Boston, MA 09/15/2014 (wallstreetpr) – McDonald’s Corporation (NYSE:MCD) recently announced a new concept that is expected to boost its performance, especially in the breakfast segment. However, a number of industry observers have already weighed in on the development with varied views. The question is whether the company has any chance to survive in the competitive breakfast market given that it is no longer the dominant player in its industry.
At CNBC, Carol Roth looked at McDonald’s new concept known as ‘McBrunch’. She expressed concern that the company is not performing well and one of the reasons for that is that McDonald’s is not paying attention to customer demand. As such, chances are slim that ‘McBrunch’ would lead to any significant positive impact on the company’s sales. Some of the issues hurting McDonald’s is that the company is not implementing new technologies to boost sales.
Focus on margins
However, Hake Capital Management’s Mark Hake differed with Roth, citing that McDonald’s Corporation (NYSE:MCD) is doing all that it should do to boost its performance. He stated that while the stock has declined in the recent months, the company could catch up by aggressively focusing on margins. As such, he hopes that ‘McBrunch’ would be a permanent offering.
Commenting on their ‘McBrunch’ breakfast concept, McDonald’s Corporation (NYSE:MCD)’s CFO, Peter Benson, said that they have been serving breakfast for more than 30 years now and it remains their strongest business area in terms of profits. He said they would continue to focus on breakfast offering.
Breakfast bring $50 billion per year
Breakfast offering in fast-food stores brings in about $50 billion in a year and it has been in a big growth area in the past few years. Market data revealed that between 2007 and 2012, breakfast offering accounted for about 90% increase in fast-food stores sales in the years.
As for McDonald’s Corporation (NYSE:MCD), the major challenge is the entry or expansion of players like Starbucks Corporation (NASDAQ:SBUX), Burger King and Taco Bell in the breakfast market.