While Dunkin' Donuts has at times struggled to expand consistently outside the East Coast, it's difficult to ignore the company's consistent growth. Motley Fool reports that the franchise enjoyed a net growth of 371 stores in 2013, largely thanks to expansions in Texas, Colorado and Utah. The franchise expects to add another 400 stores in 2014. Dunkin' Donuts has done all the right things to stay relevant as a franchise over six decades, including modernizing its marketing through successful social media campaigns. The 64-year-old Dunkin' Donuts brand is a great example of how franchises can remain successful in the long term through adaptation.
Dunkin' Donuts attempted to take a slice of the coffee market in the Starbucks-loving state of California in the early 2000s. Unfortunately, the store's lenient franchisee requirements led to a long list of problems, and soon the state's dozen pilot stores were closed. Dunkin' Donuts is back in the Golden State in 2014 with an aggressive expansion strategy and a host of new, more closely vetted franchise partners, according to The Boston Globe. The donut shop has already signed agreements to build 200 additional stores in the state by 2020, and the company hopes to eventually open 1,000 total stores across California.
In addition to reforming its approach to franchisee recruitment, Dunkin' Donuts has adapted to business on the West Coast by applying lessons learned about California consumers. A greater level of health consciousness and sense of sustainability is common among California patrons, a niche that helped Starbucks has worked hard to tap into directly. Dunkin' Donuts has acknowledged the environmentally-focused California coffee drinker by rolling out polypropylene cups for hot coffee. Bloomberg Businessweek explains that the new plastic cups will replace foam cups that are now maligned as unsustainable.
Bigger in Texas
Dunkin' Donuts also has put an emphasis on expanding its reach in Texas communities, says MarketWatch. San Antonio and Austin are key target cities, specifically in neighborhoods like College Station, Beaumont, Killeen and Liberty. The company recently hosted a webinar to encourage and educate potential investors about opportunities with Dunkin' Donuts franchising. The donut shop has ambitious franchise goals, working toward 15,000 stores across the country, and hopes to open a good fraction of those units in Texas.
To this end, the brand has made moves to sweeten the pot for Texan investors. The company has offered lower royalty fees and up to $10,000 in marketing funds to stores that hit certain performance markers. These and other incentives are aimed at attracting motivated local investors to serve as the vanguards for Dunkin' Donuts' national takeover. Texas franchisees are also being lured in with the promise of customization. Dunkin' Donuts offers various restaurant layout designs for franchisees to choose from. This system allows investors a certain degree of personal ownership in terms of how the store looks and operates. Franchise owners are able to customize their stores as they wish to attract new customers and create a satisfying workplace.