| 2 March 2024, Saturday |

McDonald’s tests CosMc’s stores as burger chain boosts beverages focus

As part of its ambitious development goal, McDonald’s (MCD.N) is going to test a smaller-format concept restaurant dubbed “CosMc’s” that will sell cold beverages including flavored iced teas and slushes.

As part of a small test run, the business’s first CosMc’s store will open this week in Bolingbrook, Illinois, the company announced on Wednesday during its investor day.

By the end of 2024, McDonald’s plans to open roughly ten pilot locations; the remaining locations will likely open in Texas, according to CEO Chris Kempczinski. He said that the business will spend at least a year analyzing the test areas’ outcomes.

“While the number of locations is not particularly concerning to the industry, it will likely put somewhat of a valuation cap on Starbucks and Dutch Bros,” Guggenheim analyst Gregory Francfort wrote in a note.

Based on McDonald’s alien character CosMc, which appeared in a series of advertisements in the 1980s and 90s, the CosMc’s stores will also test Drive-Thru pickup lanes and cashless payment devices to boost service speed.

With drinks such as “Sour Cherry Energy Burst” and “Blueberry Ginger Boost”, CosMc’s could allow McDonald’s to tap into the growing popularity of mixed cold beverages in the U.S., a trend that has boosted sales at coffee giant Starbucks (SBUX.O).

CosMc’s will also offer some popular McDonald’s menu items such as the McMuffin, as well as new sandwiches and snacks.

  • Reuters