McDonald’s, run by the McDonald's Corp. (MCD), is a quick-service restaurant chain that competes directly with other quick-service brands such as Burger King, Wendy’s (WEN), Taco Bell, KFC and Subway. Fast-casual restaurants are also close competitors, and this group includes Chipotle Mexican Grill, Inc. (CMG) and Panera Bread Company. Starbucks Corp. (SBUX) is a specialty quick-service brand with some offerings overlapping those of McDonald’s. Internationally, McDonald’s faces competition from some of the largest fast food chains in addition to regional competitors and smaller local restaurants.
McDonald's has more than 37,000 locations in more than 100 countries, and the majority of its restaurants are franchised. The company reported revenue of $22.8 billion in 2017, and as of November 2018, its market cap is $89.2 billion. The burger giant continues to make changes aimed at increasing its market share. In September 2018, for example, the chain cut out artificial ingredients from its seven classic burgers: the hamburger, cheeseburger, double cheeseburger, McDouble, Quarter Pounder with Cheese, Double Quarter Pounder with Cheese and Big Mac. Here's a look at some of McDonald's main competitors.
Starbucks is the world’s largest coffeehouse chain. As of November 2018, the company operates more than 28,000 stores in 76 countries, including more than 14,000 in the United States. None of the company’s U.S. locations are franchises. Starbucks serves coffee, espresso, cappuccino, tea, pastries, sandwiches and other foods and markets itself as a high-quality option at a high price point. The company reported fiscal 2017 revenue of $22.4 billion, making Starbucks the second highest-selling U.S. chain restaurant behind McDonald’s. As of November 2018, Starbucks’ market cap is $89.2 billion.
Yum Brands, Inc.
Yum! Brands, Inc. (YUM) operates several large quick-service restaurant chains including Taco Bell, KFC and Pizza Hut. As of November 2018, the company has more than 45,000 restaurants in more than 140 countries 135 countries, and more than 97% of them are franchised. The company's revenue exceeded $5.9 billion in 2017. Taco Bell serves fast food breakfast and lunch dishes inspired by Mexican cuisine, including tacos, burritos, nachos and related specialty items. KFC serves various chicken dishes and sandwiches, along with sides and beverages. Pizza Hut is a quick-service pizza restaurant chain. As of November 2018, Yum! Brands’ market cap is $27.8 billion.
Chipotle is a fast-casual restaurant chain serving tacos, burritos, bowls and salads. The company was formed as a spinoff from McDonald’s with a 2006 initial public offering (IPO). Chipotle operates more than 2,460 locations in the U.S., Canada, the United Kingdom, Germany and France, none of which are franchised. The company has a higher price point than its fast food competitors, and its slogan is "food with integrity." Chipotle reported 2017 revenue of $4.5 billion. As of November 2018, Chipotle’s market cap is $13.1 billion.
Subway is the largest restaurant chain in the world in terms of size, with nearly 44,000 locations in 110 countries in 2017. All Subway locations are owned by franchisees, of which there are more than 21,000. The company’s menu consists primarily of sandwiches and salads. Subway reported 2017 sales of $11.3 billion in the U.S., but its sales have been falling since 2012. It's a privately held company, so it isn't traded on any stock exchange.
Wendy’s is a fast-food restaurant chain with more than 6,000 locations worldwide. Its menu includes hamburgers, sandwiches, chicken products and side dishes. The company reported 2017 revenue of $1.27 billion, though total system sales were higher because sales at franchised locations are not included in consolidated revenues. Wendy's has a reported market cap of $4.2 billion as of November 2018.
As of February 2018, Burger King had more than 16,000 locations in more than 100 countries, with roughly 11 million daily visitors worldwide. Nearly all of those locations are owned by independent franchisees. The company’s menu includes breakfast, lunch and dinner items available a la carte. Hamburgers, chicken sandwiches, chicken tenders, French fries and beverages are categories featured on the menu. Burger King recorded over $1.2 billion in revenue during 2017, and it's owned by parent company Restaurant Brands International, which also owns Tim Hortons and Popeyes.