Dunkin' taking 'maniacal focus' to menu makeover

by Eric Schroeder
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Dunkin' Donuts afternoon sandwich
Dunkin' Donuts is nixing afternoon sandwiches from its menu.

CANTON, MASS. — Afternoon sandwiches, a few muffin and bagel varieties and some bakery items like danishes and cookies have been removed from the menu at Dunkin’ Donuts as the company moves forward with a “maniacal focus” on core strengths, said David L. Hoffman, president of Dunkin’ Donuts U.S. and Canada at Dunkin’ Brands Group, Inc.

During a July 27 conference call with analysts to discuss second-quarter results, Mr. Hoffman described details of a menu simplification plan that has the company looking to extend its leadership in coffee and donuts, while also delivering a compelling national value message.

Dave Hoffman, Dunkin' Donuts
David Hoffman, president of Dunkin’ Donuts U.S. and Canada at Dunkin’ Brands

“A key underpinning of menu innovation is menu simplification, which enables us to take complexities that have crept into the restaurants over the last several years, out of the system,” Mr. Hoffman said. “Menu simplification is all about creating room for growth for the next wave of innovation as a beverage-led, on-the-go brand. As you know, we introduced a simplified menu into 300 restaurants earlier this year and are very pleased with the results. … We will be expanding this streamlined menu through an additional 700 restaurants by October for a total of 1,000 locations. We will roll it out in two phases. The first, by the end of August and the second, by October.”

Mr. Hoffman said classics such as the bacon, egg and cheese croissant will remain on the menu, but other items will be removed.

Dunkin' Donuts bacon, egg and cheese croissant
Classics such as the bacon, egg and cheese croissant will remain on the menu.

 “We will continue to tweak the simplified menu using feedback from customers, franchisees and employees, as we move into the next phase going forward,” he said. “However, we still believe that benefits of simplified menu in the long run will help drive top line and bottom line from improved customer throughput, happier crew and managers and ultimately, increased restaurant level margins. As we’ve said before, simplification will continue to be a cultural mindset for our system. We want to make our restaurants simpler and easier to operate. In addition to this, we are also working on updated P.O.S. systems designed to make life easier at the store level as well.”

Net income at Dunkin’ Brands Group, Inc. in the second quarter ended July 1 totaled $55.7 million, equal to 61c per share on the common stock, up 12% from $49.6 million, or 54c per share, in the same period a year ago. Revenues increased 1% to $218.5 million from $216.3 million.

Nigel Travis, Dunkin' Brands
Nigel Travis, chairman and c.e.o. of Dunkin’ Brands

“We are very excited about the progress that we’ve made on our multiyear plan to transform Dunkin’ Donuts U.S. into a beverage-led on-the-go brand,” said Nigel Travis, chairman and chief executive officer of Dunkin’ Brands Group. “Together with our franchisees, we are laser-focused on delivering what matters most to consumers, including, menu innovation, unparalleled convenience driven by digital leadership, restaurant excellence and simplification and broad accessibility to our products through strategic restaurant development and the sale of our products in other channels.”

Dunkin' Donuts cookies and danishes
Danishes and cookies have been removed from the menu at Dunkin’ Donuts.

Segment profit at Dunkin’ Donuts U.S. in the second quarter ended July 1 was $122,548,000, up nearly 6% from $116,085,000 in the same period a year ago. Total revenues increased 2.2% to $157,080,000 from $153,660,000.

Dunkin’ said its Baskin-Robbins U.S. unit posted segment profit of $10,970,000 in the second quarter, up 2.2% from $10,738,000 in the same period a year ago. Total revenues, meanwhile, increased 4.4% to $14,347,000 from $13,738,000. 
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