Sydney takes out title for cheapest coffee

Sydney has Australia's cheapest coffee. According to the "Gilkatho cappuccino price index" for the March 2013 quarter, in which more than 1000 cafes in seven capital cities were surveyed, Sydney coffee drinkers pay on average 40¢ less than those in Perth, which took out the dubious honour of being the most expensive city in Australia to buy coffee for the third consecutive year.

“Coffee bean prices are currently at a three-year low internationally, but prices for a cup are showing no sign of decline, indicating customers are more likely to pay for an experience,” says Wayne Fowler, managing director of coffee company Gilkatho.

“It's not about the prices – it's about the experience. As long as you're happy with what you have, the cost is just secondary,” he said.

In Sydney that "experience" will set you back around $3.22 for a takeaway and $3.38 to drink your beverage in-house, with Melbourne slightly more expensive at $3.37 for takeaway and $3.45 to drink in a cafe. Brisbane is the country's third-dearest city to buy a coffee - at $3.52 for a takeaway, just 9¢ cheaper than second-place-holder Hobart.

Paul Geshos, owner of Mecca Espresso in Sydney said he “wasn't surprised” at the findings.

“In my experience, Perth and Brisbane have always been at the higher end when it comes to buying coffee. In Sydney and Melbourne, it's a lot more competitive because there are more operators. Unfortunately, I think people use price far too much for driving sales, which can send the wrong message in terms of quality.”

Mr Geshos said he believes the prices in Perth were more in line with what the price of coffee should be.

“I had a cafe 13 years ago and a coffee doesn't sell for much more now than it did then, but wages and rent have doubled. Realistically, it's a labour-intensive process from the growing and production of the beans to making a coffee to order in a cafe and if everyone were to get a fair price from the farm level upward, a coffee should cost around $6. But while people are happy to pay $10 for a glass of wine they baulk at paying $4 for a coffee.”

As well as being the top two most expensive cities for coffee in general, Perth and Hobart are also the only cities where it is more expensive to take your coffee away than have it in.