We have been asking UK coffee shop and café owners to complete our 2018 Café Milk Price survey.
Most independent coffee shops and cafés rarely talk to other similar businesses about milk prices, even if they do they never share this type of confidential operational information with each other for fear of giving away their secret advantage or feeling silly!
The reasoning behind the research is simply to provide you visibility of this necessary cost of operating.
Firstly we asked how the milk arrived at their door. 53% of those had it delivered by a milkman, 21% bought it from a local shop, 16% visited a cash & and carry and 10% from a general fresh food supplier who also delivered other goods as well.
Unless the local shop or cash & carry is next door, then having the milk delivered is by far the most efficient use of your time.
By its nature milk is cumbersome to transport and needs to be refrigerated, but what is a fair price to pay for this convenience?
The lowest milk price was paid by those who visited a cash & carry at 92p, those who went to a local shop or had a general fresh food supplier deliver paid the same at £1.10 and if they had a milkman deliver they spent an average of £1.18.
Those who visited the cash & carry used more milk (11 bottles per day) that those who bought it from the local shop (7 bottles per day) So overall going to the cash & carry could save you money, but you would need to add in the staff cost and transport costs involved. It seems that when you get to a certain level of usage, you will look to the convenience of door deliveries.
Overall the average milk price was £1.11 per bottle across all suppliers.
Interestingly greater volume was not a guarantee of a lower price. The largest single user paid 12% above the average for their milk.
If you read this and are tempted to contact your milk supplier and demand a price reduction, then don’t.
Your suppliers should be nurtured to become your partner, and building a long-term relationship with them will pay dividends over time.
In the past, we have moved suppliers because of cost, only to find the price increases ‘because of market forces’ a few months after we changed over. A better alternative is to talk to your suppliers about what else they could deliver, and so give them more business allowing them to reduce their prices while still making a decent return.
Unfortunately, we have seen a number of our suppliers go bust over the years because they worked with the wrong customers but not before causing us major operational problems because they were on the brink of collapse.
We work with a number of businesses that can reduce your costs, it will depend on the size and readiness of your business on who we recommend. Please get in touch if you would like to discuss alternatives in the UK.