Article Analysis Coffee
“Coffee is the cream to a meal,” says Tim Cleland, sales manager for institutional and gourmet divisions of Gavina Gourmet Coffee, based in Vernon, Calif - Article Analysis Coffee introduction. Coffee was once considered a breakfast drink. It was once a nice hot drink to start your day. Now, the coffee industry is changing drastically. Not only are more Americans demanding coffee but also it is being drunk in different ways. There are iced coffees, lattes, mochas and many more varieties to choose from. There are more specialty coffees as well.
Coffee is definitely becoming a high demand. The demand for coffee has changed drastically. According to (2002) “Coffee consumption in the United States is definitely on the rise. ” (p. 1). The demand for the beverage is on the rise because drinkers are allowed a broader range of styles for their drinks. Starbuck is an example of one company that is taking over the coffee brewing industry. They offer everything from regular, special and gourmet coffees. With better coffees becoming available, consumers have come to demand it.
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The NCA estimates that 161 million Americans drink coffee at least occasionally, making up 77 percent of U. S. adults over 18. The coffee addiction is not an understatement. Consumption of coffee is on the rise. The supply of coffee is rising because you have so many options when it is being prepared. A consumer is now allowed to go beyond the regular and decaf. There is way more options available especially at retailors such as Starbucks. You no longer have to warm your body with a nice hot cup of coffee but you can chill your body with a nice cup of ice coffee or a Frappuccino.
You have so many more options like hazelnut flavors, mochas, light or dark or you can even pair it with other foods such as desserts. Consumers can now order coffees from different regions of the world. Coffee quality can vary from one microclimate to the next. There are main producing regions that are known for Arabica coffee. In my opinion, I think coffee is elastic. There are 3 factors that affect elasticity. The availability of substitutes is one. This basically breaks down to the more substitutes available the elastic the product becomes.
So if the price of coffee went up in price, then consumers will replace it with something comparable. A rise in price will cause a decrease in demand. The next factor that affects elasticity is the amount of income available to spend on the good. This can cause the buyer to decrease their demand for the product if the price goes up and their income remains the same. The last factor that affects elasticity is time. If the price of coffee goes up and the drinker finds it hard to spend the difference then they will start to find an alternative over time.
This makes coffee elastic as well. Consumers respond to price changes in different ways. It depends on the amount of the increase and how much it will affect their budget. If it is a small increase, I think that the coffee drinker will continue to buy the product. If it goes up a dollar or two, I think that the demand for coffee will be highly affected. With the variation of coffee, available in the United States it is hard to determine if the demand will ever go down for the product.
Also, it has caffeine in the product that is believed to be addictive. I think that a lot of people are addicted to coffee more then just liking the day. It is also just as comparable to smoking. This addiction is on one that will be hard to rid unless you are not able to buy it. The coffee business is growing fast. It is believed to grow more in the future. I think that more people are becoming coffee drinkers over time. I am not a coffee drinker but I do fine myself having a cup of specialty or gourmet coffee every once in a while.