amplified staffing shortages in our supply chain, resulting in higher-than-planned distribution and transportation costs,” he said.
The lack of staffing prompted Starbucks to give its employees a raise in October. All U.S. workers will make between $15 and $23 per hour, the company said.
Still, that hasn’t stopped workers at dozens of its locations from trying to unionize.
On Friday, workers at the Lake Lansing Starbucks in Michigan filed for a union election with the National Labor Relations Board, according to the State News, the Michigan State University newspaper.
The shop joins at least 50 other Starbucks locations, following the unionization of a Starbucks in Buffalo, New York, in December.
• Peter Santo can be reached at psanto@washingtontimes.com.
Please read our comment policy before commenting.