Slam Dunk for Dunkin'?

New Philadelphia concept store reveals chain's appetite for food dollars

PHILADELPHIA -- A new Dunkin' Donuts store conceptbearing the words caf a and bake place on its fa aadeplaces an emphasis squarely on prepared foods such as flatbread sandwiches and breakfast pizzas, in addition to the made-to-order coffee and doughnuts that have made it a prime competitor for convenience stores in more than 30 U.S. states.

Dunkin' Donuts, a subsidiary of Dunkin' Brands Inc., Canton, Mass., revealed its new focus last week at the grand reopening of a franchisee-run location along an urban strip in South Philadelphia. The refurbished [image-nocss] store shares lot space with an auto-tag dealer along a busy stretch of Broad Street, a central artery that connects the area surrounding the hardnosed city's Sports Complex to its more polished theater, shopping and business districts.

A Sunoco A-Plus sits right next door to the newly renovated and reopened Dunkin' Donuts, while two Starbucks coffeehouses are within walking distance. During a late-morning weekend visit to the site by CSP Daily News, the store benefited from heavy cabbie and walk-in traffic, perhaps drawn by Dunkin' Donuts-themed wind flags flapping in a slight breeze and a mammoth, inflatable cup of coffee that danced on the building's roof.

The new concept store remodeling effort is an exciting program for us at Dunkin' as it stems from a commitment that Dunkin' Donuts made when we launched the America Runs on Dunkin' ' campaign earlier this year, Joe Scafido, chief creative and innovation officer for Dunkin' Brands, said in a release. We pledged to provide better service through better store layouts and technology so our loyal customers could get quality Dunkin' products and be on their way to keep American running. Because innovation drives everything we do at Dunkin', this new store design will help us better deliver on our promise to provide our customers with the best quality products quickly and for the best value.

The new menu and branding additions are apparent even before the customer enters the store, as the concept uses parts of the building as branding tools; a neon-pink D serves as the store's door handle. The site also features a new logo that contemporizes the current Dunkin' Donuts logo but maintains the core DNA of the brand, the company said.

Inside, customers see two open-air merchandisers peddling juices, milk, soft drinks and water. Throughout the queue, customers find it tough to ignore the stacked display of Box o' Joe bulk coffee carafes and private-label bags of beans.

A new warm bakery display and a baker/merchandiser at the front counter is a new addition, offering samples of freshly baked products throughout the day. Along the back wall rests the standard display of fresh-made doughnuts, bagels, croissants and pastries. The site has a small if not cramped sit-down area, consisting of a counter rail and a few stools.

The emphasis on foodservice, however, is apparent. An in-store signage package promotes the new menu additions, including three varieties of flatbread sandwiches. The sandwiches, which are made with wedges of toasted lavas bread, contain one of three fillings: three cheese; ham and cheese; and turkey, bacon and cheese. The new Personal Breakfast Pizzas come with toppings of egg and cheese or sausage, egg and cheese.

With aggressive expansion into such new territory, Dunkin' Donutsalong with Starbucks, Panera Bread and other QSR chainsappears to have set its sights on customers who spend their dollars in c-stores. The chain's increased emphasis on food other than baked goods will most likely amplify the challenges of the convenience channel, which is also trying to reinvent itself with the help of foodservice.

Prepared foods have become an increasingly important part of Dunkin' Donuts' business. Earlier this year, Dunkin' Donuts introduced a new addition to its highly popular line of breakfast sandwichesthe Maple Cheddar Sandwichfor all-day consumption. Demand for breakfast throughout the day has become so high that, in 2006, Dunkin' Donuts saw an increase in sales of more than 10% for breakfast sandwiches.

Furthermore, according to the company's website, the company has a number of Dunkin' Deli shops within Dunkin' Donuts locations in Illinois, Indiana, Michigan, New Jersey, New York, Virginia and Wisconsin. The delis offer a variety of gourmet sandwiches, salads and soups.

Dunkin' Donuts is the No. 1 retailer of hot regular coffee-by-the-cup in America, selling 2.7 million cups a day, nearly 1 billion cups a year, the website said. Dunkin' Donuts has more than 7,200 restaurants in 30 countries worldwide. In the United States, there are approximately 5,300 Dunkin' Donuts locations in 34 states.

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