How Much Do Customers Spend On This Product?
The majority of you are intelligent and economical people, so you save money on your coffee at home, but the price of coffee in coffee shops is typically quite high. The typical consumer at Green Mountain Coffee spends $15, while those at Starbucks, McDonald’s, and Peet’s Coffee pay $12 each.
The coffee chains generate good profits with these funds. Starbucks dominates the coffee business with yearly sales of $21.38 billion (as of 2019). Dunkin’ Donuts is in second place with $9.229 billion in sales, followed by Peet’s coffee in second place with $358 million in annual sales.
How much more can you buy with your money instead?
You’ll probably spend the least on coffee each year if you make your own at home using the cheapest brand you can find at the grocery store. I want to get back to the comparison of annual spending between men and women. The average woman would have $23,270 saved in 10 years compared to the average man’s $19,340, also without attracting any attention, if they had chosen to save that money rather than spend it.
What if you invested $1,500 annually as an alternative? In ten years, how might that money help you?
Savings account: If you deposited $1,500 year in a savings account bearing interest at a rate of roughly 0.50%, you would earn an additional $7.50 annually, or $75 over ten years, for a total of almost $15,575 in savings.
Retirement plan: According to Business Insider, American workers’ average 401(k) yields will be about 15.1% in 2020, however individual retirement plan returns may differ. That would be an additional $226 for every $1,500 that is spent year on coffee. Compound interest would enable you to amass more than $35,000 if you kept investing the money and the profits for ten years.
The earning potential of a certificate of deposit (CD) is up to 0.8 percent. Over the course of two years, if you had invested the $3,000 you would have spent on coffee, you could have made close to $250. Even though you just have a small amount of money, you are better off than you would be without any investments. It also takes that money out of your hands and makes it unusable.
Nobody is forcing you to give up your favorite alcoholic beverage, but you might be amazed at how much money you can save by cutting back on your consumption, making your own coffee at home, or choosing the least expensive alternative.
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