1. Dunkin’ Donuts wants to get a better market position in Europe, and set up a meeting in London with potential franchisees from different European countries in order to negotiate franchising deals that could provide a higher growth in this region. What potential dangers should the US negotiator be aware of in this kind of cross-national negotiation?

2. What is Dunkin’ Donuts’ value perception and positioning strategy?

3. How has Dunkin’ Donuts responded to competitive changes in the global marketplace?

Dunkin’ Brands – www.dunkinbrands.com runs – a chain of quick service restaurant companies. The company is split into three business segments: Dunkin’ Donuts, Baskin- Robbins and Togo’s. Retail outlets are operated in a franchise format either through operating agreement, license agreement or joint venture.

Dunkin’ Donuts (www.DunkinDonuts.com) claims to be the world’s largest coffee and baked goods chain, serving 2.7 million customers per day at approximately 8800 stores in 31 countries which includes approximately 6,400 Dunkin’ Donuts locations throughout the United States. 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. Dunkin’ Donuts’ most significant presence overseas is in the Philippines, Indonesia, South Korea and Thailand. Dunkin’ Donuts’ international locations are mainly concentrated in Asia-Pacific and Latin America.
Founded in 1950 in Quincy, Massachusetts, by William Rosenberg, Dunkin’ Donuts became famous for their varieties of donuts and the wide range of bakery products – muffins, bagels and donut hole treats. Dunkin’ Donuts is also the place for beverages – from freshly brewed hot coffee in up to nine flavors, to refreshing iced coffee and chocolate beverages. Dunkin’ Donuts has seen a revival since 2003 as a result of new product innovation, as well as the addition of breakfast sandwiches. While the company is included in the bakery segment, which is more mature, it also competes with the stronger growing coffee specialist segment. As a result, Dunkin’ Donuts has expanded the variety of its menu, including the launch of a new smoothie yoghurt drink, backed by heavy advertising. Dunkin’ Donuts has large expansion plans, expecting to grow by 15,000 outlets by 2015 in an attempt to be more competitive with coffee specialist chain Starbucks by having more conveniently and ubiquitously located outlets. In 2006, Dunkin’ Brands, Inc. was purchased by a group of investors: Bain Capital LLC, the Carlyle Group and Thomas H. Lee Partners, L.P. from Pernod Ricard, South Africa, following Pernod’s acquisition of Allied Domecq PLC, Dunkin’ Brands’ former parent company.

Dunkin’ Donuts has many strengths: quality and freshness, flavour and variety, good value, convenient locations and strong brand presence. However, the company has to deal with powerful, new competitors, including Starbucks and Krispy Kreme.
Dunkin’ Donuts continues to be a major brand with $5.5 billion in sales (2008). Success is attributed to extensive market research conducted before a product is launched. Additionally, corporate training enforces the company standards to deliver a consistent product year after year and across all restaurants and franchises. Dunkin’ Donuts does not target one customer segment; rather, it reaches across all demographic strata. Its promotional campaigns and diversity of locations support this strategy. To meet market demand, the company is expanding into the coffee market by offering specialty coffee drinks in addition to its standard drip coffee. But Dunkin’ Donuts will not deviate from its original product offering and continues to offer the consumer quality, convenience and variety.