Cold brew coffee has become the go-to warm weather coffee drink. Gone are the days of $1.50 iced coffees from Dunkin Donuts; now coffee fans spend as much as $6 on a medium cold brew. Popular national and international chains have picked up on the trend, too. Starbucks has several variations of cold brew, most of which cost around $5 for a grande/medium. Even 7-Eleven is capitalizing on the trend, advertising their new and improved cold brew coffee at most stores in America. 

If you’ve been into an American coffee shop in the past couple of years, you’ve noticed the extreme price difference between iced coffee and cold brew. You’ve also likely wondered about that mark-up; is it because the coffee is actually better, or is it because shops want to cash in on a popular trend? Well, it’s a little bit of both. 

There’s no question that cold brew’s popularity is driving the price. Both chain and independently-owned coffee shops understand that their customers are more likely to opt for a cold brew in 2018, and adding an extra $0.50 to the price can result in several hundred dollars of additional revenue on a good summer day. Increasing the price just a bit can have a lasting impact, turning a usually tough coffee season into an incredibly lucrative few months. However, we can’t blame the high price of cold brew on greedy business owners.  

Cold brew is exceedingly expensive to produce. To make this coffee, baristas must soak a lot of coffee. A good rule of thumb is to grind around 1 cup of grounds and add to 4 cups of cold water. That ratio is significantly different from a usual drip; it uses roughly 4x more coffee beans than a standard cup of iced coffee. Though the coffee is meant to be watered down a bit (this brewing method produces a coffee concentrate), the production cost is still way higher than the standard cup. 

While you may remain frustrated with high cold brew costs, it’s important to know that producing this type of brew is a huge cost for most coffee shops. If you’ve never tried it, get an extra small and see what you think—the taste is a lot stronger and more complex than the standard iced coffee, but it’s not for everybody. If you love the brew but can’t justify the purchase, try making your own cold brew concentrate. It’s a lot cheaper, and you can adjust your concentrate-to-water ratio very easily.