Dunkin’ Donuts: Presidential Election One Reason People Will Not Buy Donuts

Dunkin Donuts (Mike Mozart / Flickr / CC)
Mike Mozart / Flickr / CC

Dunkin’ Donuts is blaming its decrease in donut sales on the presidential election.

Dunkin’ Donuts reported that revenue fell short of expectations after the retailer reported profits and U.S. sales higher than what analysts expected, Business Insider reports.

The company’s management says one of the reasons for this slowdown in business is the uncertainty of the election.

Barclays analyst Jeff Bernstein asked Dunkin’ Brands CEO Nigel Travis what the reasons might be for a slowdown in the quick-service industry specific to Dunkin’ Donuts.

Travis responded that the slowdown was for several reasons, including “changes in gas prices, changes in food stamp regulations, and, of course, the overwhelming dampening effect of the presidential election.”

“I think we’ll all be pleased when that’s passed,” he said.

Indeed, consumer confidence is at its lowest level since August 2014, according to the University of Michigan’s preliminary consumer confidence survey for October.

“It is likely that the uncertainty surrounding the presidential election had a negative impact, especially among lower income consumers, and without that added uncertainty, the confidence measures may not have weakened,” said Richard Curtin, the survey’s chief economist.

The election’s uncertainty had a more direct impact on franchisees.

Dunkin’ Donuts announced Thursday that the number of new locations that would open this year in the U.S. were set to be on the low end of the 430-460 range.

“What is driving franchisees towards the lower end is several factors, and I’ve described it, put it together as uncertainty, as uncertainty over the general election, Senate, obviously, the House, and local elections,” Travis said.

Travis added that the franchisees with whom he spoke were worried about the uncertainty of the election because of its effects on regulation and whether or not there will be a raise in the minimum wage.

Democratic presidential nominee Hillary Clinton says she will raise the minimum wage to $12, while Republican presidential nominee Donald Trump says he will leave it to the states to decide.


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