Starbucks Profitability Overview
Starbucks reported selling 8 million cups of coffee in a single day, 500 cups per store. The revenue margin per cup is 75%, equaling $138 per day per store. The cost to make a cup of coffee is $1, including $0.01 per employee for direct labor. As a higher-end brand, Starbucks’ markup is 80%.
Many wonder how profitable Starbucks is. Using a formula, we can calculate their profit margin versus competitors on equal sales. Starbucks earns an average of $3,000 daily from 15,000 company-owned stores, over $100 million if all licensed stores did the same.
Starbucks’ reported profit is $108,000 annually per store, but their actual margin is likely higher, with $650-750K revenue per location. In 2020, Starbucks had $23.5 billion total revenue, down 11% year-over-year. Operating cash flow was $1.6 billion.
Starbucks sells over 14 billion cups of coffee annually, about 6 per person daily including other beverages. So they serve around 4 billion cups of coffee yearly. Customer volume impacts these numbers more than other factors.
Starbucks has over 33,800 stores in 80 countries serving 70 million weekly customers. Most revenue comes from company-owned stores. Overall in 2022, Starbucks makes money through: company operated store sales, licensed store revenue, and other streams. Company store sales are the majority.
In conclusion, Starbucks is extremely profitable. Through thousands of global stores serving millions of customers per week, Starbucks dominates the high-end coffee market.
Profit Margin per Cup of Coffee
- What is the profit margin per cup of coffee?
Starbucks sells over 14 billion cups of coffee annually. That’s about 6 cups per person daily including other beverages. So Starbucks serves around 4 billion cups of coffee every year. Starbucks has over 33,800 stores in 80 countries serving 70 million customers weekly. Customer volume impacts these numbers more than other factors. Starbucks earns an average of $3,000 daily from 15,000 company-owned stores. Starbucks earns over $100 million if all licensed stores did the same. Starbucks reported selling 8 million cups of coffee in a single day. That’s 500 cups per store. The revenue margin per cup is 75%. That equals $138 per day per store. The cost to make a cup of coffee is $1. Starbucks’ markup is 80%. Starbucks’ profit margin versus competitors on equal sales can be calculated using a formula. Most of Starbucks’ revenue comes from company-owned stores. Overall in 2022, Starbucks makes money through store sales, licensed store revenue, and other streams. Starbucks dominates the high-end coffee market. Starbucks is extremely profitable.
When Assessed by Margin
- What is the margin on Starbucks coffee?
Starbucks sells over 14 billion cups of coffee annually. The margin per cup is 75%, equaling $138 revenue daily per store. Starbucks’ markup is 80%. The cost to make one cup is $1. Starbucks earns $3,000 daily from 15,000 stores. That’s over $100 million total if all licensed stores did the same.
Starbucks reported $23.5 billion total revenue in 2020, down 11% year-over-year. Operating cash flow was $1.6 billion. Starbucks has 33,800 stores in 80 countries serving 70 million weekly customers. Company store sales are the majority revenue stream. Starbucks dominates the high-end coffee market and is extremely profitable.