While Starbucks (SBUX) reports quarter after quarter of decline or stagnant traffic and disappointing results, McDonalds (MCD) keeps turning in great results and traffic increases. Now word is that results at Dunkin Donuts are so strong, they plan to double the number of locations, adding over 9,000 in the next decade.
Reuters reported:
“They have a lot of appeal to the anti-Starbucks crowd. It’s not as chichi and it has a little more blue-collar appeal, which works to their advantage,” said restaurant consultant Bob Goldin of Chicago’s Technomic. Dunkin’ has been a Technomic client, but Goldin has not done work for the company.
Goldin said Dunkin’ made the right choice in expanding beyond breakfast, spiffing up units and pushing national advertising. Its biggest risk is making its menu too broad, he said.
Despite its name, 58-year-old Dunkin’ is more about drinks than doughnuts.
The chain gets around 65 percent of sales from beverages. Over the last few years, it has added espressos, lattes and cappuccinos that cost roughly $1 less than at Starbucks.
Now Starbucks and its leader Howard Schultz can claim all day that they are not losing people to “the competition” but, until the blatantly obvious facts stop saying otherwise, that and almost everything else that is said in Seattle will be looked at very skeptically.
Disclosure (“none” means no position):Long MCD, None
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