Starbucks raises price 10 cents for 'tall' drinks

Starbucks is raising some prices regionally as it faces tough competition and rising ingredient costs.

The Seattle coffee chain is raising prices about 1% in the Northeast and Sunbelt regions.

The price for a "tall" coffee will go up 10 cents in the regions, and the chain will raise prices on about six other beverages. But beverages that are "grande," the next size up, won't change.



Starbucks (SBUX) won't disclose all of the states in which it is raising prices, but the regions include New York, Washington, D.C., and most Southern states, excluding California and Florida.

Other cities where it will raise prices include Boston, Atlanta, Dallas and Albuquerque, N.M.

Starbucks spokesman Jim Olson says the prices reflect competition in certain markets and higher costs for coffee, fuel and other commodities.

Starbucks has been a standout among its peers in the tough global economy because consumers have returned to small luxuries like lattes.

But it is faces challenges, ranging from the drag of a weak economy on its customers to higher costs.

It has expanded overseas, increased the number of products it offers, expanded its loyalty program and upped its presence in grocery stores and other retailers to help drive growth.

The last across-the-board price increase was in 2007.

The company's shares fell 43 cents or about 1% to $45.58 in afternoon trading.

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