Australia’s cafe economy slips 1.4% YoY as customer traffic falls
The average cup rose 1.65% to $4.69, its smallest annual increase since 2020.
Australia’s $10.15b cafe economy is showing signs of a shift in customer behaviour, with spending down 1.4% year-on-year (YoY) in June 2026, according to a new report from order-ahead marketplace Hey You and Westpac DataX.
The decline was driven by fewer customers and visits, rather than lower spending by people who did visit.
Average annual spend per customer was almost unchanged at $87.73, compared with $87.79 a year earlier.
Coffee prices also remained relatively stable. The average cup cost $4.69 in June, up 1.65% from a year earlier.
That was the smallest annual increase since 2020 and well below the broader rate of inflation.
Prices varied considerably by state. Queensland recorded the largest increase, at 7.8%, whilst Tasmania had the highest average price at $5.44.
Victoria had both the smallest annual increase, at 1.1%, and the lowest average price, at $4.61.
Menu prices, however, do not capture the full extent of pricing pressure on cafes. Discounted orders increased 90% YoY, whilst customers were slightly less likely to pay for larger sizes or milk substitutions.
Upsizes fell 1% and paid milk modifiers declined 2%, pressuring revenue without necessarily raising advertised prices.
Cafe operators are also facing higher costs for ingredients and labour, alongside the Reserve Bank of Australia’s planned ban on card surcharges.
Many are choosing to absorb those costs rather than immediately raise menu prices.
Two-thirds of operators surveyed by Hey You said they had no plans to change prices because of the surcharge ban.
The survey of more than 600 Australian cafe operators found that 83% had noticed a decline in visits.
Sentiment about the next year was mixed: about half were concerned, whilst one-third remained optimistic.
Customer behaviour is also diverging sharply by age. Visit frequency is falling amongst every group under 55, with the largest decline amongst customers under 35.
Amongst older customers, visits increased: by 1.9% for people aged 65 to 74 and by 4% for those aged 75 and over.
Older customers also spend more per visit. Customers aged 75 and over averaged $21.81 per visit, compared with $15.98 amongst 18- to 24-year-olds, a difference of about 36%.
Matcha was the fastest-growing drink on Hey You, with orders up 133% YoY.
Most of that growth came from customers under 35, the same group cutting back most sharply on visit frequency.
In-person spending still dominates, accounting for 93% of cafe spending. Online ordering was the only channel to record growth, rising 4.1% YoY.
Online orders had a much higher average value, at $47 compared with $17 for in-person purchases, reflecting the use of pre-ordering for groups, workplaces, and larger orders.
