Dunkin' Brands Group, Inc.
) intends to debut Dunkin' Donuts traditional restaurants in
California before the end of 2014. The restaurants will be located
in Downey, Long Beach, Modesto, Santa Monica and Whittier and
construction will start this month.
While the restaurants in Downey and Whittier will be operated by
franchisees Danny and Coby Sonenshine, the Long Beach restaurant
will be operated by Frontier Restaurant Group. The Santa
Monica-based restaurant will be operated by an existing Dunkin'
Donuts and Baskin-Robbins franchisee which already operates seven
restaurants in New Jersey. The Modesto restaurant will be operated
by Sizzling Donuts, LLC, which already operates Dunkin' Donuts
restaurants in Colorado, Texas and Utah.
Dunkin' Donuts has completed almost 200 restaurant development
agreements with franchises, since 2013 in California. The company
intends to have almost 1,000 restaurants throughout the state on a
long-term basis. The company has already opened three
non-traditional Dunkin' Donuts restaurants in the state, with the
latest Dunkin' Donuts/Baskin-Robbins combination restaurant
unveiled inside the Embassy Suites San Diego Bay Downtown Hotel.
The company also signed multi-unit store development agreements
with four new franchise groups to develop 54 restaurants throughout
Southern California in the coming years. These franchisees are
Burton Restaurants LLC, Good Treats LLC, The Tasty Group LLC and a
new franchise group led by Mike Stout and Neal Wichard.
Burton Restaurants, Good Treats and Tasty Group will open their
respective first restaurants in 2016. While Burton intends to open
around 14 restaurants in San Diego over the coming years, Tasty
Group intends to develop a couple of restaurants in Santa Barbara
and eight restaurants throughout Ventura County over the upcoming
years. Good Treats plans to build 14 restaurants throughout
Glendale, Burbank and Santa Clarita Valley in the upcoming years.
Finally, the Mike Stout and Neal Wichard led franchise group
intends to unveil 16 restaurants in Northern San Diego and Southern
Inland Empire with the first scheduled for a 2015 opening.
Dunkin's decision to revisit California in 2013 comes after the
chain left the state in 2002 due to dwindling sales. With plans to
open around 330 to 360 stores in the United States this year, the
brand is looking to significantly expand its presence to high
demand markets in California. Additionally, the brand seeks to
capitalize on the booming breakfast trend within the fast food
industry. We believe Dunkin's affordable pricing will put it in a
better position than
) - which has an extensive presence in California - and
Dunkin' currently has a Zacks Rank #3 (Hold). A better-ranked stock
in the same sector is
Buffalo Wild Wings Inc.
), sporting a Zacks Rank #1 (Strong Buy).
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