Dunkin’ Donuts to Open 1,000 Stores in California

After an 18 year “vacation,” Dunkin’ Donuts is returning to California with a vengeance. The Canton, Massachusetts-based company has already opened ten stores in the state, has just announced nine in the Bay Area, and expects to eventually have 1,000 stores in California.

Known for all the old favorites, “Dunkies” in the rest of the U.S. now enjoys killer treats like Snickerdoodle Lattes and fake Cronuts. But Dunkin Donuts was chased out of the state and closed its last 15 California stores in the late 1990s. Dunkin’ Brands Group Inc. PR’s explanation of why they left: “The company operated so few stores that the brand was not able to develop and prosper in the state.”

But the real giant-killer was the large number of Cambodian donut shops that “saturated” the state. According to commenter Bulavinka on Chowhound, “the donut market was flooded by these mostly immigrant/family-run operations, thereby crowding out just about any competitors whose operating margins were higher than these mom & pop businesses.”

Bain Capital, Mitt Romney’s former company, led a wildly successful 2005 leveraged buyout of Dunkin’ Donus with the Carlyle Group and Thomas H. Lee Partners. Dunkin’ Donuts is now the world’s leading baked goods and coffee chain. It sells 52 varieties of donuts and more than a dozen coffee beverages, and an array of bagels, breakfast sandwiches and baked goods. The company’s 11,300 stores in 41 states are expected to serve more than 3 million customers today.

According to a press release on Monday, Dunkin’ Brands Group Inc. entered into a new franchising agreement with Shiva Developments to build nine locations in San Francisco. It also agreed with existing franchisee Aharon Aminpour to develop 17 restaurants in Fresno and the surrounding cities, including Clovis, Visalia and Tulare. Aminpour currently owns and operates one Dunkin’ Donuts restaurant in Encino, and last November signed a development agreement for 10 new restaurants throughout the San Fernando Valley.

“With the addition of these enthusiastic and dedicated franchisees, we’re proud to announce 26 new restaurants in the Golden state, which brings our current development commitments to more than 275 total restaurants in California,” said Grant Benson, CFE, vice president of global franchising and business development, Dunkin’ Brands. “We are thrilled these existing franchisees have chosen to expand their presence in the California market, and know these new restaurants will satisfy a growing consumer demand for Dunkin’ Donuts in the Fresno and San Francisco communities they will serve.” The company expects the new stores to open by 2017.

The doughnut chain opened its first California location in Santa Monica last September area and was flooded with “Munchkin” lovers that were willing to stand in long lines. With just 10 stores opened so far, Dunkin has announced that it intends to have more than 1,000 restaurants in California “over the long-term,” according to Eater consultants.

Dunkin has real estate formats available for free-standing restaurants, end caps, in-line sites, gas and convenience, travel plazas and universities. Unlike other quick-service restaurants, Dunkin’ Donuts allows franchisees to select individual elements from any of the four options, creating a restaurant design that reflects their personal tastes and preferences, and that best serves their specific restaurant size and location.

Although the standard 1950s doughnut fare is always available, the stores now offer the iced coffee, flavored coffees, lattes, Dunkin’ Donuts K-Cup® pods, Coolatta® frozen drinks, and DDSMART® menu featuring treats referred to as, “better-for-you items.”