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Why the Hell Is Iced Coffee So Expensive? An Investigation

Yes, I am a terrible millennial, but is it so wrong to want to buy a budget iced coffee now and then?

by Ruby Lott-Lavigna
25 July 2018, 1:48pm

Photo via Flickr users Molly and Barta IV. Composite by the author. 

On these hot, summer days, when peeling your sticky thighs off furniture has become a daily ritual, nothing tastes more refreshing than an ice-cold, caffeinated beverage. As the office air con grows more aggressive and your underboob more sweaty, the only acceptable way to consume caffeine is either a very frosty can of Diet Coke or, as is more palatable early in the morning, an iced coffee.

In light of these rules of summer caffeine consumption (tea drinkers in July are objectively monsters), your options for a cool, reviving drink become limited. Just a few short weeks ago, there were endless hot coffees, teas, and infusions to get you up and ready to face the day. But now, it’s summer, and all you want to do is mainline ice-cold Americanos until you weep the caffeinated elixir.

The only problem? The expense. Suddenly, a coffee that costed you £2.20 (or free, if you made it at home) will set you back £3 at best. Not all coffee shops increase the price of their iced beverages (chains such as Pret a Manger and Costa Coffee charge the same for a latte, whether it’s hot or with ice), but many will hike the price as soon as your £2.20 coffee hits those freezing cubes.

Not only is it more expensive to fuel your caffeine addiction in the summer, but it’s also near impossible to make a not-terrible iced coffee at home or work. The odds of your office or workplace having an ice machine are low, and unless you’ve spent hours carefully watching baristas make iced lattes as they gently ask you to please step back from the counter, you’re probably shit at making them anyway.

Which means you have no option but to buy an iced coffee from a cafe and suck up the extra cost. Could you not, technically, ask of a cup of ice (free), a double espresso (cheap), and construct your own using the milk they provide? Do ice cubes, and sometimes blitzing them for three seconds, really add such a premium? Is iced coffee more expensive because baristas know that we, as people ill-equipped for weather hotter than 21 degrees, are all gagging for the delicious, bitter taste of cold coffee?

Photo via Flickr user Sergio L.A.

It is important to clarify that I do not believe buying an iced coffee—or indeed, any coffee—is a human right. Nor do I believe that coffee shop employees, who are already serially underpaid, should take a wage cut so consumers can have cheaper drinks. The issue I take is with an arbitrary extra mark-up when buying coffee out is already expensive. Considering Brits are buying up to 95 million cups of coffee a day, while also paying more than any other country for java, must we be additionally screwed come these sticky summer months?

There are many theories as to why iced coffee might be more expensive. Some say it’s the ice that does it. It requires more paraphernalia, like paper straws and plastic cups, and takes longer to make. It can be expensive to store ice, and there’s a lot of waste that comes with that. All feasible ideas. But then why do chains like Costa not change the price for the iced version? Like women’s haircuts and cupcakes, I suspect that the iced coffee premium is because we’re all pathetic, desperate sweat-balls come summer, and will willingly hand over our first borns for a cold caffeine hit.

I reached out to Markman Ellis, an academic at Queen Mary University of London and author of The Coffee-House: A Cultural History, to help me work out to what extent I was getting scammed when buying an iced latte.

Is iced coffee more expensive because baristas know that we, as people ill-equipped for weather hotter than 21 degrees, are all gagging for the delicious, bitter taste of cold coffee?

“The price of coffee is a bit of a mystery, but there's nothing about adding ice which should make it more expensive,” Ellis tells me over email. “Ice isn't expensive—it's just water, of course—and certainly not more than the milk or coffee it replaces. I suppose there might be a marginal cost in having a special ice making machine which only gets used for a few months a year. But basically, the higher price for iced coffee is just extortion: coffee chains know that when it is hot, we want iced coffee, so they rack up the prices.”

However, Ellis does explain that coffee has always been inexplicably pricy. “When coffee first entered the market in London in the 1650s and 1660s, it was a penny a dish,” he continues. “That sounds cheap, but you could get a small beer for about the same price, so in a way, there is kind of purchasing parity with the price of coffee today.”

Perhaps a coffee seller would be better suited to explain why iced coffee can be more expensive. In East London, you’re never more than a few metres away from a bougie coffee shop, so I spoke to a few close to my office to get their take on the iced coffee mystery.

Some didn’t mark-up their iced drinks, explaining that the cost of ice wasn’t much, and due to it not being a hot drink, they weren’t required to pay VAT on it. One barista at Ozone Coffee Roasters even said it takes them less time to make than a regular coffee, because there’s no steaming involved.

Those who did increase the price, however, were hard-pressed to justify their hike. One coffee shop manager I spoke to joked that people were only now cottoning on to it being a scam after this tweet, but maintained that there were, in fact, some reasons for the extra cost. “[It’s the] price of ice—be it, having to buy ice wholesale, which is expensive, or having to rent and maintain an ice machine,” they told me, asking to remain anonymous. “Most iced lattes will be served in a much bigger cup than a normal latte, which negates that ice is taking up the space.”

They added sheepishly: “It's only 30p extra…”

I wondered whether a small part of the iced coffee price increase was due to knowing people are desperate in the heat. “Yeah, I guess so,” they conceded. “[but] it’s in the same way that there's a crazy mark-up on ice creams from ice cream trucks, rather than if you bought it in a shop.”

As with any profit-seeking company, be it big or small, a product’s price will not change unless the bosses decide to make less money—and boy, that is never gonna happen.

There is one way, however, to avoid the iced coffee expenditure. Let me free you from these capitalist binds by reminding you that there’s probably still poo in your iced coffee anyway.

There. Problem solved.