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Starbucks Hiking Prices Despite Falling Coffee Costs

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The mega-chain began in 1971 as one store in downtown Seattle. Three friends invested $1350 each of their own money. Imagine that return! (Getty Images)

The mega-chain began in 1971 as one store in downtown Seattle. Three friends invested $1350 each of their own money. Imagine that return! (Getty Images)

SEATTLE (CBS/AP) – Starbucks wants a few extra pennies for that latte.

The Seattle-based coffee company has said it’s hiking prices on average by 1 percent nationally starting Tuesday. But it says the price for many drinks, such as medium and large brewed coffees and Frappuccinos, won’t change in most of its 11,000 U.S. cafes.

Depending on the market, Starbucks Corp. notes it’s the first price hike most customers will see in about two years.

The price hike comes despite falling coffee costs that have boosted the company’s profits. In the last quarter, Starbucks cited lower coffee costs for a stronger operating margin, which represents the money it pockets from sales after subtracting what it pays to keep stores running.

(Copyright 2013 by CBS San Francisco. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed.)

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