A Tale Of Two Food Giants

(CBS)  The economic downturn has become a bitter brew for Starbucks, but McDonald's is lovin' its latest results.

Consumers are making it clear, observed Early Show National Correspondent Hattie Kauffman Tuesday, when it comes to food, inexpensive is hot, pricey is not.

The sagging economy took a Venti-sized gulp out of Starbucks earnings, while McDonald's was seeing beefy sales.

Starbucks profits plunged 97 percent in its latest quarter compared to the same three-month span last year, down from $158.5 million to $5.4 million.

Part of the drop was due to the cost of closing stores here and oversees, the company reported, but it's also seeing customers cut back on those expensive drinks.

"We drink coffee at home now, pretty much always" one woman told Kauffman, "and then just, maybe once a week, we'll have coffee out."

McDonald's first took on Starbucks last year, when it introduced its premium coffee. Now, overall same store sales for McDonald's rose 8.2 percent last month, fueled mostly by folks looking for a cheap meal.

"We don't eat out as often, and when we do, we go to the cheaper places," one man said. "We're teenagers, and we don't have much money, so the more we can get for less money is better for us," one teen explained to Kauffman.

At McDonald's, you can buy three cheeseburgers for less than what it would cost you for one Grande Latte at Starbucks, Kauffman pointed out.

It's not just Starbucks that's suffering, she adds. Many restaurant chains are reporting steep declines, as consumers put themselves on a financial diet.

[aldee41]

The point of the article is high vs low dollar not good vs bad food. Kia has an economical car priced less than $7000 and GM is going bankrupt. This is an across the economy situation of serious concern to investors and those who must anticipate supply needs.

[caldwellptr]

It is hard for me to consider a hamburger, fries and a coke a meal. But there are days where working and coming home and cooking just doesn''t cut it. My advice to the young is to pace yourself. If you eat all of the Big Mac''s you desire you''ll be sick of them by your 40''s. Then after a day of work, and then the thought of eating another hamburger is just not that appealing, then you end up cooking (or calling out) anyway.

[dmorrispe]

Allow me to illustrate the last paragraph of my original post "All things considered, there is nothing wrong with "fast food" IF you make intelligent choices and watch your nutrients."

I frequently have dinner at my local Wendy''s outlet. I will order either the Ultimate Chicken Grill sandwich (320 calories, 7 grams fat, 36 carbs) or the Mandarin Chicken Salad (370 calories, 16 grams fat, 30 carbs) without the dressing. I''ll usually have their iced tea sweetened with Splenda. A good nutritious meal, served quickly, for less than $5.00 with tax. I''ll do this on days that I DON''T have time to go home and prepare something to eat due to other engagements/obligations.

Even if I did cook a similar meal from scratch, I would spend about $12-15 just on buns, chicken, lettuce, tomatos, mandarin oranges, sesame crumbles and almonds. Of course, that''s because I can''t buy just enough for my single meal, and I''ll have the leftovers some other day soon. Grilling the chicken would take about 10 minutes over low heat; brewing and cooling the iced tea is another 15 miutes; washing and tearing the lettuce - 2 minutes; slicing tomatoes & chicken - 3 minutes; assembling the meal - another 2 minutes for a total of about 20 minutes (because some items can be done while others are cooking). You get the point, I''m sure.

My time would cost about $3.00, if I was paid at a rate of $10/hour, then there''s the electricity, water, sewer, & propane costs, plus the cost of gasoline to get the items.

[yongamerica]

DMorrisPE - I beg to differ. At my house we can cook hamburgers, fries and a vegetable or salad cheaper than than the numbered meals at McDonalds or any fast food restaurant. The quality of materials can''t be compared because fast food places sacrifice quality for profitability. Can''t comment on the salt, but we use unsaturated oil for frying the potatoes and don''t drink sodas for dinner, major pluses compared to MickeyDs.

Chicken can be made at less expense than hamburger and it doesn''t take the hours you speak of.

In the time it''d take to drive to a fast food place and back all the prep work is done, food is well on its way to the table and the table is set.

As for carbohydrates, if you are watching these things, it''s caloric intake as well as vitamins minerals that are important. Think of how thin most people in Asian nations are, and they consume more carbs than protein. the key is eating healthy and moderation with indulgences.

McDonalds servers some the worse foods as far as a healthy diet goes, plain and simple.

To even suggest that people don''t have time to cook dinner at home underlines two main problems in America, Laziness and lethargy.

[avigil2]

From a 20/20 News report a few months ago, fast food should not be eaten more than twice a month.

[helloall34]

It''s not just America''s problem, it''s a trend across most of the world.

[dmorrispe]

First, what passes these days as "home-cooked" is generally something from the freezer that is microwaved - just like McDonalds.

Second - when (if?) folks prepare a "made-from-scratch" meal, it will ALWAYS cost more than a McDonalds meal, and will usually have just as much salt (maybe more!), butter, carbs, etc.

Then there is the time component. A "made-from-scratch" meal at home will take several hours to fix. Most folks just don''t want to devote that much time from their busy schedules. Crock-pot meals are easy, but still take several hours. Frozen skillet meals are still pre-prepared (by the manufacturer) and usually loaded up with stuff you might not want.

All things considered, there is nothing wrong with "fast food" IF you make intelligent choices and watch your nutrients.

[yongamerica]

McDonalds is no substitute for nutritious home cooked meal. Eating at home is still cheaper than eating at McDonalds. What this says is America has a large population of people that don''t prepare their meals at home for what ever reason. This uptick trend is a symptom of America''s rising problems with obesity, heart disease and poor health.