McCafe

When the neighborhood McDonald's revamped their interior and put in a machine for making exotic coffee drinks, I smugly said to myself, this is going to be a huge flop. Starbucks has the corner on this type of drink and McDonald's customers will never pay the higher price for exotic coffee. The clientele for these enterprises come from two different worlds. McDonald's customers are looking for inexpensive food while Starbucks customers are looking for something out of the ordinary, something that separates them from the common herd. If I had owned McDonald's stock I would have sold it. (Of course, I could have sold short, but that is not what I do.) At this time, the McCafe business is doing gangbusters. The cashiers have been instructed to ask each customer if they would like to have one of the McCafe drinks. For me, I have always declined but have been astonished at the other people in line calmly ordering one or two of these drinks. The drive in window does a great business selling solitary McCafe drinks. What is going on? Why has this craze started? I am told the drinks are heavily fortified with caffeine and have a strong taste. I talked to Pat and she said she had a Mocha drink and it had a delightful, creamy, chocolate taste. She once had one late in the evening and could not sleep that night. It is obvious that some McDonald's customers have enough money to pay a higher price for their drink. Are people being lured away from Starbucks? The people I usually see in McDonald's have the appearance of being on a food budget. Yet, these drinks are being sold and the initial investment is indeed paying paying off. It is obvious that I do not know the food business, McDonald's does. It is a good thing that I am not the deciding executive at McDonald's. I hope Obama does better with General Motors than I would have done with McDonald's.