I recently had an email discussion going out for coffee with a friend in Napa California. I am in Northern Italy–not in a tourist destination.
My wife and I go out for coffee every day when we are in Italy. The other day we ordered two cappuccinos and one croissant. It was 5 euros which is about $5.25.
My friend responded that two cappuccinos and croissant is probably $6 + $6 + $5 = 17 plus $3 tip = $20, maybe more in downtown Napa.
Four times as much. how can you explain such a price differential?
When I visited Italy (Turin) a few years ago, I was paying around 1 euro for an espresso in a cafe. Which was much more reasonable than what they were charging in the UK at that time (UK prices were probably double). In KL this week I was paying around 8 ringgit (around £1.50) for an Americano and around 11-12 ringgit (around £2) for a flat white/piccolo/cortado. Whereas in the UK I’d be paying £3.80 for an Americano, £3.70 for a cortado and £4.35 for a flat white at a popular chain.
Don’t know why coffee is so much more expensive in the UK/USA?
You asked a similar question before. The short answer is Italy is a poorer country than the US. Median household income for Italy is about $30,000 versus the US at $80,000. So the typical American family has twice the income of an Italian family. Basic economics and purchasing power. Its going to get worse for Italy and the rest of the EU.
As you are an American I presume spending dollars in the EU, your purchasing power has increased 4% since the election. You can thank Trump for that. Same reason a few years ago Americans were buying flats in Paris and London. Europe was marked down by 1/3. It was essentially a fire sale if you had dollars to spend.
It’s essentially the same factors that are behind Americans retiring to Mexico and Costa Rico. US dollars go much further in poorer countries. Now applies to Europe. If you have followed the economies of Europe and contrasted them to what has happened in the US over the past 15 years, the divergence is striking. That’s why Mario Draghi put out his plan to enhance growth in the EU which is unlikely to get adopted.
I’ve been tracking my coffee costs lately. It really depends on location.
Even in Europe, in the same country, same city.
I remember paying a Euro for an espresso in small-town Portugal, when I had been paying 4 euros in Lisbon.
I’ve also started drinking more cortados to keep my fancy coffee under $5 Canadian at home heat in Canada. Most cappuccinos and lattes in Ontario run $5.75 - $7 including tax right now, whereas I can still find a cortado that will come to just under $5 including tax and a small tip.
Many years ago, I worked at this one company and there was a coffee shop/small restaurant a few floors below us.
Everyday, this one lady would go down and purchase her coffee. I think it was about $5-$6. I brought my coffee to work in a thermos. One day, she decided to make fun of me. I told her “I spend $5/month for my Maxwell House tub of coffee and you spend $5/day for yours. Over the course of a 52 week year you spend $1300 on coffee – I spend $60”
She then mentioned her car insurance was $1300/per year and if she did what I did, it would be like getting free car insurance.
As for traveling, Sunshine and I take instant coffee and instant meals with us, thus we just have to add “hot water”. I picked up this electric kettle, so we could heat up water in a motel/hotel room. Works great – saves lots of money (when we travel).
Regarding the price in Italy, it’s been kept artificially low at 1 euro for years, because people now expect an espresso to be that cheap. Kind of like how the cost of a NYC subway ride was 5 cents for 45 years; even though keeping the fare that low was one of the factors that let to deterioration of the subway system, any talk about raising it would have been political suicide.
There’s a movement now to start raising espresso prices in Italy to be more in line with realistic costs, like 1.50 or 2 euros.
What amazed me in Greece and in Portugal, which are poorer counties than Italy, is how much a coffee could cost, in 2007 and 2009, especially if the coffee shop had a nice view or location. I remember Frappes (Greek iced coffee made with Nescafe) costing 7 or 8 Euros at a coffee shop with a view in Santorini in 2007, when the same drink would cost 3 Euros in a small Peloponnesian village coffee shop and $5 Canadian in Toronto.
I don’t remember espresso being that cheap in Italy (1 Euro ) on my last visit in 2015 and in 2017, but I was mostly in Tuscany and Rome, and having coffee at pretty nice places that were fairly close to tourist sites. Not tourist traps, but higher rent.
So I get it. The average wage in the US is 2.5 times that in Italy. And in the US we pay 4 times what they pay in Italy for a coffee, or in this case for a cappuccino.
One of the joys of traveling for me is checking out the local coffee shops and trying the locally roasted, freshly brewed coffee.
@Desert-Dan, I understand bringing a kettle and watching the budget. I have a travel kettle for ski trips and road trips. I used to make instant oatmeal in my hotel room and skip breakfast some days. That said, I love freshly brewed coffee. It’s worth the cost of $5 for a nice coffee for me.
I have a thermos but I rarely use it while travelling these days.
I don’t spend money on other stuff. I save my restaurant leftovers for later. I have other strategies to get more bang for my buck while traveling.
Most drip coffee even costs more than $2 a cup in Canada right now. I was surprised that my small coffee at a local coffee shop called Donut Café only cost me $1.89 Canadian yesterday. A small coffee is running around $2.25 CAD at Tim Hortons lately, I think.
We eat a couple meals out (while traveling), but not every meal.
We prefer natural sights and wonders (National Parks), hiking, etc. over food, so we tend to spend our “entertainment budget” on those fees and items.
As a side note, Sunshine is a couple years older than me and she qualified for a “America the Beautiful” Lifetime pass (for Seniors). So we can now save on entrance fees, etc. YEA!! (totally worth it if you are into those types of vacations)
Besides the cultural aspect of keeping coffee/pastry prices reasonable in Italy, downtown Napa real estate prices have to be pricey. I’d guess the place in Italy has been around for a while. Longtime businesses (especially if they own the building) have an overhead advantage over newer businesses (especially in trendy locations). You see this phenomenon with burritos in SF Mission district. Long time business around for decades sell a burrito for $10, newer places sell for double.
There’s also the idea of a loss leader. Sell the cup of coffee for $1-2 and they buy something else. See that all the time with donut shops and mom and pop places…basically a community service. A trendy place in a nice area less likely to do the loss leader., might make the place seem cheap.
$2.07 for a large coffee because I bring my refillable cup, and sometimes it’s 20% off if you have the app!!! I know it’s a couple of tiers down from mid, but it’s close and they open at 6:30 am!
It’s not Either/ Or.
I like visiting National Parks as much as I like food, and sometimes food is not my primary objective. I still want to check out the local diners and coffee shops, when I’m visiting family or going to see a National Park.
I save money by not spending money on hair colour, manicures, make-up, lottery tickets, vitamins, spa treatments, horse racing, bingo, fine wine, sporting events, expensive purses, or concert tickets during this phase in my life.
As you noted you were comparing cost with someone in Napa to a non tourist place in Italy. That is comparing a high cost place in the US to a low cost place in Italy. My suspicion is that median household income in Napa is much higher than the median for the US given the real estate prices.
I was in Chicago last week. There was even a noticeable price difference between NYC and Chicago. Large regional variances.
Southern Europe is cheaper than Northern Europe as the economies are not as strong. Go to Greece. Will make Italy seem expensive.
That probably also depends on where in Greece. If I can find a cheaper meal than most of what we had in Sicily this summer — which is poor even compared to the rest of Italy — in Greece I’d love to know where, as we are thinking of going next summer.
Obviously, Santorini & Mykonos are to be avoided, but where do you recommend?
Even within a given area, prices can vary widely. In the Bronx (NYC) I can get a 20oz cup of pretty good coffee from a local deli for $2. A few blocks away in the same neighborhood, Dunkin Donuts sells a cup half the size for $2.89. If I want to venture a few blocks the other direction, a cafe will make me a cappuccino for $4 or $5. And I can easily pay $7 or more for a cappuccino if I head into Manhattan and have it in a restaurant.
