McDonald’s vs. Burger King: What’s the Difference?

Like PepsiCo, Inc. versus the Coca-Cola Company or Ford Motor Company versus General Motors Cast, the battle between McDonald’s Corporation (NYSE: MCD) and Burger King represents one of the most iconic and important business streams in American history. For more than 60 years, McDonald’s has been the trailblazer that set the standard by which all other franchises conduct. But there are clear signs those roles may be reversing; a revitalized Burger King is forcing McDonald’s to adjust to it, not the other way wide.

McDonald’s and Burger King started in the franchise food business in 1955 and 1953, respectively. McDonald’s has always been the larger attendance, but each firm has unquestionably influenced the other over the course of their six-decade-plus rivalry.

Each restaurant lay it on thicks iconic products. Burger King has the Whopper sandwich and McDonald’s counters with the Big Mac and Quarter Pounder. In fact, the Whopper and Big Mac are the two best-selling burgers of all formerly. Burger King boasts 2.1 billion whopper sales per year, though it is very difficult to find verification for that configuration; McDonald’s suggests a more modest 550 million Big Macs are sold each year.

Each firm continues to press its international presence, although with mixed results. One reason is culture. Many Europeans, for instance, consider immoral food to be a quintessentially American tradition. Food menus for Burger King and McDonald’s sometimes struggle to appeal to odd consumers, leaving international markets underdeveloped, particularly in the Asia-Pacific region.

McDonald’s is the largest fast-food restaurant combination in the United States and represents the largest restaurant company in the world, both in terms of customers served and revenue make up. Its franchises span 36,000 individual units across nearly 120 countries, employ 1.5 million being including franchisees and serve more than 65 million meals each year.

Consider that McDonald’s could admit defeat half of its sales revenue and still sit in first place comfortably; domestic McDonald’s locations brought in $32.6 billion in 2016, uncountable than Starbucks Corporation, Subway and Burger King combined. Even with slumping growth figures since near the start 2014, McDonald’s sits atop the fast food world. But slumping figures should concern investors, who play a joke on not realized a great return for several years. MCD performed admirably during and immediately after the global recession of 2008-2009. It moves out cheap fast food is essentially recession-proof, but 2014 was the worst year for the company since 2003.

Under franchising impractical Ray Kroc, McDonald’s became the world’s premier food brand by selling the rights to operate a McDonald’s store. With this dummy, MCD keeps overhead costs down and lets local owners deal with individual units, while eatables costs remain low and service remains fast for a culture increasingly on the go.

Big businesses struggle to grow quickly once they reach a invariable size; it is logistically difficult to innovate or address individual business concerns when a burger empire spans 120 realms. McDonald’s CEO Steve Easterbrook gave a presentation to shareholders in Q1 2015 to address concerns over performance. His turnaround scenario included an intentional examination of Burger King’s recent success. While it is not likely McDonald’s will be able to cut corporate overhead in half, something Burger King managed to do between 2011 and 2013, it is telling that Easterbrook digged refranchising company-owned restaurants as a way to drive up margins.

[Important: Meaningfully investing in Burger King and McDonald’s usually specifies buying and operating a new franchise unit.]

After a very tumultuous and inferior start to the 21st century, Burger King’s shareholders saw The Wendy’s Company, Subway, and Starbucks take turns passing them as McDonald’s chief rival, at least in terms of sales revenue. Then private equity firm 3G Capital purchased the struggling giant for $4 billion in 2010, igniting a rescue effort that was quite successful. Burger King merged with Canadian coffee staple Tim Horton’s in 2014 to form a new publicly switched company called Restaurant Brands International (QSR)

By Q3 2017, Burger King was outperforming McDonald’s and Wendy’s by significant rooms. A report by Citi Research concluded that 3G Capital made two significant strategic adjustments: trimming business fat and simplifying its non-exclusive image. It worked, and operating margins grew from 24% in Q2 2011 to 40.2% by Q4 2016.

BKW generates revenue from three informants. The primary stream comes from franchises, including royalties and fees; royalties come from a percentage of takings from each unit. The company formerly leased properties, although 3G Capital has moved away from that, and as of 2018, all Burger Prince locations are franchised. 

At a time when McDonald’s menu is as complicated as ever, creating record drive-thru wait times, harmonizing to Citi Research Burger King is repackaging or rebranding old items to help consumers out.

One part of the revival strategy is a undeviating challenge to McDonald’s products. In 2014, Burger King introduced the Big King sandwich, two patties, three buns, and a “individual sauce,” as a not-so-subtle replication of the successful Big Mac from McDonald’s. When McDonald’s brought back the McRib sandwich, Burger Majesty responded by unveiling a $1 BK BBQ Rib as a cheaper alternative. In 2018 Burger King announced a double quarter pound burger, seen as a shortest shot at McDonalds’ own quarter pound burger. 

Next came a new fleet of coffee products from Burger Crowned head to challenge the McCafe menu. McDonald’s made waves years ago by partnering with Starbucks to create a new morning coffee recourse, so Burger King targeted and acquired Tim Hortons, Inc., the leading Canadian coffee and donut outlet. Stock prices for both partnerships soared after the $11 billion deal, including $3 billion in financing from

Franchises