Starbucks, Dunkin' Donuts, and McDonald's have been waging a public battle over the hearts — and wallets — of coffee drinkers. But all the while, says Jason Notte at Newsweek, lower-profile coffee concerns have been making a killing by selling to home brewers and businesses, appealing to the ubiquitous "one cup commuter" and office workers looking for higher quality from the Keurig K-Cup single-serving machines in their communal kitchens. But as the price of coffee creeps up and the Big Three rethink their strategies, can single-cup purveyors afford to stay relevant? Here, an excerpt:
By the end of Starbucks' fiscal year last September, revenues were down nearly 6% and same-store sales had dropped 9%. McDonald's, however, didn't fare much better — revenues were down 7% in the U.S. and globally. Even while crediting its frappes for a 12% jump in second-quarter profits and 4% increase in same-store sales, McDonald's has somewhat softened its focus on in-store coffee — briefly annoying Jamba Juice (JMBA) with a foray into smoothies earlier this summer.
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