We’re going to take the liberty today here at The Economics of Bacon Headquarters to predict the next economic bubble. In economics a bubble may be referred to trade in assets with inflated prices. So when these prices are not sustainable anymore the bubble bursts, meaning the market for said product collapses. So here it is the next bubble, which has taken a long time to burst: Coffee Houses, specifically, your local green and white coffee shop. I must say, it is delicious and kind of cool to be there, you almost feel smart and good looking just by holding a white and green cup. My choice of drinks is not very sophisticated; I just get the tall regular coffee of the day which is what I’m going to concentrate on. Your local green and white coffee shop typically uses 2 tablespoons of coffee per 6 ounces of water, so for a tall coffee which has 12 ounces of coffee they use 4 tablespoons of ground coffee. Now a 1 pound coffee bag may cost you around $10. To figure out the how much coffee by weight is in a tablespoon we need to know the approximate density of ground coffee. This requires some mathematical calculations* but the result after taking into account the density of coffee is that there are .38 ounces by weight in each tablespoon of coffee. So if you use 2 tablespoons of coffee per six ounces of water it means you’re using .76 ounces by weight of coffee per six ounces of water. The one pound bag has 16 ounces of coffee, so with that bag you should be able to make 10.5 tall coffee cups (16 oz. /.38 oz. = 42 tablespoons/4= 10.5 Tall cups of coffee). That means that if you follow the measurements used by your local green and white coffee shop your cost per tall coffee if you make it at home is around $.95 per tall coffee. Considering that the range for a tall cup of coffee is from $1.65 to $2.00, or where I live where it is $2.65, making coffee at home makes sense considering the potential savings. Once people realize the savings they can have by looking into the numbers your local green and white coffee shop will be in trouble. I know it’s not the same; it’s not very cool to sit in your living room pretending to be at a coffee house, but hey, with every shift in demand there are new opportunities that come up. Here's something for all the entrepreneurs out there, how about coming up with the “Coffee House Kit”. That’s right, how to turn your living room into a cool and classy coffee house lounge, with nice earthy tones, some green to remind yourself of where you’re trying to be and some smooth jazz coming from the speakers. You may also have cardboard cutoffs of attractive intellectual looking members of the opposite sex as well as piles of books that you will never read, but may hold just to feel smart. Hey, during these hard times you got to get inventive when it comes to saving money. And you can have all this for just 19.95! That’s right, $19.95, less than the cost of 21 tall coffees made at home. Too good to be true? Relax. It’s all going to be made in China anyway.
*To obtain the bulk density of ground coffee we can take the average between coarse ground coffee (19 lb/cu ft) and that of fine ground coffee (25 lb/cu ft) resulting in an average bulk density of ground coffee to be 22 lb/cu ft.
We also know (from google) that there are 915 tablespoons = 1 cu. ft., then the number of ounces per tablespoon is of ground coffee is:
22lb/cu ft (16 ounces) (1 cu ft)
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1 cu ft (1 lb) (915 Tbl) = 0.38 ounces/Tbls
References
http://coffeecraftsman.blogspot.com/2009/05/coffee-to-water-ratio.html
ivetz, M.; and Desrosier, N.W. 1979. Coffee
Technology. AVI Publ. Co., Westport,
Connecticut, USA.
SCAA website. http://members.scaa.org/train/certification/coffeebrewer/CoffeeBrewerCertDocs/Certification%20Standards.aspx
http://www.dccoffeeproducts.com/inc/Coffee_Brewing_Guide.pdf
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