Dunkin’s worker hands coffee out of a window with a gloved car and mask as Coronavirus continues to spread on March 17, 2020 in Norwell, Massachusetts.
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When the pandemic hit the US, large and small restaurants with formwork across the country, Dunkin ‘Brands leaned towards its on-the-go model and made quick decisions to suit evolving consumer preferences. CEO Dave Hoffmann says that quick thinking and cutting through bureaucracy that can stop changes in large companies has led to an expansion of supply currently at 1,400 locations and delivery in more than 5,000 stores.
Today, 96% of Dunkin ‘and Baskin-Robbins are open nationwide, with customers increasingly turning to contactless and mobile options.
The coffee company continues to update its locations and may close approximately 800 of its underperforming stores. However, transport problems remain across the industry, with Covid-19 cases continuing to rise nationwide, disrupting routines and keeping consumers in check.
“We think there are two main forces we will work against: health and safety … and access to the brand,” Hoffmann said in an interview on Thursday. “Based on the best information you have, making quick decisions is what our team really learned during the crisis.”
Gone, or at least suspended, are the breakfast wars that have long captured the restaurant and fast food industry, because morning attendance is interrupted in the foreseeable future because so many Americans work from home during a pandemic.
Hoffmann said Dunkin’s breakfast and tithe are well available to consumers throughout the day. And its innovation in beverages, from espresso options to Matcha and Refreshers options, which bring a younger demographic of women, is well positioned to compete.
“We think the industry is currently in combat mode and we are preparing for this fight,” said Hoffmann. “We are far from waving victory flags with a big time, but we are glad that our offer will be in autumn and winter.”
The company just reported the highest and lower profits in the second quarter, while sales in the same business in the US fell by 18.7%. Sales in the US were to some extent supported by higher average tickets – a trend in the entire industry. At the height of the pandemic in April, sales in the same store fell by 32%, then by 17% in May, by 9% in June, and now until July 25, this key metric is reduced by a low single-digit rate.
Despite this progress, Dunkin’s shares traded lower on Thursday, most recently by almost 4%. Inventories, which have a market value of $ 5.7 billion, have fallen by more than 9% since the beginning of the year.
The findings of early coronavirus outbreaks in its two main markets, Boston and New York, prepared the company for the second wave, as 90% of transactions were some form of Covid leak in advance.
“During the quarter, we learned a lot about how to work in a pandemic,” said Scott Murphy, president of Dunkin ‘Brands Americas. “Whether it’s powertrains, curbs, vans or face masks, we’ve done a lot of research and it has been shown that people feel safe coming to Dunkin.”
The company is also financially stable, Hoffmann added, as Dunkin ‘renewed its dividend this quarter.
He added that digital broadcasting will be a big focus forward, adding 4.2 million active users on its digital platforms over the past 90 days. Dunkin ‘recently added Philip Auerbach as Chief Digital and Strategic Officer to continue expanding this part of the business with the Digital Technology, IT and Data Science team under Auerbach.
“Our entire digital asset group today accounts for 21% of transactions,” said Hoffmann. “Mobile ordering and pickup accounts for 7% of traffic … All we’ve done is open this access to customers so they have the most secure access to our brand.”