Coffee Prices on the Rise – Your Business Must Keep Pace

The coffee C has increased substantially this year.  It is due to the rising C contract – the base price for most coffees, and, it is also due to the rapid rise in ‘differentials’ – the component of coffee prices that represent the quality of the coffee. 

To keep it short and to the point.  Managing your business in times like these is not easy but you must keep pace with price increases.  I was born in 1945 and so have experience with several periods of rapid inflation.  You may not remember or know, but the prime rate was over 20% in the seventies.  Nixon, Ford and Carter were Presidents.  Ford wore buttons with the initials WIP – Whip Inflation Now.  Nixon slapped price controls on the American Economy.   The inflation was caused by the huge increase in Government spending for The Great Society and other stuff, and the Vietnam War.

Today we have the Iraq and Afghanistan Wars and Government gone wild.  This is not a political statement for either Democrats or Republicans.  Both share in the economic carnage caused by incredible increases in the debt load.  Bush increased it by 3 Trillion and more and Obama at least that much, some inherited, but none-the-less, on his watch.

My concern is that interest rates are as low as they can go with nowhere to go but …. up.  Inflation may lead the way, or it may follow rates up, but I think we are in for many increases in prices.

So keep watch and keep moving your own price.  You have to maintain margins.

Bob Johnson