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Review of the Dunkin Doughnuts Franchise Opp and Startup Costs

When it comes to franchises that help millions of commuters get their day started off right, none of them might be more influential than Dunkin’ Donuts. They have moved their franchise from a straight maker of donuts to a high-end destination for breakfast sandwiches, coffee, and yes – donuts, but for a fair, competitive price. For that reason, franchising through Dunkin’ Donuts could be the right investment decision to make!

What Markets Are Available For a New Franchise?

If you’re thinking about starting a franchise, you’ve got most of the United States with which you can work. Dunkin’ Donuts is taking new franchise requests from the Atlantic to the Pacific and there’s even opportunities in Hawaii that are open for development. The one place that is completely off-limits at the moment is the Pacific Northwest, were there are no current markets available. The upper East Coast is also reserved for current franchisees. That leaves the Heartland!

In particular, however, Dunkin’ Donuts has highlighted 5 specific markets where they’d love to have you start a franchise:
• California
• Minnesota
• Michigan
• Missouri
• Louisiana

Dunkin’ Donuts has some requirements for the location where your new franchise would be as well. It must be a minimum of a ¼ acre lot, be on the side where the morning commute occurs, and have a drive thru. You must also have a minimum of one parking lot for every three seats installed at the store and there are signage requirements as well. Not having these criteria met isn’t a guarantee that you’ll have you franchise application rejected, but it won’t help either!

What Are the Costs of Starting a Dunkin’ Donuts Franchise?

Are you ready to get investing? The main requirement that Dunkin’ Donuts has in their franchisees is the ability to access adequate capitalization. Because each market is different, there are variable requirements on a franchisee’s minimum liquid assets and net worth. That doesn’t mean there aren’t minimums in play across the board: if you don’t have a $500k net worth with $250k in liquid assets, then you franchise application will not be considered.

Because each market is variable, the franchise fees are variable as well. In most markets, however, you can expect the franchise fee to fall into the range of $40k to $90k. There’s also an ongoing royalty of 5.9% that is paid from gross sales and the term of the franchise agreement is not renewable. That doesn’t mean you can’t continue to be a franchisee after your agreement, but it does mean that you’ll need to re-apply.

Adding in all of the fees, start-up costs, and real estate that you may need in order to achieve a grand opening for your new franchise, the total initial investment on average is about $800k. Some stores have been able to get off the ground for less than $300k, while others have had to invest over $1.5 million to get their franchise going. With over 10,000 franchises around the world in over 30 countries, however, in return you’ll get instant brand recognition and be competitive immediately. In the United States, according to a recent survey, there was a 94% brand awareness of the Dunkin’ Donuts name.

That’s marketing power!

How Good Is the Dunkin’ Donuts Brand?

The Dunkin’ Donuts franchise is consistently one of the best brands where you could invest your money. Not only has it been one of the Top 10 fastest growing franchises in the United States in 4 of the last 5 years, but it has also been a Top 20 investment on the Franchise 500 list for the past 5 years as well. It’s also a Top 15 global franchise brand. With over 70 kinds of donuts, branded coffee, and even the chance to co-brand with Baskin-Robbins, the other major franchise that this parent company owns, there’s a great chance to start making some money fast!

When you are accepted as a Dunkin’ Donuts franchisee, you’ll be prepared to run your new business from the moment you have your grand opening. All new franchisees are given a six-week training course where you will learn about the brand and how to take your restaurant management duties to the next level.

• During the first week of training, you’ll learn about the home company, the brand in which you’ve invested, and what you’ll need to do to continue representing the brand’s expectations.
• In the next two weeks, you’ll learn about the systems that will be in your new franchise and how to properly manage them.
• The final stage of training is dedicated to the manufacturing and production aspects of the Dunkin’ Donuts franchise.

Most importantly, however, are the advisory councils that help facilitate communication between each franchise and corporate headquarters.

Is This Investment Right For You?

The focus of the Dunkin’ Donuts brand is to continually innovate. You’ll see this through the products that have been developed and you’ll also see this in the evolution of technology throughout the brand. Thanks to the Dunkin’ Mobile App, for example, the guests of your franchise are able to send out virtual gift cards, add money to an existing gift card, and be able to find the location of your franchise. They can even see what’s on your local menu!

Even if you have a non-traditional location for your new franchise, there’s the possibility that Dunkin’ Donuts is the right brand to install in your location. You can find this brand in airports, casinos, stadiums, bus stations, large retail stores, and even on the service plazas that you’ll find out on the turnpikes of the East Coast!

With a large portfolio of store designs and different models that all bring about success, the investment into a Dunkin’ Donuts shop has the possibility of being profitable from the first moment you open for business. If you’re willing to risk an investment of the size needed to open up this franchise, then you could find that this is an excellent opportunity to diversify your investments. Apply for a franchise today!

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