Why Loose Tea Costs Less Than Milk

When I was in High School my Mother sent me to the store to buy some milk. I only had $5 at the time and she told me to get the best deal that I could. What I ran into was a shelf full of white cartons that were all different sizes and shapes.

The smaller ones were less expensive, but looked like they only contained a few cereal bowls worth of milk. The large ones held three times as much, but didn't seem that big. I stood there staring at the cartons for five minutes with no idea how to figure out which one was the best deal. I think we can safely say that I was confused. If I was confused when I went to buy milk, imagine the feeling I had when I bought loose tea for the first time. I sat there looking at a bag of tea and what seemed like a large price tag. After all, I could get a box of 20 teabags for much less than a bag of loose tea.

Thankfully, the store owner was there and explained to me the best way to figure out how much the loose tea really costs when compared to the tea bags. "The basic principal is unit cost, but in the tea world it is referred to as cost per cup," she said. Luckily for me, once I worked out the numbers, I found out that loose tea is actually cheaper in a lot of cases than bagged tea and I can thank that revelation to "cost per cup."

What is Cost per Cup?

Cost per cup, or CPC, is a method of determining how much one serving of tea costs. Because some teas are fluffier than others, simply looking at the size of the tea is not a good way of determining value. Instead, it is better to measure the weight of the tea. There is a full explanation on the way we calculate CPC at the bottom of this article. For now, let’s just focus on the CPC of loose tea.

What is the CPC of Loose Tea?

Loose tea prices can either be very high or very low depending on the quality. For a premium quality loose tea you should look to pay roughly $50 per pound. This price broken down into individual servings sizes gives us a CPC of 28 cents.

How does that compare to every day beverages?

Here is a list of every day beverages broken down into individual serving sizes:

Starbucks Coffee - $9.99 per 12oz (37.5 servings in 12oz of coffee) – 27 cents CPC
Deer Park Bottled Water – 12 pack of 8oz bottles - $2.99 case – 25 cents CPC
Florida’s Natural Orange Juice – 64oz carton - $3.99 – 36 cents CPC
Diet Coke - 12 pack of 12 oz. cans - $5.99 – 24 cents CPC
Loose Tea – 28 cents CPC

Money is tight. Is there a way to reduce the CPC even further?

Unlike most of the products above, you can reuse loose tea a few times. All you need to do is re-steep the same tea. Because of this, you can get two or three servings per 2.5 grams of tea, which will bring the CPC down from 28 cents to roughly 7 cents per cup.

At 7 cents per cup, loose tea becomes much more affordable than most common beverages. Just like when you are buying milk, ignore the sticker price they are charging you. Instead, look for the unit cost. The amount of money you can save will be staggering.

photo: www.flickr.com/photos/szb78/8383710481/