South Africa’s First Dunkin’ Donuts to Open in Cape Town
According to an Article in the Business Day written, South Africa’s first Dunkin’ Donuts is set to launch in Cape Town this year in June
Krispy Kreme’s local store might be a good indication that Dunkin’ Donuts will also appeal to South African’s
Customers keep on rewarding themselves with small treats even though current economic conditions are getting tougher.
Global brands continue to expand into SA as we can see from the following new entrants;
- Starbucks is due to open in March,
- Pizza Hut launched recently
- and Domino’s Pizza is also expanding.
Grand Parade Investments (GPI) have signed a franchise agreement with Nasdaq-listed Dunkin’ Brands to bring the coffee and doughnut chain, as well as ice cream offering Baskin-Robbins to SA.
The products will be imported, with “finishing” done in stores while the group builds critical mass. GPI CEO Alan Keet stated that their plan is to localise the product as soon as they can.
Grand Parade Investments (GPI) also holds the country’s Burger King licence and has localised 95% of their inputs. In an interview with CNBC Africa, GPI also stated that Burger King has already localised 90% of the products and plans to start franchising the end of the year.
According to Alan Keet, GPI was eyeing mostly high revenue-generating forecourt stores for its roll-out to reach a target of ;
- 250 Dunkin’ Donuts and
- 70 Baskin-Robbins stores.
Retailers are starting to use these types of platforms to grow their brand awareness due to consumers becoming accustomed to getting their coffee and snack fix from filling stations; a convenient location.
A new coffee culture;
- Shell and local coffee brand Vida e Caffé recently announced the opening of their 100th forecourt store in South Africa
- Mr Keet said: “The coffee market is growing and it has a very aspirational element. You see people in New York walking with their coffee cups — it’s very trendy and it’s on TV too. Our population are in a rush because of time pressure and commuting, so they are really in a grab-and-go mode.”
Dunkin’ Brands other consumer offering Baskin-Robbins has a presence in; more than 50 countries outside the US including India, China and Russia.
The specialty ice-cream shops also sells;
- custom ice cream cakes,
- frozen beverages
- and ice cream sundaes.
Dirk van Vlaanderen, investment analyst at Kagiso Asset Management, said “They will have a much clearer outlook on the speed and location of Dunkin’ Donuts store roll-out. The much smaller size of the Dunkin’ Donuts stores suggests that set-up costs per store should be significantly lower than Burger King stores — several of which are large, drive-throughs,” He also states that GPI had gained a lot of valuable experience from the Burger King expansion.
“This, combined with the fact we also expect the Dunkin’ Donuts brand to have a significant portion of franchised stores, suggests an overall more prudent and capital-light approach is likely to be employed to the Dunkin’ Donuts roll-out.”
GPI will roll out company owned stores before franchising, similar to their strategy with Burger King.
Source The BusinessDay Live: http://www.bdlive.co.za/business/retail/2016/01/28/cape-town-to-get-first-dunkin-donuts-outlet