Starbucks Tall Latte Index - India is amongst the least affordable in the world

You've probably heard of the The Big Mac index as a way of measuring Purchasing Power Parity (PPP) between different countries, it uses the price of a McDonald's Big Mac as a benchmark to compare the cost of living and currency valuation across nations. Here's another interesting one, more in sync with rising coffee consumption trends across the world - Starbucks Tall Lattes.

Started in 1971 with one humble coffee store, Starbucks operates over 35,000 stores in more than 80 countries today. As per finding of the Starbucks index initially created by the Wall Street Journal (WSJ), the most expensive Tall Latte (12 oz) in the world can be found in Switzerland for $7.17. On the other hand, the same drink can be bought for a little over a dollar in Turkey (least expensive).

As a share of the median daily income, the US is the most affordable country to buy a Starbucks latte while countries like India and Cambodia are least affordable. You'd think it counter-intuitive and contrasting to the big Mac index, where it's more common to assume that countries with a “developing” or “low-to-middle income” status have cheaper prices than higher-income countries. But the "aspirational" tag to Starbucks in these countries makes it more expensive.

However, there's also a HUGE opportunity to then make great quality affordable coffee available en-masse in countries like India to replace Starbucks, as the economy grows and consumption patterns change and mimic the West. Always happy to chat more over a great cup of coffee, not from Starbucks.

Reference Links

Mapped price of Starbuck Tall Latte across the world

The Latte index