Dunkin Donuts International Business Growth Strategy Report

REPORT ON DUNKIN DONUTS INTERNATIONAL BUSINESS GROWTH STRATEGY 1.
Report on Dunkin Donuts International Growth Strategy
Name
Institution

REPORT ON DUNKIN DONUTS INTERNATIONAL BUSINESS GROWTH STRATEGY 2.
Executive Summary
The expansion of business operations to international markets is not an easy task for the
most organization management team. It requires the development of effective strategies and
development of market research aimed at understanding the ease of doing business in those new
markets and determination of successful factors influencing entry into the markets. The study
provides a detailed report analysis of business international growth strategy of Dunkin Donuts
Company as well as help in identifying critical issues that the management of the company
would want to consider by providing the required attention or solution.
Introduction
The rapid growth of the modern corporate world concerning competitiveness has forced
most companies to invest in building their capacity for creating economies of scale. To achieve
these most companies have therefore focused on developing expansion strategies to new
markets. However, there is the need for strategic planning through the suitable use of corporate
resources to facilitate successful market penetration (Cavusgil et al., 2014). Development of an
international expansion growth strategy involves critical analysis and development of market
entry strategies and is a component of essential choices concerning the company primary market
focus, target customer groups, channel distribution strategy, brand positioning, product, and
service value creations as well as resource allocation. Expanding a business globally or seeking
to achieve increased economies of scale requires the development of different international
growth plans (Hitt & Xu, 2016). In most case, some business chooses to develop a new strategy
while other may use the existing global business strategies. Whichever case, according to
strategic management specialists, Michael Porter, there are three strategies which if successfully

REPORT ON DUNKIN DONUTS INTERNATIONAL BUSINESS GROWTH STRATEGY 3.
implemented as a way of developing an international growth strategy contributes to a substantial
competitive advantage for the company. These generic strategies include the differentiation
strategy, cost leadership strategy, and the focus strategy. Therefore this study aims at providing a
detailed report on the business international growth strategy for Dunkins Donuts Company.
Overview of Dunkins Donuts Company and its current Operating Position
Dunkin Donuts is an American multinational or global doughnut company that was
founded in the year 1950 by Willian Rosenberg. Since its establishment, the company has grown
to become one of the leading coffee and baked goods chains or company in the world. The
company has been serving customers internationally for over 40 years and currently operates
more than 12000 restaurants or stores in 36 countries. Despite its concentration in US stores, the
company has one of their largest international markets in South Korea which represents
approximately 4% of the company international sales (Hoffmann, 2014). It operates under the
coffee and snack global market or industry and has been able to achieve an increased growth
success as a result of their store consistency and ability to establish a strong franchise. Its growth
strategy is focused on cost leadership not only on the US snack and coffee industry but also
globally. Currently, the company has been able to develop 23% of market share in the coffee and
snack market with over 7000 stores in the US and estimated sales revenue of $ 658 million. The
company leading competitor is the Starbucks which controls 32.6% of the public market share in
the US and operates over 11000 stores with sale revenue of $ 13.2 billion per year.
Figure 1: Revenue Growth for the Organization

REPORT ON DUNKIN DONUTS INTERNATIONAL BUSINESS GROWTH STRATEGY 4.
Source; Dunkin website, https://www.dunkindonuts.com/
Review of Dunkins Donuts Company international competitive strategy
The company global competitive strategy is becoming a cost leader in the coffee and snack shop
industry or market. To achieve a competitive advantage in the market through cost leadership
strategy, the company aims at producing more. This strategy contributes to a higher asset
turnover as well as ability to spread out the company fixed costs over a large number of values.
The company also seeks to achieve cost leadership by offering a variety of standardized goods or
products helping the company to limit the amount of product or service customization the
company has to make (Samson & Sheela, 2016). As part of the company international
competitive strategy, the company has also focused on buying on bulk, bidding competitively
over contracts as well as working with the company vendors to keep the inventories low (Buzza,
2016). By doing so, the company has been able to control over their international supply chain.
Lastly, the company has been able to build a healthy relationship with its suppliers as an
essential strategy to keep their operational costs.
Figure 2: Competitive Differentiation Strategy