PANICKING a little… my café near a busy office area cut coffee prices from $6 to $2.50, customers flooded in, but profits still suck. Did I completely screw up?
I run a small café near a busy office and coworking area, so we get a lot of rush-hour traffic. A few months ago, we lowered our coffee prices hard to compete with bigger chains nearby. A latte that used to be around $6 is now $2.50.
Now the café is packed almost every day. Foot traffic exploded, people keep talking about our prices, and sales volume is way up. But profits honestly still feel disappointing. Staff is stressed, margins are tiny, and it feels like we are working way harder for almost the same money.
Meanwhile another café nearby charges almost double and still has loyal regulars every day. Starting to wonder if competing on price just attracts customers who only care about price. Has anyone here made this strategy work long term?