McDonald’s Coffee Is Driving Away Customers

McDonald’s Coffee Is Driving Away Customers

ASHLEY LUTZ NOV. 12, 2013, 12:35 PM 6,384 12

McDonald’s has spent years offering new coffee products to compete with Dunkin’ Donuts and Starbucks. But the McCafe is starting to hurt business at McDonald’s, Howard Penney, managing director at Hedgeye Risk Management, tells Yahoo! Finance. “They went too far on the beverage initiative beginning in 2009 and really hurt the core business,” Penney tells Yahoo!. “They’re really losing customers at lunch and the stores are a little too inefficient because of the distractions they’ve put into the stores.”Complicated drinks like Pumpkin Spice Lattes and Chocolate Chip Frappes are distracting employees from McDonald’s core business, Penney said. 

“McDonald’s is known for food first, beverages second. Starbucks is known for beverages first, food second. Whenever you deviate from your core competency, something has to give,” Penney said.

Perhaps simplicity could benefit McDonald’s by improving customer service.

Wait times at McDonald’s drive-thrus are the longest in at least 15 years, according to a recent study by QSR Magazine.

McDonald’s told franchise owners earlier this year that one in five customer complaints are related to customer service, and that number is growing all the time, according to The Wall Street Journal.

About bambooinnovator
Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (, the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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