When McDonald's starts buying ingredients, it tends to buy a lot of them. For example, the company sells 9 million pounds of fries every day, which means that it needs to purchase hundreds of millions of pounds of potatoes each year.
That huge appetite for food has had Buffalo Wild Wings' investors nervous as Mickey D's adds chicken wings to its menu nationwide. The worry is that McDonald's could buy up so many wings that it pushes prices up and cuts into B-Dubs' profits. But that doesn't appear to be happening.
In the video below, Fool contributor Demitrios Kalogeropoulos says that Buffalo Wild Wings' management isn't concerned about wing prices jumping up on account of the fast-food king and that clears the way for a big improvement in B-Dubs' profit margin in the second half of 2013.
The article 1 Reason Buffalo Wild Wings Isn't Afraid of McDonald's originally appeared on Fool.com.Fool contributor Demitrios Kalogeropoulos owns shares of McDonald's and Buffalo Wild Wings. The Motley Fool recommends and owns shares of Buffalo Wild Wings and McDonald's. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
Copyright © 1995 - 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.