For years, coffee shops have been synonymous with cappuccinos, community, and comfort. But in today’s economy, caffeine alone isn’t paying the bills. Across the US and Europe, cafés are expanding their menus — adding sandwiches, wraps, and salads — in hopes of boosting profits. Yet as inflation rises, labor costs climb, and operations become more complex, one question looms large: can coffee shops really make money from food?
Why Coffee Shops Turned to Food
Coffee remains the anchor product for most cafés, but it’s no longer the main profit driver. While a $5 latte may look lucrative, its profit margin is often thin once rent, wages, milk, and utilities are factored in. Food, on the other hand, has long promised higher returns. A pre-made sandwich or salad can be sold at triple or quadruple its raw cost, instantly increasing the average ticket size per customer.
Big chains have relied on this logic for years:
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Starbucks announced plans in 2018 to double its food sales by 2021.
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Pret A Manger built its empire by pairing low-cost coffee with high-margin food. Its 99p filter coffee attracts customers, but most profits come from £8 sandwiches and salads.
The numbers seem to support the strategy. In 2024, food accounted for 23% of Starbucks’ total revenue — around $6.7 billion.
Nathan Hamood, President and Director of Coffee, explains: “It’s getting harder to make coffee alone sustainable. For us, dessert items helped — they raise ticket averages without complicating operations too much. But food requires a lot more planning and precision.”
The Economics Behind the Menu
Adding food might seem like an easy way for coffee shops to grow revenue, but the reality is far more complicated.
Food brings in higher sales per customer — but also higher costs. A sandwich means ovens, refrigeration, hygiene checks, and more staff training. Each new menu item adds operational friction and slows service.
In an industry where “speed” and “convenience” define the customer experience, this is risky. According to Technomic, the number-one reason consumers choose a café is speed of service — and food prep threatens to slow that down.
Meanwhile, labor costs are eating into profits. Since 2019, hourly wages for baristas and café staff have climbed sharply, hitting $18–$20 per hour in many US cities. Brewing coffee can be partially automated; making food cannot.
The Hidden Costs of Serving Food
Coffee beans can sit on the shelf for months. Bread, meat, and produce cannot. That makes waste management one of the biggest financial pitfalls for food-heavy coffee shops. Every unsold salad or sandwich at the end of the day is money lost.
The UK alone wastes over £3 billion worth of food each year, much of it from restaurants and cafés. Smaller independents, without precise forecasting tools, are hit hardest.
Hamood sums it up: “You might think adding sandwiches will increase profits, but it’s never that simple. Waste, extra staff, equipment — they all add up fast. The margin on paper looks great, but reality eats into it.” This is why many coffee chains use commissary kitchens — central production hubs that pre-make food for delivery to stores. Starbucks’ sandwiches, for example, are prepared and frozen offsite, then heated in-store. It’s efficient, but it sacrifices freshness and the artisanal feel that independent cafés value.
Coffee Shops vs. Restaurants: Where’s the Line?
As menus grow, many coffee shops risk losing their identity. Are they cafés, or are they fast-casual restaurants that happen to sell coffee? Chains have already blurred that line. In Asia, bakery-café hybrids such as Paris Baguette thrive by combining pastries, sandwiches, and espresso. For smaller specialty coffee shops, this shift can be uncomfortable. Their appeal often lies in simplicity — quality coffee, minimal food, and a relaxed space. Adding full food service changes the atmosphere and operational rhythm. “Food changes everything,” says Hamood. “It can help you grow, but it also risks diluting your brand. Coffee shops have always been community spaces — not restaurants. We need to protect that.”
Balancing Growth and Identity
To survive, coffee shops must strike a balance: offering food that complements coffee, not overshadows it. The most successful cafés use strategic diversification rather than full transformation. Instead of hot meals, they focus on baked goods, pastries, or grab-and-go snacks — items that boost spending without complicating service.
Smaller cafés are also finding creative ways to maximize value:
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Partnering with local bakeries to stock fresh items without investing in kitchen equipment.
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Introducing limited-time menu items to test demand without waste.
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Using bundled pricing (e.g., “latte + croissant” combos) to increase per-customer spend efficiently.
This approach preserves the café’s soul — coffee remains the centerpiece, food supports the experience.
The Bigger Picture: Coffee Shops in a Shifting Economy
The struggle of coffee shops to balance food and coffee reflects larger trends in the global economy. Inflation has driven up the cost of everything from milk to rent. Consumers, meanwhile, are cutting back on dining out.
Food still pays off — but only with disciplined operations, precise forecasting, and strong brand strategy.
For independents, that means thinking carefully before expanding menus. For chains, it means optimizing efficiency without losing authenticity.
Coffee Shops of the Future: Back to the Basics?
As the industry matures, many experts predict a return to coffee-focused simplicity.
Large chains may continue to rely on food for growth, but independent coffee shops can win by emphasizing craftsmanship, storytelling, and experience — elements no sandwich can replace.
“Coffee has always been about connection,” Hamood says. “If we lose that, we’re just another restaurant. The best cafés keep coffee at the center — and build everything else around it.”
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