After announcing an initial introduction of its shops in central and southern Kentucky, Dunkin’ Donuts is letting it be known that additional market saturation is coming to the Lexington area.
“There is actually a little bit of room for another franchisee to come into the market,” said Lynette McKee, vice president of franchising and new business development at Dunkin’ Donuts corporate headquarters in Canton, Mass. A generous baker’s dozen of Dunkin’ Donuts shops already are planned to appear over the next three years, with the first slated to open in May at the Main & Rose building at 333 East Main Street in downtown Lexington.
The new restaurants, featuring expanded menus and appearing in a variety of designs and venues, will be operated by Fast Break Doughnuts, LLC of Lexington, led by Lexington businessman Rick Avare, University of Louisville Coach Rick Pitino and former University of Kentucky basketball players Walter McCarty and Jamal Mashburn.
“Seventeen in the central Kentucky area, and once we get these under our belts, we’re looking to continue to expand with Dunkin’ Donuts,” said Mashburn, who retired after 11 years of pro basketball to pursue a lifelong passion for business. “We saw their growth potential, and it was attractive in that way.”
The brand’s appearance in Kentucky is part of a major expansion plan involving both geography and menu. The company is undergoing the most significant expansion program in its history, with plans to ultimately triple its number of U.S. stores to 15,000 by 2025.
“The markets that we have the development rights for are Fayette County, Scott County, Jessamine County, Franklin County and basically all the counties along I-75 south, and we also reach over into Pulaski County,” said Fast Break’s chief financial officer, Tom Wylie.
The shops soon to appear in the area are not your daddy’s Dunkin’ Donuts. “People will be surprised if they remember, way back when, what a Dunkin’ Donuts was, which was really just a donut shop,” said Wylie. “It’s really more of a restaurant concept now that can compete in any day-part as we go through the day, and from a beverage perspective, a very wide menu.”
Wylie explained that the brand has changed dramatically since it was purchased in 2006 from Pernod Ricard SA for $2.4 billion in cash by a consortium of global private equity firms, led primarily by Bain Capital Partners LLC but including The Carlyle Group and Thomas H. Lee Partners LP.
“Once Bain Capital purchased it, they infused a substantial amount of capital in it and went back out to grow the brand dramatically,” he said. “To do that, they knew they had to change the look of Dunkin’. It’s a much cleaner look. The menu is widely enhanced from what it was in the past; we obviously serve the donuts, but now we have breakfast sandwiches, hash browns, a beverage mix that includes coolatas, smoothies, lattes, coffees. And we recently announced the rollout of flatbread sandwiches for lunch along with personal pizzas.”
The aim is to spread sales more evenly throughout the 5 a.m. to 11 p.m. day maintained by most of Dunkin’ Donuts’ North American shops.
Mashburn, Pitino and Avare have already chocked up experience in the food service industry, teaming up to own 35 Outback Steakhouses in California. They are joined by McCarty, who played under Pitino with the Boston Celtics and is now an assistant coach at U of L. Mashburn and Avare also own and operate 28 Papa John's Pizza locations in six states.
In discussing the new Dunkin’ Donuts venture in a telephone interview from his home in Miami, Mashburn, a native New Yorker, revealed what was really going through his mind during those years with the NBA: “Everybody thinks a basketball career was my dream, but I’m living my dream right now.”
Mashburn recalled catching the bug for business as early as age ten. “I went to Catholic school in downtown Manhattan, so I had to get on a train and go from Harlem to downtown Manhattan, and I would see men and women with business suits on and carrying briefcases, and I always would wonder what’s in that briefcase. I found out early in life, probably at about 14 or 15 years old when I had my first summer job, that I had to have some creative control and I wanted to have freedom and I wanted to continue to grow. That summer job provided a way for me to understand that there are different sides to doing business: you can either work for somebody, people can work for you or you can work with people. I chose to work with people, and also to kind of control the situation a little bit and be creative. So, early on it was, for me, all about getting to this level where I am now.”
In addition to his restaurant partnerships, Mashburn also joined Pitino and Avare in purchasing 70 percent of Toyota on Nicholasville and the Lexus Store of Lexington on U.S. 27 in Nicholasville.
Information on Dunkin’ Donuts franchise opportunities can be found online at dunkinfranchising.com, or by calling (877) - 9DUNKIN (938-6546).