) is reportedly planning to start selling packaged coffee at
supermarkets and grocery stores in the U.S. by early 2015 in
collaboration with Kraft Foods Group, Inc. (
). As per media reports, McDonald's will roll out ground and
whole-bean coffee bags, as well as single-cup pods that can be
easily used at home coffee machines.
Packed in 12-ounce bags, this take home coffee will be available in
various flavors, which include premium roast, breakfast blend,
French roast, Colombian, premium roast decaf and French vanilla and
hazelnut plus a French roast whole bean. However, prices of these
bags were not disclosed.
McDonald's and Kraft Foods had reportedly tested the packaged
coffee in selected markets in 2013. The new offering is expected to
cash in on the huge demand for at-home options.
McDonald's is focusing on the domestic retail coffee market as it
holds immense potential. With the introduction of popular specialty
drinks such as Pumpkin Spice Lattes, Frappes and Caramel Mochas,
McDonald's has been ramping up its coffee offerings since the
introduction of its McCafe brand in 2009. Since then, its coffee
sales have surged 70%. This justifies the company's decision to
come up with a new offering in this multi-billion dollar, U.S.
retail coffee market.
However, we would like to remind investors that it would not be
easy for McDonald's to grab market share in packaged coffee sector
which is dominated by other chains like Starbucks Corporation (
) and Dunkin' Brands Group, Inc. (
) who already sell branded packaged coffee at retailers. McDonald's
currently has a Zacks Rank #4 (Sell).
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STARBUCKS CORP (SBUX): Free Stock Analysis
MCDONALDS CORP (MCD): Free Stock Analysis
DUNKIN BRANDS (DNKN): Free Stock Analysis
KRAFT FOODS GRP (KRFT): Free Stock Analysis
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