McDonald’s wants to sell more chicken and more beverages, but where it sells the latter from remains to be seen.
Executives with the fast-food giant on Monday reiterated plans to boost chicken sales with products like chicken strips, the return of the Snack Wrap and a periodic reintroduction of the Chicken Big Mac as a limited-time offer.
They also suggested there’s plenty of demand for beverages in a drive-thru format. Yet, for the first time, they said that the drive-thru format could be traditional McDonald’s locations and not necessarily the beverage-focused CosMc’s concept.
“As we further refine our plans [for CosMc’s], I think you’ll hear more from us about how much of that opportunity needs to come through new units with something stand-alone like CosMc’s, or how much of the potential do we think we can capture by doing more within the existing restaurants,” CEO Chris Kempczinski told analysts Monday. “There’s a lot of work thinking about what we might be able to do to capture that opportunity in the current restaurant.”
McDonald’s opened its first CosMc’s in a Chicago suburb in late 2023 to long lines. The company then opened a half-dozen restaurants in Texas. It has since closed three of those Texas locations, which are either larger locations or end-caps without a drive-thru. It still plans two more locations.
Kempczinski said that smaller CosMc’s locations with drive-thrus work better. He said the test has confirmed executives’ belief that there’s demand for drive-thru beverages. “There’s certainly an opportunity in that space,” he said.
Drive-thru beverages are taking off in the U.S. restaurant industry, as brands like Dutch Bros, Scooter’s, 7 Brew and the soda concept Swig add locations across the country.
“That category is growing about two times the rest of the business with strong margins,” Kempczinski said. Unsurprisingly, other major brands are looking at beverages in some capacity, too. Beverages are a huge component of the Saucy concept that KFC is testing in Orlando. Sister chain Taco Bell is also testing a beverage concept called Live Mas Café.
At the same time, however, McDonald’s might be able to capture that market more quickly with its existing brand and some franchisees have said privately that they would love some of the CosMc's beverage items on their own menu. McDonald’s already has 13,500 U.S. locations, most of which have drive-thrus as it is.
“We’re certainly bullish on the opportunity in beverages, both in the coffee side, whether it’s hot or iced, but also in some of these other beverage areas that you’re seeing emerging, like refreshers, like energy drinks, etc., etc.,” Kempczinski said.
McDonald’s already does a hefty business in chicken, thanks to products like Chicken McNuggets, the McChicken and the McCrispy.
And executives have long insisted they plan to sell even more chicken, given that consumers eat more chicken now than they do beef.
On Monday, they said the plan is to gain another point in chicken market share in the fast-food industry by the end of 2026. Globally, McCrispy is in 70 markets and will be in all markets by the end of this year.
In the U.S., the company generated strong sales with the Chicken Big Mac last year. But that introduction was offset by sales lost when E. coli hit out West. Consumers ate fewer Quarter Pounders, or avoided McDonald’s altogether, which wiped out potential sales growth.
The addition of chicken strips this year would enable the company to reintroduce Snack Wraps, which have traditionally been made with a chicken tender. McDonald’s announced the plan return of the product last December as it worked to rebuild consumer enthusiasm following the outbreak.
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