Scalding prices

How much choice is there on and around campus for us caffeine drinkers? Costa on Central Campus and Cannon Park, Curiositea and the Costa coffees sold in Westwood. Superficially this seems a fantastic, competitive market offering the lowest possible prices to students. A closer look however reveals that the Costa franchises on campus are operated by Warwick Retail. This means the latter company control nine out of the ten cafes you find on campus.

The actual prices are not extortionate, that much is clear. A latte on campus is, on average, 10p cheaper than one in Coventry and on par with one in Leamington. A cup of tea is around 40p cheaper than both Coventry and Leamington so what is the issue? Well firstly, although the apparent prices of coffee seem reasonable, a café in Leamington town centre stocking the exact same brand of coffee is cheaper. Secondly, as I am told by a Warwick Retail employee, the University want a price increase of ten pence for the provision of a supposedly higher quality coffee bean. The University is supposed to be subsidising drinks sold on campus, not placing price premiums.

I am conducting a survey on campus in aid of my dissertation which hopes to demonstrate that Warwick Retail is abusing a dominant position.

Furthermore, it seems very unlikely the staff costs paid by the University are significantly greater than those paid by independent cafes in the surrounding area as the pool of labour would be similar. Even the rent paid by Warwick Retail for these cafes is unlikely to be the same as the University is sure to subsidise the costs of its profit maximising subsidiary company.

The costs of producing these goods is almost indeterminable due to the opaque nature of data available about Warwick Retail. We are unable to say for sure if they are indeed abusing a dominant position amongst the student market. Students have a high propensity to consume coffee; that much is obvious and Warwick Retail are in a privileged position to be occupying so many cafes on campus. Whether or not exploitative pricing is occurring, there certainly needs to be more competition on campus for the provision of food and drink to improve choice, quality and price.

I am conducting a survey on campus in aid of my dissertation which hopes to demonstrate that Warwick Retail is abusing a dominant position. This could have a profound impact on student welfare so please fill it out and help make the difference. Thank you. https://www.esurveycreator.com/s/269d656

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Header Image Courtesy of flickr.com / signalstation