Buy A Franchise – Dunkin Donuts

September 21st, 2010

(Buy A Franchise, Seattle Franchise, Bellevue Franchise).

Bill Rosenberg’s Dunkin’ Donuts Rose To No. 1

It was just one flip-open lunch truck parked outside a factory.

But Bill Rosenberg wanted his first business venture in New England to stand out. He wanted to wow customers with the finest coffee.

It was 1946, and the future founder of Dunkin’ Donuts had just cashed in $1,500 in war bonds and borrowed an additional $3,500.

Rosenberg, celebrating the 50th birthday of Dunkin' Donuts in 2000, said: Rosenberg, celebrating the 50th birthday of Dunkin’ Donuts in 2000, said: “If you serve good coffee and fresh product, people will come.”

The going rate for a cup of joe was a nickel. Rosenberg vowed to sell his superior blend for a dime.

Everyone he talked to said it was a bad idea. Rosenberg figured he couldn’t make a decent profit on a penny less. He had added up costs for the higher-priced “hotel blend” he had found and top-quality milk and cream to go with it.

Plus, Rosenberg thought his employees would work harder if they earned more. Their pay was based on 10% commissions.

He knew coffee would make up a big portion of total sales and profit. And he planned to expand…and expand he did…with one of the world’s most successful Franchise models.

Rosenberg’s Keys

  • Founded Dunkin’ Donuts, the world’s largest coffee and baked-goods chain, and helped forge standards for the franchising industry.
  • “I focused on making that first store a success, then I moved on to the second store, the third and the fourth. You start and learn and build and keep changing your goals as you achieve them.”

First he had to get customers to try the coffee. He told his brother Leon to lure customers away from the competition by offering free cups of coffee and telling them they should pay the full price if they liked it.

They liked it.

Besides the better tasting food and coffee, Rosenberg’s brand-new trucks outshone other vendors’ dingy operations. He had the flip-open vehicles outfitted with stainless steel shelving and equipment. His servers wore crisp uniforms.

Before long, Rosenberg’s food trucks eased out the competition. Industrial Luncheon Service grew into a fleet of 200. It became the largest foodservice operation in New England, expanding into cafeterias and mobile food carts inside plants, feeding millions of workers.

But Rosenberg wasn’t satisfied. He wanted to try something new: a retail store. He thought it should showcase the company’s biggest sellers: coffee and doughnuts, both freshly made in batches all day.

In 1948, he opened his first doughnut shop, Open Kettle. It was in a former awning store in Quincy, Mass., on the main road from Boston to Cape Cod.

Looking for a better name, Rosenberg had his employees brainstorm for ideas. In 1950, one name clicked.

Dunkin’ Donuts was born.

New signage added to it: “The World’s Finest Coffee.”

Dunkin’ Donuts went on to become an iconic global fast-food chain, with 9,000 units in 30 countries and $6 billion in annual sales.

The coffee is still percolating — No. 1 in the segment of hot regular cups sold at U.S. quick-service restaurants, though Starbucks is tops in espresso, according to research firm NPD Crest.

(Buy A Franchise, Seattle Franchise, Bellevue Franchise).

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