URGENT UPDATE: Chicago coffee shop and bar owner Michael Salvatore has confirmed significant price increases due to ongoing tariffs and economic uncertainties. As of September 2023, Salvatore’s Heritage Hospitality Group, which operates multiple establishments including Froth and Heritage Bikes & Coffee, is facing a crisis reminiscent of the challenges encountered during the COVID-19 pandemic.
Salvatore disclosed that coffee prices have risen sharply across his brands, citing a need to adjust to soaring costs. For instance, a cappuccino at Froth now costs $4.75, up from $4.50, while a 12-ounce drip coffee surged from $3.00 to $3.15. This pattern of price hikes is expected to continue as Salvatore evaluates other items, including pastries and packaged drinks.
The owner stated, “It feels like tariffs are hitting almost every aspect of the business.” He emphasized that costs for essential goods, from coffee beans to paper products, have skyrocketed due to both tariffs and supply chain issues. “Every line item in our expense sheet has gone up,” he added.
In response to these financial pressures, Salvatore has implemented a hiring freeze and cut staff—decisions he described as necessary for survival. “We’re being extremely selective in our hiring,” he stated, noting a streamlined operation to maintain efficiency.
Salvatore’s company, established in 2011, has not only survived but thrived in terms of revenue, yet the net profit remains alarmingly low. He noted, “Even with great revenue coming in, we have less margin for profit to pay our folks.” This stark reality is forcing him to make tough choices, including reducing employee shifts and eliminating certain managerial roles.
The uncertainty surrounding tariffs, labor, and political climate has left many business owners like Salvatore feeling they are operating in a “hurricane.” He expressed frustration over the lack of clarity in the current economic environment, stating, “You can’t operate a business with uncertainty.”
Despite the challenges, Salvatore remains committed to his customers and employees. “It’s always been about the people,” he said, reflecting on the connections he has built within the community. His teenage son even works at the coffee shop, adding a personal element to the family-run business.
As Heritage Hospitality Group continues to navigate these turbulent times, Salvatore urges both customers and fellow business owners to remain resilient. He plans to adjust prices strategically over the next two months, ensuring the company can continue to provide quality service while managing rising costs.
The situation is developing, and the impact of these changes on the Chicago hospitality scene is expected to be significant. Observers are advised to stay tuned as businesses adapt to these pressing economic pressures.
