McDonald’s Thumbs It Nose At Starbucks

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By Douglas A. McIntyre Published

The quote is a classic. From Reuters: "You can’t get much better profit than adding water to beans," McDonald’s USA President Don Thompson said at an investor conference last week.

Yes, and that means that competing with Starbucks (SBUX) is not terribly hard for McDonald’s (MCD). It already has 36,000 stores worldwide. The Specialty Coffee Association says that the market for premium coffees is now over $12 billion a year.

There is a theory that the premium coffee market is growing so fast that Starbuck’s will not be hurt by the competition. "It will expand the market rather than impact Starbucks," said Bob Goldin of restaurant research firm Technomic Inc.

Wrong. People can only drink so many cups of coffee a day.

Douglas A. McIntyre

Photo of Douglas A. McIntyre
About the Author Douglas A. McIntyre →

Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.

His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.

A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.

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