Dunkin Donuts Essay Example

Dunkin Donuts Paper Notre Dame University BAD 603 Presented to: Dr. Nicolas Khoury Presented by: Charbel Salameh Date: 02/06/10 Company Overview: Dunkin Donuts claims to be the worlds largest coffee and baked goods chain, serving 2. 7 million customers per day at approximately 8,800 stores in 31 countries which include approximately 6,400 Dunkin Donuts locations throughout the USA. This figure compares with the 15,011 stores of coffee chain Starbucks, whose baked goods are usually prepared out of shop. Most Dunkin Donuts stores are franchises. There are no Dunkin Donuts stores anywhere in the state of California, and a notice on the companys web site states that franchises are not being offered in that state. No explanation is given as to why. Only 75 franchisees exist west of the Mississippi River, mostly in Arizona, Nevada and Texas. Key Facts Business Description: Dunkin Donuts, along with Baskin-Robbins, is owned by Dunkin Brands Inc. (previously known as Allied Domecq Quick Service Restaurants, when it was a part of Allied Domecq). Dunkin Brands used to own the Togos chain, but sold this in late 2007 to a private equity firm. Dunkin Brands was owned by French Beverage Company, Pernod Ricard S. A. after it purchased Allied Domecq. They reached an agreement in December 2005 to sell the brand to a consortium of three private equity firms, Bain Capital Partners, the Carlyle Group and Thomas H. Lee Partners. In the U. S. , Dunkin Donuts is sometimes paired with Baskin-Robbins ice cream shops. We will write a custom essay sample on Dunkin Donuts specifically for you for only $16.38 $13.9/page Order now We will write a custom essay sample on Dunkin Donuts specifically for you FOR ONLY $16.38 $13.9/page Hire Writer We will write a custom essay sample on Dunkin Donuts specifically for you FOR ONLY $16.38 $13.9/page Hire Writer While such locations usually have two counters set up for each chain (much like the Wendys/Tim Hortons co-branded locations), depending on business that day both products can be bought at the same counter (usually the Dunkin counter), much like the Yum! Brands stores. History of Dunkin Donuts: It all started in 1946 when William Rosenberg (founder of Dunkin Donuts and also the International Franchise Association) invested $5,000 to form Industrial Luncheon Services, a company that delivered meals and coffee break snacks to customers in the outskirts of Boston, Massachusetts. The success of Industrial Luncheon Services led Rosenberg to open his first coffee and donut shop, the Open Kettle. Then, in 1950, Rosenberg opened the first store known as Dunkin Donuts in Quincy, Massachusetts. Key Employees Executive leadership team is constituted of: Nigel Travis, Dunkin Brands Chief Executive Officer and President, Dunkin Donuts William Bode, Vice President, Northeast Randy Brashier, Vice President, Operating Systems John Costello, Chief Global Customer ; Marketing Officer John Dawson, Chief Development Officer Al Hodges, Vice President, South Central Tony Pavese, Chief Operating Officer, International Joe Scafido, Chief Innovation Officer, Dunkin Brands Major Products Services: Dunkin Donuts has more than 1,000 donut varieties along with other products. * Baked Goods * Donuts Various donuts * eclairs, cop fritters, crullers, bismarcks, and coffee rolls (9 varieties) * Munchkins * Stick donuts (Black)(6 varieties) * Bagels * Scones * Turnovers * Fruit Tarts * Muffins * Danish pastry * Cookies * Brownies * Cinnamon Twists Bagel twist * Breakfast sandwiches * Egg and cheese * Egg and cheese with ham, bacon or sausage * Supreme omelette * Ham and cheese * Hash browns * Oven toasted items * Flatbread sandwiches * Coffee * Bulk Coffee * Espresso, Cappuccino, and Lattes * Iced Coffee, in these flavors: * Blueberry * Caramel * Cinnamon * Hazelnut * Raspberry * Toasted Almond * French Vanilla * Coconut * Iced Lattes * Latte Lite Espresso * Turbo * Other hot beverages * Hot chocolate * Tea * Vanill a Chai * White Hot Chocolate * Dunkaccino * Cold beverages Coolattas * Coffee * Watermelon * Grape * Vanilla Bean * Tropicana Orange * Strawberry * Iced teas * Smoothies Dunkin Deli Dunkin Delis are found in some Dunkin Donuts in the United States. These delis offer a selection of sandwiches, salads, and soups, and are the result of the former ownership of the sandwich chain Togos by Dunkin Donuts parent company. Dietary concerns In August 2007, Dunkin Donuts announced plans to greatly reduce trans fats from its menu items by switching to a blend of palm, soybean, and cottonseed oils. In addition to 400 US stores that took part in a four-month blind test, the low trans fat menu is available nationwide since October 18, 2007. International locations are expected to begin using the new oil within the next few years. Dunkin’ Donuts has launched DDSMART, a healthy new menu. The new items are reduced in calories, fat, saturated fat, sugar or sodium by at least 25%. SWOT Analysis: First of all, let us discuss what the company’s strengths are. Dunkin Donuts is a recognizable and trusted brand. With more than fifty years in the business, customers know Dunkin Donuts. This makes them more likely to try new offerings and return to franchises. It also makes advertising that uses the company name and logo more recognizable, particularly in mailings and in the newspaper. Dunkin Donuts is also recognized by business owners as a good franchise to buy and run, making it further poised for growth with entrepreneurs and in areas where there is little current competition. Finally, Dunkin Donuts is known for its speed of service, simplified menu and drink sizes, and its reasonable prices and fair trade. As for the eaknesses, consumer reviews have revealed that quality of food in certain franchises is not as good as others; hence there is inconsistent quality of Dunkins Donuts. In addition, it cannot be found on every street corner; it mainly dominates the West Coast. It also still needs to create more friendly and calm atmosphere when compared to other competitors. Next we have the opportunities. Coffee consumption is on the increase in Asia, especially in c ountries with rising disposable incomes such as China. There is also a donut craze in many Asian countries including Singapore, Taiwan and Malaysia. With the rise of globalization, the speed of the flow of information quickens, so everything is moving at a faster pace. This is an opportunity for DD as it has positioned itself as a quick stopover to get your beverage or snack fix. There is also a growing acceptance of western influences in countries from the younger generation, where in Taiwan; youngsters would queue in line for hours for donuts. The possibility of a US recession is also an opportunity, because it seems that Americans like to drown their economic woes in rich sugary food, especially if that food is cheap. What else can you share with 12 people that cost fewer than six bucks? Finally, we will move to the threats facing the Dunkin Donuts. The first threat facing DD is the presence of many competitors, like Starbucks, McDonalds and krispy kreme. They can potentially cause a large reduction in DDs market share in coffee and baked foods. Another threat is that there are low barriers of entry into the coffee and donut industry, which actually gives rise to the threat above presence of many competitors. The price of raw ingredients is also increasing, like soybean. It is a threat as DD is now using reformulated cooking oil, made from soybean, for its donuts to eliminate Trans fats. The increase in raw material prices may result in an increase in DDs operating cost. There is also an increasing concern of health issues globally as people are becoming more aware. However this is not a big threat to DD as theyve removed Trans fats from their donuts, and in essence, donuts have been accepted to be popular comfort food. Top Competitors: Most of their business competition comes from small locally owned stores, Krispy Kreme doughnuts and Starbucks; in Canada and parts of the Great Lakes region, Tim Hortons is a major competitor. Mister Donut had been its largest competitor in the United States before the company was bought by Dunkin Donuts parent company. The Mister Donut stores were rebranded as Dunkin Donuts. In the province of Quebec, Alimentation Couche-Tard owns the master franchise to Dunkin Donuts. In the United States, that companys Circle K convenience stores also share some locations with Dunkin Donuts. However, Dunkin Donuts began to close several locations in Quebec within the 2000s because of competitor Tim Hortons opening many Quebec locations. Some Dunkin Donuts locations continue to open in Quebec, most recently at the Lionel-Groulx metro station. Couche-Tard agreed in August 2008 to terminate its role as master franchisee within 12 to 18 months. Moreover, we will discuss the coffee wars that exist between Dunkin Donuts and Starbucks. With its Free Iced Coffee Day promotion Tuesday, Dunkin Donuts appears to be taking on Starbucks happy hour Frappaccino promotional drive. As summer rolls around the corner, coffee shops around the country have ramped up their promotional efforts, offering consumers luring deals on discounted coffee drinks. With coffee shops plastered on every street corner and down every valley, competing brands such as Dunkin Donuts and Starbucks are coming on strong in a battle to win over the loyalties of consumers across the nation. Dunkin Donuts is partaking in Dunkin Donuts’ Free Iced Coffee Day celebrations in which it gives away free iced coffee to customers between the hours of 4 p. m. to 10 p. . (two hours left to go at the time of writing). Don’t get too excited, though, because if you don’t live in one of 14 locations in which the promotion is offered and aren’t in the mood for iced coffee on May 11, you aren’t getting free coffee. It seems that some may have mistakenly thought that Dunkin Donuts Free Iced Coffee Day is happening nationally, only to have their hopes shattered when they rea lized that iced coffee from Dunkin will be free only in 14 participating locations in Arizona, Maryland, New York, Ohio, Pennsylvania, and Virginia. On the company’s Facebook page, donut dunkers around the country are expressing their anger for not being able to get their yearly dose of free iced coffee. Starbucks, in a calculated move, has been offering discounted frappuccinos at most locations from May 7 through May 16. Between the hours of 3 pm and 5 pm, participating locations will be offering a 50 percent discount on their frappuccinos, or 50% off $4. 75 on a large or venti size. Consumers around the country were thus faced the difficult question as they came off of work: to pay $2. 0 for a tasty frappuccino or pay nothing for a perhaps-less-tasty but always classic cup of iced coffee should you be lucky enough to be in the vicinity of a participating location. Other Competitors: * Caribou Coffee * Donut King in Australia * Honey Dew Donuts in New England * J. CO Donuts ; Coffee mainly in Indonesia * Happy Haus * The Whole Donut in New England * Country Style Company View: Dunkin Donuts today outlined its plans to fu rther expand its presence into Asia starting with the announcement of its first store in Taiwan. The new Dunkin Donuts will open today in Taipei City, Taiwan. The company recently granted franchise rights to Mercuries ; Associates to develop 100 stores in Taiwan over the next 10 years. Mercuries, the fifth largest market cap company in Taiwan, as well as one of the country’s largest retailers, brings 25 years of operating experience to the partnership. Taiwan represents the first step in Dunkin Donuts greater China strategy, said Anthony P. Pavese, Dunkin Brands Vice President of International Asia Pacific. †We are actively looking for Dunkin? Donuts partners in China, added Pavese. Dunkin Brands announcement comes on the heels of the company recently surpassing $1 billion in international system wide sales annually. The Dunkin Donuts restaurant in Taiwan will offer a complete menu of Dunkin Donuts internationally recognized coffee, baked goods and iced beverages. The restaurant will also serve items customized to suit local taste preferences such as sweet potato, green apple and pineapple doughnuts, mocha rings, which are cake doughnuts indigenous to the region, as well as iced fruit teas and sandwiches. The restaurant will be a welcoming environment for customers to connect with friends and family while discovering new food and beverage choices. Our success throughout the Asia Pacific region over the last 25 years gives us confidence that the Taiwanese people will embrace Dunkin Donuts. Locations ; Subsidiaries: With over 2,600 stores in 30 countries outside of the U. S. , Dunkin’ Donuts has been serving loyal customers around the globe for over 27 years. From Asia to Latin America and everywhere in between, you can count on Dunkin’ Donuts for delicious coffee and espresso, cool coolatta, delectable donuts, sandwiches and more. Below is a list of all countries where Dunkin’ Donuts operates: * Aruba * Algeria (2009) * Argentina (2009) * Bahrain * Bahamas * Brazil: (As Dunkin Donuts and as Cafe Donuts, with some different donuts and coffees added to the menu) * Bulgaria * Brunei * Canada * Cayman Islands (2006) * Chile * China (2008) * Colombia * Ecuador * Germany * Honduras * Indonesia * South Korea * Kuwait (2006)| * Lebanon * Malaysia * Mexico * New Zealand * Pakistan (2000) * Panama * Peru (1996) * Philippines (1981) * Russia [31] (1995–1996, 2010-) * Oman (2008) * Qatar * Saudi Arabia * Spain (Due to trademark issues, the brand used is Dunkin Coffee) * Republic of China (Taiwan) * Singapore * Thailand * Turkey * United Arab Emirates * United States *   Puerto Rico | Latest Company News: In the past seven years, Dunkin has added about 1,500 outlets, and that growth is set to accelerate, according to Jon Luther, chief executive of Dunkin Brands since 2003. Late last month, the company fetch ed $2. 43 billion from Thomas H. Lee Partners LP, Bain Capital Partners and the Carlyle Group. The deal, which is expected to close in March, means a hefty infusion of capital, which Luther said would go toward new prototypes and products, and more rapid expansion of the three concepts in Dunkin Brands portfolio. No doubt, the future looks bright for Dunkin Donuts. Dunkin Donuts is continuously striving to launch new products as well as to expand its subsidiaries all over the world. It has recently launched the DDSmart menu constituted of a light sandwich + a light Latte. Dunkin Donuts’ selection of better-for-consumers foods and beverages ensures that its restaurants offer great-tasting choices that fit consumers’ lifestyle and meet their dietary wants and needs.