mc donalds owners eye starbucks with
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MGM221PRESENTATION
Cover page needed to be edited Someone please think of a good
Cover page! I am not too good at this^^
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ABOUT THIS ARTICLE&
ABOUT MCDONALD’S
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McDonald’s company background
• franchise company • founder Ray Kroc • >30,000 local restaurants • serves 52 million people in over 100 countries• >70% restaurants owned & operated by local peo
ple
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Julia
• Please add ur company info here
• You need at least 4 slides
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julia
• Please add ur information here
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• Popular food: French Fries, Big Mac, Chicken McNuggets
• competitors: fast food stores --> Burger King (food), Starbucks (Beverages)
• customers: mainly families with children --> more young adult customers
• will add other beverages next year
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McDonald's owners eye Starbucks with McCafe drinks
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• McDonald’s offers McCafe espressos and cappucinos at 14,000 US locations
• McCafe’s coffee drinks cost less than StarBucks, from $2.39 for a small to $3.29 for a large
• McDonald’s first gained revenue from offering coffe in the breakfast menu
• “Beverages have higher margin than food” • Offers Lower price “affordable luxury”
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McDonald’s strategy to gain market share from Starbucks
• Next annual sales: $1 billon
• Continue improve their coffee bean quality to compete with StarBucks
• Advantage by offering food and coffee while StarBucks only has muffins and coffee
• Draw attention to price sensitive customers
• US economy downturns
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improved furniture and free Internet service• Attract people to come and sit in McDonald’s as they do in Starbucks
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Jenny will explain what’s this commercial..
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McCafe and the Investors-Christine and Judy
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• Hefty return on sales– Expecting additional $1 billion to annual sales – Expect more money retained within the
company or give out dividends – Increase operating expenses
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What can investors expect?
• Higher revenues• Strong market advantage in new coffee market• Higher share prices• Increase in sales• Greater return on investments > McDonald’s raised dividends 33%• Continuous growth with second beverage wave
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McCafe – The Store
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What is a McCafe store?
• Starbuck’s-like coffee shop
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Different kind of drinks McCafe offers
Frappes
Iced latte Iced mocha
smoothie Bottled water
tea
Macchiato Flat white espresso
cappuccino
Long black
Iced coffee
vienna
Hot chocolate
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Spring 2001: first McCafe opening in US
> Test run in downtown Chicago
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How will investors be affected?
• New source of growth >New restaurants reaching point of diminished returns
• Commercial (?)
• Increase in revenues
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McCafe and the economy
• New Bailout Plan