On Wednesday, McDonald’s announced an aggressive expansion roadmap, targeting 50,000 restaurants worldwide by 2027. The chain also shared plans to introduce CosMc’s, a new network of small-format shops with a focus on cold beverages.
The fast-food giant, which had 40,275 restaurants at the end of 2022, aims to rapidly expand its network of flagship locations by about one-quarter, marking the speediest expansion in the brand’s history.
Regarding CosMc’s, a concept alluded to by McDonald’s executives in July, the company intends to open its first store in Chicago in 2024, followed by nine additional locations in Texas. This initiative is reminiscent of an animated orange character with six arms featured in McDonald’s marketing from 1986 to 1992.
According to the company’s website, CosMc’s is characterized as being “inspired by nostalgia” and features a menu that includes beverages like S’mores Cold Brew and Sour Tango Lemonade, as well as sandwiches and baked goods.
Speciality beverages and coffee are a fast-growing $100 billion category and “a space that we believe we have the right to win,” Chief Executive Chris Kempczinski said at an investor day.
McDonald’s, having rapidly expanded during mid-century America, currently holds the top position as the largest chain in the fast-food industry, slightly surpassing Starbucks and Subway, both prominent global brands.
To facilitate the expansion, the company intends to allocate approximately USD 2.5 billion in capital expenditures in 2024, with additional annual increments ranging from USD 300 million to USD 500 million until 2027.
Manu Steijaert, Chief Customer Officer, mentioned that the current expansion is advancing at a much faster pace compared to the previous increase from 30,000 to 40,000 restaurants, which spanned over 18 years.
“Hopefully you can feel the confidence we have in McDonald’s’ development potential over the next four years and beyond,” Steijaert said.
Recent sales growth has been driven by new offerings, including the well-received “McCrispy” chicken sandwich. The chain has additionally experienced increased online orders in the wake of the Covid-19 pandemic, and its reputation for affordability has helped maintain customer traffic amid a period of heightened inflation.
The chain forecasted a nearly two percent increase in revenue for the year 2024.
