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The ROI Analysis: Starbucks vs. Espresso Machine at Home

I like Starbucks coffee. A lot. But after doing some math (encouraged to do so by Kate), we realized I was spending a ridiculous amount of money on Starbucks coffee.

After some deliberation, research and ROI analysis, we took the plunge and bought our first espresso machine this week. We're now saving big and drinking much better coffee. 

The ROI Analysis: Starbucks vs. Espresso Machine at Home

Pros of Starbucks: Someone else makes it.

Cons of Starbucks: It costs a lot considering what's in it. Miss out on the Starbucks "Experience": including queues (three of them: one to order, one to pick up the drink, one for "condiments"; Attempts at upselling and crosselling ("would you care for a Cinnamon-whatever-cake with that?"); Tip expected. Irritated spouse.

Pros of Espresso Machine at home: Big savings (see below). No travel required. Tastes a lot better than Starbucks. Happier spouse.

Cons Espresso Machine at home: Having to make own coffee and cleaning up after.

Starbucks - Money Down the Drain

  • cost per grande latte: $3.20
  • lattes p/day: 2
  • $ per month at Starbucks: $194.7
  • $ per year at Starbucks: $2336
  • OMG factor: very high indeed.

Great Tasting Home-Made Lattes with Espresso Machine

  • cost per home-made latte (double shot): 60 cents
  • home-made lattes per day: 2
  • $ per month on ground coffee: $37.5*
  • $ per year on ground coffee: $450

The Bottom Line

Savings per year: $1,886**

Bottom Line ROI = 17 weeks, inc. cost of espresso machine*** and ground coffee beans.

--

Assumptions:

* 25 double shots per 1 lbs coffee, at $15 per pound of coffee. 2.5 pounds per month @ $15 per lb (high-end est).

** Does not account for initial outlay on espresso machine, milk, saved gas, nor days away from home travelling on business.

*** Cost of espresso machine + misc. equipment + tax = $500

Posted: Oct 06 2007, 12:33 PM by alexbarnett | with 7 comment(s)
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Comments

Ted Haeger said:

First, allow me to comment about how this analysis has all the markings of someone who went into hyper-focus after intaking too much of a stimulant substance.

Second, I must ask whether you have factored in the away-from-home-espresso-machine kamikaze runs to Starbucks or the local Border's cafe. Are these outside of the calculation?

Third, perhaps in the spirit of full disclosure, you should mention where you bought the espresso machine. After all, the OMG factor is not measured in Latte proceeds alone.

Fourth and finally, I must state that perhaps it is time for us to investigate getting one for the office...albeit, perhaps a less costly model.

--Ted

# October 6, 2007 3:32 PM

alexbarnett said:

Mr Haeger,

On point 1. Your perceptive skills have not failed you.

On 2. These are outside of the calculation since this a highly variable constant.

On 3. I bought the machine at Starbuck, discounted fro $835 to $450, not including paraphernalia.

On the fourth point, I like it...

# October 7, 2007 3:14 AM

Dan Ciruli said:

You want to save some *more* money, and have some fun at the same time?

Try a home coffee roaster!  My wife gave me one for Christmas a year and a half ago, and I've never looked back.  Premium beans are $5 a pound.  The roaster is a piece of cake to use: fill it with beans, press one button, and wait 25 minutes.  I roast about once a week.

(FYI, the roaster I use is by Nesco:  www.sweetmarias.com/prod.NescoCoffeeRoaster.html)

Happy caffeining!

# October 8, 2007 10:19 AM

alexbarnett said:

thanks Dan...am checking it out.

# October 8, 2007 11:36 AM

Steve said:

We've had our Saeco super-automatic gratification machine for 3 years (built in grinder knocks 30s off of latency in the morning) As of this morning it had spewed forth 5,172 shots of espresso.

Consistent crema *every morning* - Priceless (well at $4,000 profit and climbing...)

# October 8, 2007 12:40 PM

Daniel Posch said:

I have an espresso machine... I quit starbucks when I got it. I dry for almost a month. Then I found out that Barnes and Noble cards work in their cafes... oh well.

Thanks Alex!

# October 8, 2007 9:48 PM

Coffee Needed said:

Alex Barnett has done The ROI Analysis: Starbucks vs. Espresso Machine at Home I like Starbucks coffee. A lot. But after doing some math (encouraged to do so by Kate), we realized I was spending a ridiculous amount of money on...

# October 10, 2007 3:52 PM