Dunkin Donuts Expands As Starbucks Cuts Its Losses

As Starbucks store closings dominate the news, the little donut shop turned coffee giant continues to quietly open more and more shops. Dunkin Donuts, a long time East Coast coffee and donut favorite, opened nine new stores in the metro Phoenix area at 5 am August 15.

They’re just the beginning, according to three franchise groups who intend to open 150 new Dunkin Donuts in the Valley over the next several years.

Dunkin Donuts Expands As Starbucks Cuts Its Losses
Dunkin Donuts Expands and Starbucks Cuts Its Losses – image copyright Goodiesfirst via Flickr.com

Dunkin Donuts originated in Quincy, Massachusetts in 1964, and quickly grew to almost iconic stature on the East Coast. Unlike Starbucks, which aimed at the upwardly mobile young professional, Dunkins aimed itself squarely at their neighborhood customer – the working class family that loved its donuts and the convenience of grabbing a coffee on the way to work. Among their biggest innovations were the Dunkin Donut – its namesake breakfast pastry with a handy handle for dunking in your coffee – and the Box of Joe, ten cups of freshly brewed Dunkin’s coffee in a handy box that was just perfect for toting to moving parties and work sites.


Also unlike Starbucks, Dunkins has never lost sight of what it is – a place where you can get good coffee and be on your way. Drive through windows are a way of life. Donuts are baked fresh and ready to go. Breakfast sandwiches are prepared on the fly and wrapped to make them easy to eat while you drive. And the focus on what they do best pays off.

Jason Duffy, CEO of one of three franchise groups opening new Dunkin Donuts shops in Arizona, says, “People keep asking, “When are you coming back?” The response has been amazing.”

Some of the locations opened on the 15th of August are new. Others are stores that were closed earlier this year for upgrades that include expanded menus and new espresso machines that can grind beans and create hot or iced lattes in seconds. While the old items will remain on the menu, the new stores will also feature healthier sandwiches and items that are lower in fat and calories.

Despite the changes, the basic message of Dunkins – pictured in a series of humorous television spots featuring original music by They Might Be Giants – remains the same. Dunkins stands for fast, fresh and affordable – a little luxury that you can enjoy in the middle of your busy and hectic life.

In addition to the new stores in the Phoenix area, Dunkin Donuts is also poised to open 10 new stores in the DC area, 200 in Manhattan, a handful in Indiana, a dozen in Pennsylvania – in short, the push is on. The company has announced that they plan to triple the number of US stores by 2020, to about 15,000.

Do they run the risk of oversaturating the market a la Starbucks? Analysts think not. Dunkins has no pretnsions of becoming your home away from home. They just want to be the store on your way to work and everywhere else you have to go.