Dunkin Donuts Supply Chain Analysis Essay
Resource Allocation/restructuring needs Dunkin' Donuts has focused on becoming a cost leader in the U.S. coffee and snack shop industry which is defined as "offering the same or better quality product or service at a price that is less than what any of the competition is able to do." There are three main ways that Dunkin' Donuts is able to charge lower prices for their products compared to their competitors. The first is that they produce more which results in a higher asset turnover. Also by producing more, they are able to spread out their fixed costs over a larger number of units. In addition, Dunkin' Donuts offers a variety of of standardized products which limits the amount of product and service customization they have to do. Finally, by buying in bulk, bidding competitively over contracts, and working with vendors to keep inventories low, Dunkin' Donuts is able to keep a tight control over their supply chain. Having strong relationships with suppliers is a vital way to keep costs low. …show more content…
The map below depicts the abundant amount of stores in the East compared to the rest of the country. By 2020, however, they plan to have a total of 15,000 stores in the United States which would almost double their current U.S. presence. In addition to the United States, Dunkin' Donuts has been serving customers internationally for over 40 years and currently operates over 3,100 stores in 32 countries. Their growth is successful due to their store consistency and strong franchises; out of their approximately 10,000 stores worldwide, about 7,000 of them are franchises. Therefore, consistency between these stores is of great
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