Why Do Coffee Machines Cost so Much? : 5 Reasons Behind High Pricing

I tried to non-capitalize the “so” in this article subject line to de-emphasize the high cost of coffee machines, but unfortunately there is just no way around it. Coffee Machines Cost a Lot!  In this post I will try to justify the reasoning behind the high price of coffee machines (in particular bean to cup coffee machines) worldwide.

There are essentially five main reasons why coffee machines cost a lot and here they are:

Components:

When I talk about coffee machines costing so much I am mainly referring to bean to cup coffee machines. Filter coffee machines and capsule coffee machines are nothing more than little machines with pumps and boilers so I have excluded them from this discussion. The three most expensive compoents in an any bean to cup coffee machine (automatic or vending) are the grinder, the brewing unit and the pump. All these components are able to be manufactured at low prices but manufacturing these core components at low prices means sacrificing on quality. For this reason, there is still no prominent Bean to Cup manufacturer in China today which has successfully broken into supplying global markets with automatic coffee machines. Unfortunately good components cost money.

Research:

Research and development is one of those things that we as consumers don’t really feel we should pay for but unfortunately any manufacturing and design business has a substantial cost attributed to research which is inevitably passed down to us, the consumers. All the staff and all the tests add a significant cost to a manufacturer’s business which lands up in the eventual price of the coffee machine.

Middle Men:

The coffee machine business is no different to any other business and unfortunately involves a number of middle men in the process (we actually happen to be one of these). Almost all coffee machine manufacturers work with distributors in various countries so the chain of sellers and resellers looks something like this:

Each party in the above diagram adds their cut onto the final price (usually in the region of 25%) which means that a coffee machine which costs the manufacturer R5000 to make is then sold to the country importer for R6500. The distributor then sells the machine on to the reseller for R8125 who then sells the coffee machine finally to the consumer for R10,156.25. Ouch!

Import Duties in South Africa:

Import duties in South Africa range form 0-20% depending on where the coffee machine is manufactured. South Africa has a trade agreement with the European Union so all coffee machines manufactured in the EU carry zero duty however all Coffee Makers coming from areas of the world like China will attract a 20% duty.

Lack of Transparency:

The internet is full with websites boasting “get a free quote now” (I don’t recall when coffee machine quotes or any other quotes were ever charged for) but finding prices of coffee machines without speaking to someone machine or without filling in a hundred contact forms is not an easy task in South Africa and is akin to pulling teeth or searching for a needle in a haystack. For this reason there are a number of coffee retailers who charge exorbitant prices, not because there is no competition, but rather because coffee machine prices are not easily obtainable in S.A. (if you want to view our online pricelist without speaking to anyone please just click this link here: Pricelist of Coffee Machines)Living in the U.S. it is fairly easy to verify and compare the price of almost any item under the sun thanks to Amazon and the vast number of other online e-tailers. In South Africa, searching for a price on a coffee

So what do you do if you want to drink good coffee?

Unfortunately having great coffee in your home or office does cost. One way to get around the high price of coffee machines is to opt for a rental package where you don’t pay for the machine and only pay for the coffee (More about that in our article –When free really is free). If rental however is not your cup of tea (pun intended ;-), then unfortunately there is just no way around that big upfront fee for a great coffee machine. One thing I can recommend is that before spending all that money on a coffee machine make sure you are happy with the machine first and opt to try before you buy.