How McDonald's Plans to Profit From Its $9.99 Dinner Box

Business Insider
Analyzing the top news stories across the web
June 25 2014 11:19 AM

How McDonald's Plans to Profit From Its $9.99 Dinner Box

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That drink cost extra.

Photo by Justin Sullivan/Getty Images

This post first appeared in Business Insider.

McDonald's Dinner Box promotion offers two Big Macs, two regular cheeseburgers, 10-piece Chicken McNuggets, and four small fries for $9.99. 

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Ordering the dinner box is $8 cheaper than purchasing the items individually. You can add drinks for just $1 each. McDonald's also has two other boxes circulating around the US. One is the Ole Box, which is a World Cup promotion that features two Big Macs, a 20-piece Chicken McNuggets, two medium fries, and four medium drinks for $14.99. The other, the Mickey D's Value Pack, contains four McChicken sandwiches, four cheeseburgers, a 20-piece McNuggets, and four medium drinks for $14.99.

A McDonald's spokesman said 6,500 US stores are offering some variation of bundle boxes.

How can McDonald's turn a profit on these outrageous deals?

The short answer: they probably aren't, at least not yet. 

McDonald's is probably losing money in the short-term in order to gain customers over time, Sean O'Keefe, a professor in the Food Science department at Virginia Tech, told Business Insider.  "I expect this is a loss leader to get people into the store," O'Keefe said. 

The fact that drinks aren't included in the deal will also help McDonald's make money, O'Keefe said. Soft drinks typically cost just a few cents to make, but sell for about $2. "I expect they break even with this or have a small profit, but the promotion gets McDonald's on people's radar and in the door," he said. "There appears to be a lot of buzz for this promotion...so it certainly is advertising to boot."

McDonald's profits slipped during the first-quarter of this calendar year, as sales declined by 1.7 percent in the US.

Allan Smith is an intern at Business Insider.

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