Starbucks and McDonald’s Team Up to Create a New Sustainable Cup

July 18, 2018, 1:25 PM UTC

In the coffee kingdom, Starbucks and McDonald’s are always fighting for top spot. But when it comes to sustainability, the multibillion-dollar global giants are on the same team—for now.

McDonald’s and Starbucks are joining forces to build a fully recyclable, compostable cup within the next three years. The companies—two of the top three most popular food chains worldwide—plan to transform the way single-use cups are made and disposed.

Together, both companies distribute a combined 4% of the world’s 600 billion cups annually. While each company’s current cups are technically recyclable, they seldom are due to practical matters related to recycling infrastructure around the country.

News of eco-friendly partnership comes on the heels of the recent initiative of players in fast food industry—such as Chipotle, Subway, and Burger King, among others—to reduce plastic in packaging. Earlier this month, Starbucks announced its own initiative to ban straws altogether by 2020.

For now, the two fast-food giants hope to create a revolutionary, single-use cup by calling on entrepreneurs, both large and small. Launched by Starbucks and Closed Loop Partners earlier this year, the NextGen Cup Challenge invites the public to develop materials and designs that could transform the way we consume our morning joe. The challenge will provide grants to promising ideas to combine them into market-ready solutions.

Formally launching this September, the competition will be run by OpenIdeo. As of now, Starbucks has contributed $5 million to the fund, and McDonald’s recently matched that.

While McDonald’s and Starbucks are usually staunch competitors in serving our caffeine fix, both companies want to use their collective scale to combat the scale of the packaging problem.

“There are certain things we’d say that we’re not competitors on. We all have to come with solutions and make sure we’re watching out for the public’s interest. This is something that we see as kind of similar. It’s a societal issue, and there’s a way that we can come together, not as competitors, but as problem solvers. We can use our collective scale to make a difference,” Marion Ross, the McDonald’s chief supply chain officer in the U.S., told Fast Company this week.

McDonald’s insists packaging materials do not offer a significant competitive advantage since materials are being optimized for impact, not cost.