Or, why are specialty coffee drinks $7—and are they worth it?
If you’re a millennial who doesn’t own their home, welcome to the club! We’ve all heard those millionaire pundits who say our generation could hit the major life milestone of homeownership if only we could pry the $7 lattes and $15 avocado toasts from our trembling hands.
Less than half of millennials in the U.S. (the age group hitting 40 this year, most of whom are in their 30s) own homes, compared to about 70 percent of Gen-Xers and 78 percent of everyone older than that.
Who’s to blame? Is it really us and our fancy coffee habit? And even if $2,555 a year of daily espresso and steamed milk isn’t the source of millennial money problems, why does a specialty latte cost $7 now anyways?
I talked with five local coffee shop owners about how that drink price breaks down and what you’re actually investing in when you purchase a bourbon mocha at Vice & Virtue or buy a bag of Guji Mane from Cxffeeblack.
What we’re paying for
Paying more for coffee supports the people who run and work at local businesses, and it reflects the true, ethical cost of getting coffee from bean to barista to your hands.
Tim and Teri Perkins started Vice & Virtue coffee roasters in 2017, have a cafe in the Arrive hotel, and plan to open a coffee and amaro bar, Anima, in Midtown this year.
“There’s a big difference between a small local business and its place in the community and a chain. When you pay a little bit more for coffee, you’re supporting the local economy,” Tim explains. “More dollars stay in the city.”
Then there are the actual costs. Amy McPherson of Comeback Coffee in the Pinch District was kind enough to break it down.
“To put it into perspective, we pay anywhere from $70 all the way up to $120 for a five-pound bag of coffee,” she shares. “That’s anywhere from $0.66 to $1.06 for just the espresso. A 12-ounce cup and lid cost us $0.22. Milk for a 12-ounce latte is $0.40 currently. We are already sitting at a base of $1.28.”
Then you add any additional ingredients, labor, overhead, and waste. Now the $4 to $5 base price (pre tax or tip) of our local coffee shop lattes starts to make sense.
What about those who can’t fathom a $5 coffee? Bartholomew Jones of Cxffeeblack has thoughts.
“We know that coffee was discovered in Africa and is a product of colonial efforts of enslaved African people in Brazil,” he explains. “The widely accessible, affordable drink is the product of a business model built on having free labor.”
So that’s why our grandparents’ coffees were 50 cents.
Fair trade coffee meets certain requirements for living wages, sustainability, and ethics in coffee sourcing through importers. Direct trade takes it a step further and describes the one-step relationship between producer and roaster in order to increase profit for the farmer.
Can small coffee shops feasibly find ethically sourced coffee? They can, if they’re willing to put in the time and effort. Many of our local spots are willing, which is another reason to support them despite rising costs.
Bartholomew Jones and his wife, Renata Henderson, founded Cxffeeblack roastery in 2016 and run the Anti Gentrification Coffee Club on National Street. They’ve received international media attention for their commitment to direct sourcing and mission to reclaim the Black history of coffee.
“If I’m not purchasing coffee from people who reside in the country with the folks who are growing the coffee or who are related to the people growing the coffee, I’m not gonna buy the coffee,” Jones states.
He recognizes that not everyone can do it this way. It was a process that took years of work and fundraising, but it’s one that’s central to their mission. He shares that, for their signature roast Guji Mane, they “went all the way to the farmer’s house” in the Guji zone of Oromia in Ethiopia. That journey is the subject of their award-winning documentary, Cxffeeblack to Africa, and they plan to make their third visit to the African continent to meet with coffee producers this fall.
Boycott Coffee, located on Madison in downtown Memphis, has been roasting since 2017. “We’ve had a long time to establish partnerships in Central and South America,” founder Alexander “Zan” Roach explains, noting that coffee farms disappearing due to labor and environmental problems also affects prices. “Seeing what those farmers face—some of them are actually avocado farmers too—they’re having the same struggle [as small coffee shops] when it comes to maintaining a viable business.”
City & State’s house roaster is third-wave company Intelligentsia, known for pioneering direct trade sourcing in the coffee industry. Longtime manager Katie Wells explains that, after a few years in business, City & State also began working with a rotation of small specialty roasters, like the Brooklyn-based Sey Coffee.
“With Sey, they communicate how much they pay for coffee and the farmers’ stories, and we like to look at this,” she says.
“We’re honoring everyone whose hard work and hands have gone into it—farmers, harvesters, roasters, importers; there are so many people involved in getting the bean from the plant to the latte.”
Vice & Virtue’s Q Arabica Grader (aka coffee sommelier) Kevin Wukasch took an origin trip this spring to Guatemala, where he spent a week with Onyx Coffee importers, visiting different coffee farms. (Onyx Importers is not to be confused with the Arkansas-based Onyx Coffee Lab.)
“Onyx is our only importer for all our barrel-aged coffees, and we have a good, long-standing relationship with them,” Tim explains. “When you’re really small, it’s hard to have the funding to develop those direct trade relationships, but as you grow, you work with more importers who make those connections for you.”
As a multi-roaster, Comeback offers coffees from different roasters that they score on three pillars: transparency and ethics, quality, and design. Each selected roaster, like the aforementioned Onyx Coffee Lab, Delaware-based Brandywine, or Obadiah from Scotland, has to score high on all pillars.
“After looking at all of the hands involved and the items that make it up, people should look at coffee like they look at a cocktail, a specialty beverage,” says Amy.
Paying the people
Zan from Boycott urges coffee drinkers to pay attention to the shops that take care of their baristas. Boycott Coffee pays $12.50 per hour plus tips. “We obviously want to bump that up and make sure our baristas are not only having a good time, but are financially supported,” he explains.
At Vice & Virtue, the baristas make $10 an hour not including tips. “Our employees average $18 to $22 an hour with tips, which I think is pretty standard,” Tim explains. In the last year they’ve been able to start a medical expense reimbursement plan for staff members that work more than 25 hours and are 26 or older.
City & State offers paid time off and sick leave after a year, and while they do depend on tips for staff compensation, there’s also a safety net. “Tips vary wildly,” Katie explains. “During slow periods we add up to the guaranteed rate [of $17 an hour]. This is the least amount you’re going home with.”
It’s a similar concept at Comeback, where staff starts with a base pay of $9 an hour. “If tips don’t get our folks to a liveable wage, we ensure that we cover the deficit,” Amy says. “This seems to be unique to the coffee industry as compared to the restaurant industry [where they] rely on tips to compensate their workers to get to minimum wage.”
So, are we skipping the lattes?
Maybe we can’t really buy our dream home or pay off our student loans by giving up the cold brew, but there are ways to save on coffee without sacrificing quality or ethics. More than one person mentioned buying bags of beans or grounds from your local roasters and taking advantage of the free home-brewing classes several of them offer.
On Sundays, Sustain Coffee hosts workshops and classes in the Boycott Coffee space. ‘We’ve given over this space to a local non-profit because we wanted an educational component,” Zan explains. “They’ll use our coffee or another roaster’s and educate people on how to brew coffee at home.”
The Anti Gentrification Coffee Club hosts regular workshops and offers free samples for first-time visitors to let them experience high-quality coffee, some for the first time. A dollar from each paid purchase goes to support these initiatives.
Out of curiosity, I did ask most of the coffee creators for their take on the “dumb millennials just can’t stop shoveling avocado toast and mochas into their mouths long enough to buy a house” idea.
“If that $2,500 is the difference [in someone’s life], just drink bad coffee,” Barthomoloew says.
“If we’re talking about the middle class, coffee is just one of the things you can buy with $2,500. You can buy 10 pairs of Jordans. You could also make the argument that buying that coffee is an ethical way to spend your seven bucks when you know the communities are positively impacted.”
Both Barthomolew and Zan mentioned low pay for workers and labor market changes as more salient reasons for millennials’ housing market problems. I’d like to throw inflation and skyrocketing Memphis rent prices in there too.
“People think a $7 latte is ridiculous but will pay $15 to $20 for a craft cocktail. It just depends on people’s priorities,” Katie from City & State says.
She mentions the farm-fresh milk the shop gets delivered from Kentucky. “I’d rather spend an extra $2 for ethically sourced ingredients and quality ingredients,” she says.
My favorite is this take from Zan: “If you would like millennials to buy a house, then you can support a barista by purchasing a $7 latte.”
Each drink from your neighborhood coffee cafe supports the farmer, the laborer, the importer, the roaster, and the baristas. That’s a lot of pressure on one little latte! Yet our local shops are making it work, with our support.
Holly Whitfield is the digital director for The Daily Memphian and author of the book Secret Memphis; she was the editor of the I Love Memphis Blog for nearly 10 years. Her work has been published in National Geographic, Memphis Magazine, Thrillist, TripSavvy, and many more. @holly_sayshello
Andrea Morales is the visuals director at MLK50: Justice Through Journalism and a documentary photographer in Memphis. She is Peruvian-born and Miami-bred. Her work moves with the intent of celebrating the in-between moments. @_andrea_morales