Australian cafes live and die on a few high-volume drinks. When milk, wages, and takeaway packaging move in different directions, margin can drift even if sales volume stays flat.
This guide is built for real operations: one formula, one flat-white example, and local execution moves you can run in a weekly cadence.
Quick Summary
- Build drink cost as
beans + milk + add-ons + cup/lid + labour. - Set a target price ex-GST, then convert to the menu-board GST-inclusive number.
- Apply weekend/public-holiday surcharge only with clear disclosure.
- Reprice top sellers first, then expand to the full list.
Why 2026 Pricing Discipline Matters in Australia
ABS published the December 2025 CPI release on 2026-01-28, showing inflation pressure that still feeds directly into foodservice cost lines.
At the same time, Australian cafes keep dealing with wage and penalty complexity at shift level, so old “single blended drink cost” assumptions fail quickly.
If you only reprice once a year, you are likely absorbing cost changes for too long.
Core Formula (Australia Cafes)
Use one pricing structure and keep the tax logic explicit:
drinkCost = beans + milk + addOns + cupLid + labour
targetPriceExGst = drinkCost / targetBeverageCostRate
menuBoardPriceIncGst = targetPriceExGst x 1.10
sundayPrice = menuBoardPriceIncGst x (1 + sundaySurchargeRate)Worked Example: Sydney CBD Flat White
Assumptions for a takeaway-heavy cafe:
- Beans:
A$42.00/kg - Dose:
20g - Milk:
A$2.40/L - Milk used:
180ml - Add-ons:
A$0.18 - Cup/lid:
A$0.45 - Loaded labour:
A$32.00/hour - Bar time:
2.5 minutes - Beverage target:
25%
Cost breakdown:
- Beans:
42.00 x 0.020 = A$0.84 - Milk:
(2.40/1000) x 180 = A$0.43 - Add-ons:
A$0.18 - Cup/lid:
A$0.45 - Labour:
(32/60) x 2.5 = A$1.33
drinkCost = A$3.23
Target ex-GST price:
3.23 / 0.25 = A$12.92
Menu-board price (GST-inclusive):
A$12.92 x 1.10 = A$14.21
With a 10% Sunday surcharge:
A$14.21 x 1.10 = A$15.63
Local Playbook: Sydney CBD vs Suburban Perth
| Context | What usually leaks margin | Practical move |
|---|---|---|
| Sydney CBD weekday-heavy cafe | High peak throughput and labour compression | Audit AM build times weekly and keep a separate weekday contribution check |
| Suburban Perth weekend-focused cafe | Lower weekday volume and higher surcharge sensitivity | Keep surcharge signage explicit and update alt-milk upcharges monthly |
The right answer is not one national number. It is one consistent method applied to your local trade pattern.
20-Minute Weekly Pricing Loop
- Pull top 10 drink sales for the last 7 days.
- Update beans, milk, and packaging costs from fresh invoices.
- Recalculate drink cost and compare against target beverage cost.
- Adjust only the largest outliers and recheck next week.
Related Guides
- Cafe Menu Cost Guide
- Cafe Dessert Cost Guide
- Australia Menu Pricing Guide
- Australia Menu Pricing Calculator
- Australia Menu Price Rounding Guide
- Australia Restaurant Labour Cost Calculator
- Australia Restaurant Prime Cost Calculator
- Menu Engineering Guide
- Food Cost Ratio Guide
KitchenCost helps teams keep recipe cost, labour assumptions, and menu targets in one workflow.