Harvard Business School 9-589-017

!"#$%&"'"()"*%+,-%.///

Dunkin’ Donuts (E): 1988 Distribution Strategies

E6"% <45><% ?>=% )G771><% 2*1(4>">7A3% =4<2A?3"=% 76*1G561G7% 76"% &G>U4>V% &1>G7<% '1*21*?7"
6"?=FG?*7"*<% *"?=-% WE4("% 71% O?U"% 76"% ;*1C47<-X% ?% *"C"*">'"% 71% 76"% A1>5H*G>>4>5% ?=#"*74<4>5% <A15?>-
WE4("% 71% O?U"% 76"% &1>G7<$X% % Y7% ?A<1% "Z2*"<<"=% ?% <"><"% 1C% G*5">'3% B476% *"<2"'7% 71% C*?>'64<""% 2*1C47
A"#"A<$%%&G>U4>V%&1>G7<%B?<%?%241>""*% 4>% )G<4>"<<% C1*(?7% C*?>'64<4>5+% ?>=% 76"% (?>?5"(">7% 2A?'"=
5*"?7% #?AG"% 1>% 76"% A1>5H<7?>=4>5% 6?*(1>41G<% *"A?741><642% B476% 47<% C*?>'64<""<$% % E6"% '1(2?>3% 6?=
?'64"#"=% I/% '1><"'G74#"% FG?*7"*<% 1C% <?A"<% ?>=% "?*>4>5<% 5*1B76-% ?>=% (?>3% C*?>'64<""<% 6?=% )"'1("
B"?A763%)3%"Z2?>=4>5%76"4*%12"*?741><%?<%76"%'1(2?>3%5*"B$%%M3%"?*A3%+9::-%61B"#"*-%="7"*41*?74>5
<?A"<%71%'?247?A%*?741<-%<74CC">4>5%'1(2"74741>-%?>=%G>"#">%"Z2?><41>%76*"?7">"=%>17%1>A3%76"%A"#"A%1C
'1(2?>3%2*1C47?)4A473%)G7%?A<1%47<%*"A?741><642%B476%76"%C*?>'64<""<$%%P%>G()"*%1C%12741><%76?7%*"A?7"=
2*4(?*4A3% 71% 4>'*"?<"=% =4<7*4)G741>% B"*"% )"4>5% "Z2A1*"=$% % P>3% '6?>5"% 4>% <7*?7"53% B1GA=% *"FG4*"
'?*"CGA%"Z?(4>?741>%1C%47<%"CC"'7%1>%)176%76"%C*?>'64<""<%?>=%76"%'1(2?>3$

Dunkin’ Donuts

[4AA4?(%!1<">)"*5%12">"=%64<%C4*<7%'1CC""H?>=H=1G56>G7%<612%4>%\G4>'3-%O?<<?'6G<"77<-%4>
+9I/$% % Y>% +9II% 6"% )"5?>% A4'"><4>5% 76"% *4567% 71% 4(47?7"% 64<% *"7?4A% 12"*?741>% 71% 4>="2">=">7
1B>"*R12"*?71*<-%'?AA"=%C*?>'64<""<$%%MG<4>"<<%C1*(?7%C*?>'64<4>5-%?<%764<%732"%1C%'A1>4>5%*"A?741><642
'?("%71%)"%U>1B>-%B?<%4>%47<%4>C?>'3%4>%76"%"?*A3%+9I/<$%%M3%76"%A?7"%+9:/<-%61B"#"*-%)G<4>"<<%C1*(?7
C*?>'64<4>5%6?=%)"'1("%?%(?]1*%C1*'"%4>%*"7?4A4>5%4>%76"%^>47"=%N7?7"<$%%O"?>B64A"-%&G>U4>V%&1>G7<
6?=% "Z2"*4">'"=% <4(4A?*% 5*1B76$% % P<% 1C% 76"% ">=% 1C% +9:K% 76"*"% B"*"% +-JK:% &G>U4>V% &1>G7<% G>47<% 4>
12"*?741>%4>%47<%S1*76%P("*4'?>%*"541>%_4$"$-%^>47"=%N7?7"<-%0?>?=?-%?>=%;G"*71%!4'1`-%1C%B64'6%+-JJ9
B"*"%C*?>'64<"=$%%&G>U4>V%&1>G7<%A4'"><"=%?>%?==4741>?A%+9+%G>47<%76*1G561G7%76"%*"<7%1C%76"%B1*A=$

%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%
1. MG<4>"<<% C1*(?7% C*?>'64<4>5% 4<% =4<74>5G4<6"=% C*1(% 2*1=G'7% C*?>'64<4>5% 4>% 76?7% 76"% 2*1=G'7% C*?>'64<1*% 4<
7324'?AA3% ?% (?>GC?'7G*"*% <""U4>5% '1>7*?'7G?A% 1G7A"7<% C1*% 47<% )*?>="=% 511=<$% % E6"% 2*1=G'7% C*?>'64<1*% (?3% 1CC"*
<1("%?=#"*74<4>5%?>=%(?>?5"*4?A%?<<4<7?>'"-%)G7%76"%C*?>'64<""%5">"*?AA3%'1>=G'7<%)G<4>"<<%?<%?>%4>="2">=">7
=4<7*4)G71*$%%E6"%)G<4>"<<%C1*(?7%C*?>'64<1*%4<%7324'?AA3%?>%12"*?74>5%*"7?4A"*%B61%A4'"><"<%76"%*4567%71%*"2*1=G'"
76"%C*?>'64<1*V<%)G<4>"<<%C1*(GA?%?>=%<3<7"(<%4>%?>176"*%A1'?741>$%%Y>%*"7G*>%C1*%?%1>"H74("%C*?>'64<"%C""%?>=%?>
1>514>5% *13?A73% )?<"=% 1>% ?% 2"*'">7?5"% 1C% 5*1<<% <?A"<-% 76"% C*?>'64<""% >17% 1>A3% *"'"4#"<% 76"% *4567% 71% G<"% 76"
)G<4>"<<% C1*(?7% C*?>'64<1*V<% 7*?="(?*U% )G7% ?A<1% 12"*?7"<% G>="*% <2"'4C4'% 5G4="A4>"<% '1#"*4>5% ?AA% ?<2"'7<% 1C% 76"
)G<4>"<<-%4>'AG=4>5%(?*U"74>5-%12"*?741><-%C4>?>'"-%?''1G>74>5-%?>=%="<45>%1C%76"%2*"(4<"<$

Professor Patrick J. Kaufmann prepared this case as the basis for class discussion rather than to illustrate either effective or
ineffective handling of an administrative situation. Company data have been disguised and should be used for purposes of
class discussion only.
0123*4567%8%+9::%)3%76"%;*"<4=">7%?>=%@"AA1B<%1C%D?*#?*=%01AA"5"$%%E1%1*="*%'124"<% 1*%*"FG"<7% 2"*(4<<41>% 71
*"2*1=G'"%(?7"*4?A<-%'?AA%+H://HIJIHKL:I-%B*47"%D?*#?*=%MG<4>"<<%N'611A%;G)A4<64>5-%M1<71>-%OP%/.+L,-%1*%51%71
6772QRRBBB$6)<2$6?*#?*=$"=G$% % S1% 2?*7% 1C% 764<% 2G)A4'?741>% (?3% )"% *"2*1=G'"=-% <71*"=% 4>% ?% *"7*4"#?A% <3<7"(-
G<"=% 4>% ?% <2*"?=<6""7-% 1*% 7*?><(477"=% 4>% ?>3% C1*(% 1*% )3% ?>3% ("?><T"A"'7*1>4'-% ("'6?>4'?A-% 26171'1234>5-
*"'1*=4>5-%1*%176"*B4<"TB4761G7%76"%2"*(4<<41>%1C%D?*#?*=%MG<4>"<<%N'611A$

1
This document is authorized for use only in Prof. D K Batra's PGDM-II/ Sales & Distribution Management- at International Management Institute - New Delhi (IMI) from Jun 2020 to Oct 2020.
 589-017 Dunkin' Donuts (E): 1988 Distribution Strategies

The Dunkin’ Donuts Customer

Y>%?==4741>%71%76"%C*"<6%=1G56>G7<%<45>4C4"=%4>%47<%>?("-%&G>U4>V%%&1>G7<%<1A=%176"*%*"A?7"=
2*1=G'7<-% <G'6% ?<% (GCC4><-% '*14<<?>7<-% '11U4"<-% <1G2-% ?>=% '*14<<?>7% <?>=B4'6"<$% % S"#"*76"A"<<-
'G<71("*<% <7*1>5A3% ?<<1'4?7"=% 76"% <71*"<% B476% =1G56>G7<% ?>=% '1CC""$% % Y>% ?% >?741>B4="% <?(2A"% 1C
'G<71("*<%B61%A4#"=%B4764>%+I%(4>G7"<%1C%?%&G>U4>V%&1>G7<%<612-%:La%6?=%2G*'6?<"=%=1G56>G7<%1>
76"4*%A?<7%#4<47%71%?%&G>U4>V%&1>G7<%<612%_KIa%4>%76"%S1*76"?<7`-%?>=%,/a%6?=%2G*'6?<"=%'1CC""%_I.a
4>%76"%S1*76"?<7`$

E1% ?4=% 4>% 76"4*% (?*U"7% ?>?A3<4<-% '1(2?>3% (?>?5"*<% '?7"51*4b"=% 2G*'6?<"<% )3% A1'?741>% 1C
'1><G(2741>%_Table A`$

Table A &1G56>G7%01><G(2741>%c1'?741><

In Shop In Car At Work At Home

% Purchasersa 20% 12% 17% 46%

% Volume Purchasesa 16% 9% 23% 47%
% Volume Purchases which were
Sold in Dozens -- 60% 92% 88%
Competitive Set other shops, other shops, bakeries, other bakeries,
restaurants, convenience shops, some supermarket
convenience stores convenience bakeries
stores stores

aDoes not sum to 100%; consumption in “other” locations not included.

&G>U4>V% &1>G7<% ?A<1% '?7"51*4b"=% 2G*'6?<"<% )3% 732"% 1C% 1''?<41>Q% % <1'4?A% _++a`-% B1*U% _+9a`-
?>=% C?(4A3% _K/a`$% % @?(4A3% ?>=% <1'4?A% 1''?<41>% 2G*'6?<"<% B"*"% '1><G("=% 2*4(?*4A3% ?7% 61("-% B64A"
K/a% 1C% B1*UH*"A?7"=% 2G*'6?<"<% B"*"% '1><G("=% 4>% 76"% B1*U2A?'"$% % 0G<71("*<% C1*% ?AA% 732"<% 1C
2G*'6?<"%1''?<41><%'61<"%&G>U4>V%&1>G7<%2*4(?*4A3%)"'?G<"%1C%76"%C*"<6>"<<%?>=%'1><4<7">'3%1C%76"
2*1=G'7$% % 01>#">4">'"% 1C% 76"% A1'?741><% B?<% ?>176"*% (?]1*% *"?<1>% C1*% <61224>5% ?7% &G>U4>V% &1>G7<$
@1*%B1*UH*"A?7"=%2G*'6?<"%1''?<41><-%'1>#">4">'"%1C7">%("?>7%W1>%76"%B?3%71%61("%1*%1CC4'"$X

P>176"*% ("761=% 1C% ?>?A3b4>5% 76"% &G>U4>V% &1>G7<% 'G<71("*% B?<% )3% 74("% 1C% 2G*'6?<"
_Table B`$

Table B E4("%1C%c?<7%;G*'6?<"%d''?<41>

Weekday Weekend
Breakfast/ Breakfast/ Noon Late Night Breakfast/ Late Night
AM Snack AM Snack Snack Snack AM Snack Snack
at Shop Takeout Takeout Takeout Takeout Takeout

Purchasers (%) 11% 39% 7% 11% 25% 7%

dC%76"%<?(2A"=%'1><G("*<-%..a%B"*"%6"?#3%G<"*<%_4$"$-%#4<47"=%?%&G>U4>V%&1>G7<%<612%1>'"%?
B""U%1*%(1*"`-%J:a%B"*"%("=4G(%G<"*<%_1>'"%?%(1>76%1*%A"<<%76?>%1>'"%?%B""U`-%?>=%,/a%B"*"%A4567
G<"*<% _A"<<% 76?>% 1>'"% ?% (1>76`$% % D"?#3% G<"*<% ?''1G>7"=% C1*% :La% 1C% ?AA% '1CC""% 2G*'6?<"<-% I,a% 1C% ?AA
=1G56>G7% 2G*'6?<"<-% ?>=% L:a% 1C% ?AA% '*14<<?>7% 2G*'6?<"<$% % @1*% ?AA% G<?5"% A"#"A% <"5(">7<-% 2*1=G'7
2
This document is authorized for use only in Prof. D K Batra's PGDM-II/ Sales & Distribution Management- at International Management Institute - New Delhi (IMI) from Jun 2020 to Oct 2020.
 Dunkin' Donuts (E): 1988 Distribution Strategies 589-017

FG?A473%?>=%C*"<6>"<<%B"*"%76"%(1<7%4(21*7?>7%*"?<1><%C1*%<61224>5%?7%&G>U4>V%&1>G7<$%%D1B"#"*-
C1*% 6"?#3% G<"*<% <G2"*41*% '1CC""% ?>=% FG4'U% <"*#4'"% 2A?3"=% ?% 5*"?7"*% *1A"% 4>% 76"4*% ="'4<41>% 71% <712% ?7
&G>U4>V% &1>G7<% 76?>% 47% =4=% C1*% A"<<HC*"FG">7% 2G*'6?<"*<$% % D"?#3% G<"*<% ?A<1% =4CC"*"=% C*1(% A4567% ?>=
("=4G(%G<"*<%?A1>5%<"#"*?A%176"*%=4("><41><%_Table C`$

Table C &"5*""%1C%^<?5"%01(2?*4<1>

Light/Medium Users Heavy Users

Planned Visits 44% 66%

Purchased for Self Only 19% 30%
Weekday Breakfast/AM Snack 34% 45%
Consumed at Shop 18% 38%

P(1>5%76"%<?(2A"=%'1><G("*<-%2*1=G'7%?B?*">"<<%B?<%6456"<7%4>%76"%S1*76"?<7%?>=%A1B"<7
4>% 76"% N1G76B"<7R["<7$% % E*4?A% 1C% ?AA% >1>H=1G56>G7% 2?<7*3% 47"(<% B?<% ?A<1% A1B"*% 4>% 76"
N1G76B"<7R["<7$% % ;G*'6?<"*<% 4>% 76"% N1G76B"<7R["<7% B"*"% A"<<% A4U"A3% 71% )"% 2G*'6?<4>5% C1*
76"(<"A#"<-%(1*"%A4U"A3%71%)"%2G*'6?<4>5%1>%76"%B""U">=-%?>=%(G'6%A"<<%A4U"A3%71%"?7%?7%76"%<612%1*
1*="*%'1CC""%76?>%B"*"%S1*76"?<7"*>%'1><G("*<$

The Competition

&G>U4>V% &1>G7<% '1(2"7"=% B476% 176"*% =1G56>G7% <612<-% )?U"*4"<-% % <G2"*(?*U"7% )?U"*4"<-
*"<7?G*?>7<-% ?>=% '1>#">4">'"% <71*"<$% % @?<7% C11=% *"<7?G*?>7<% 5">"*?AA3% B"*"% >17% '1><4="*"=% =4*"'7
'1(2"7471*<$%%D1B"#"*-%76"%<7*1>5%">7*3%1C%O'&1>?A=V<%4>71%76"%)*"?UC?<7%(?*U"7% 6?=%'6?>5"=%76?7
#4"B214>7% <1("B6?7$% % &G>U4>V% &1>G7<% ?A<1% '1(2"7"=% 4>=4*"'7A3% B476% W<>?'UX% C*?>'64<"<% <G'6% ?<
&?4*3%\G"">%_4'"%'*"?(`%?>=%76"%#?*41G<%51G*("7%'11U4"%<612<$

01(2"74741>%C*1(%'1>#">4">'"%<71*"<%?>=%<G2"*(?*U"7%)?U"*4"<%B?<%)"'1(4>5%4>'*"?<4>5A3
?'G7"$% % Y>% +9::% 76"*"% B"*"% 1#"*% ./-///% <G2"*(?*U"7% )?U"*4"<-% ?>=% 76"% <"'1>=HA?*5"<7% <"AA4>5% 47"(% 4>
761<"%)?U"*4"<%B?<%=1G56>G7<$%%O1*"1#"*-%'1>#">4">'"%<71*"<%B"*"%"Z2?>=4>5%4>71%C11=%<"*#4'"%?7%?>
?A?*(4>5% *?7"% ?>=% 6?=% )"'1("% ?% <"*41G<% 76*"?7$% % Y>% +9::-% ?22*1Z4(?7"A3% +.a% 1C% '1>#">4">'"% <71*"
*"#">G"<%B"*"%C*1(%C11=%<"*#4'"%<?A"<$%%O?>3-%4C%>17%(1<7-%'1>#">4">'"%<71*"<%1CC"*"=%'1CC""%?>=%C*"<6
1*%2?'U?5"=%=1G56>G7<-%?>=%)"'?G<"%1C%76"4*%G)4FG471G<%A1'?741><%_?22*1Z4(?7"A3%LI-///%>?741>B4="`
?>=%A1>5%61G*<-%76"3%'1(2"7"=%#451*1G<A3%C1*%'1((G7"*%?>=%4(2GA<"%2G*'6?<"<$

&G>U4>V% &1>G7<% (?>?5"*<% B"*"% '1>#4>'"=% 76?7% '1><G("*<% B61% 2G*'6?<"=% =1G56>G7<% ?7% ?
'1>#">4">'"%<71*"%B"*"%A11U4>5%2*4(?*4A3%C1*%'1>#">4">'"-%>17%2*1=G'7%FG?A473$%%01>#">4">'"%<71*"<
2G*'6?<"=%2?'U?5"=%=1G56>G7<%C*1(%)?U"*4"<%?>=%C*"<6%=1G56>G7<%C*1(%A1'?A%=1G56>G7%<612<-%)G7
1C7">% U"27% 76"(% 1>% 76"% <6"A#"<% G>74A% <1A=% 1G7-% <1("74("<% A1>5% ?C7"*% 76"3% 6?=% A1<7% 76"4*% C*"<6>"<<$
O?>3% &G>U4>V% &1>G7<% C*?>'64<""<% <1A=% B61A"<?A"% G>)*?>="=% =1G56>G7<% 71% 76"% A1'?A% '1>#">4">'"
1G7A"7<$

&G>U4>V% &1>G7<% C*?>'64<""<% ?A<1% '1(2"7"=% B476% 1>"% ?>176"*$% % S"B% C*?>'64<""<% ?>=% 761<"
<""U4>5%71%"Z2?>=%B1GA=%1''?<41>?AA3%24'U%>"B%A1'?741><%B64'6%B1GA=%=*?B%<1("%'G<71("*<%?B?3
C*1(%?>%"Z4<74>5%C*?>'64<""$

&G>U4>V% &1>G7<% C*?>'64<"% ?5*""(">7<% 7324'?AA3% 5*?>7"=% 76"% C*?>'64<""% 76"% *4567% 71% 12"*?7"
1>A3% ?7% ?% <2"'4C4"=% A1'?741>% ?>=% 2*1#4="=% >1% 7"**471*4?A% "Z'AG<4#473$% % Y>% 176"*% B1*=<-% ?>% 12"*?74>5
C*?>'64<""% '1GA=% C4>=% 76?7% ?>176"*% C*?>'64<""% 6?=% )"">% 5*?>7"=% 76"% *4567% 71% 12">% ?>% 1G7A"7% 4>% 'A1<"
2*1Z4(473% 71% 47<% 2*"#41G<A3% 12"*?74>5% 1G7A"7$% % E6"% '1(2?>3% 6?=% ?=127"=% ?>=% 2G)A4<6"=% 71% 76"
C*?>'64<""<%?%21A4'3%76?7%2*1#4="=% C1*% ?% C1*(?A% 5*4"#?>'"% 2*1'"=G*"% 4C% 76"% '1(2?>3% 6?=% ="#"A12"=

3
This document is authorized for use only in Prof. D K Batra's PGDM-II/ Sales & Distribution Management- at International Management Institute - New Delhi (IMI) from Jun 2020 to Oct 2020.
 589-017 Dunkin' Donuts (E): 1988 Distribution Strategies

76"%2*12"*73%C1*%76"%>"B%1G7A"7%_4$"$-%4C%76"%'1(2?>3%6?=%C1G>=%76"%<47"-%2G*'6?<"=%1*%A"?<"=%76"%A?>=
?>=% )G4A=4>5-% ?>=% <G)A"7% 76"% 2*12"*73% 71% 76"% C*?>'64<""`$% % E6"% 5*4"#?>'"% 2*1'"=G*"% ?AA1B"=% ?>
"Z4<74>5% C*?>'64<""% 71% 1)]"'7% 71% 76"% A1'?741>% 1C% 76"% >"B% 1G7A"7% )"C1*"% ?% '1((477""% 1C% '1(2?>3
"Z"'G74#"<%?>=%176"*%C*?>'64<""<$%%Y>%2*"2?*?741>%C1*%76"%C1*(?A%6"?*4>5-%76"%'1(2?>3%B1GA=%5?76"*
"Z7"><4#"%"#4=">'"%1C%76"%"Z2"'7"=%"CC"'7<%1C%76"%>"B%A1'?741>%1>%76"%"Z4<74>5%C*?>'64<""V<%<612$%%E6"
'1((477""-%?C7"*%6"?*4>5%?AA%1C%76"%'1(2?>3V<%?>=%C*?>'64<""V<%"#4=">'"-%%B1GA=%?77"(27%71%<6?2"%?
'1(2*1(4<"%<1AG741>-%1*%*"'1((">=%"476"*%76?7%76"%<612%)"%12">"=%1*%>17$%%D1B"#"*-%76"%'1(2?>3
*"7?4>"=%76"%*4567%71%12">%76"%<612%?5?4><7%76"%*"'1((">=?741>%1C%76"%5*4"#?>'"%'1((477""$

YC%76"%>"B%1G7A"7%B?<%">74*"A3%C*?>'64<""%="#"A12"=%_4$"$-%4C%?%2*1<2"'74#"%C*?>'64<""%C1G>=%76"
<47"% ?>=% 2G*'6?<"=% 1*% A"?<"=% 76"% A?>=% ?>=% )G4A=4>5% =4*"'7A3% C*1(% ?% 764*=% 2?*73`-% 76"% 5*4"#?>'"
2*1'"=G*"%=4=%>17%?22A3$%%^>="*%761<"%'4*'G(<7?>'"<-%?>747*G<7%A?B%(?="%47%4AA"5?A%C1*%76"%'1(2?>3%71
W'1><24*"X% B476% "Z4<74>5% C*?>'64<""<% 71% 2*"'AG="% ?>176"*% C*?>'64<""% C*1(% 12">4>5% ?% <612% 4>% ?>
176"*B4<"% <G47?)A"% A1'?741>$% % P>3% <G'6% ="7"*(4>?741>% 6?=% 71% )"% (?="% G>4A?7"*?AA3% )3% 76"% '1(2?>3
?''1*=4>5% 71% <1("% G>4C1*(A3% ?22A4"=% '*47"*4?$% % E6"% '1(2?>3-% 76"*"C1*"-% '?*"CGAA3% <'*"">"=% ?AA
217">74?A%>"B%A1'?741><-%"Z?(4>4>5%76"%'1(2"7474#"%">#4*1>(">7-%<?A"<%?>=%2*1C47<%1C%>"?*)3%&G>U4>V
&1>G7<%<612<-%<61224>5%?'74#473-%="(15*?264'<-%?>=%76"%263<4'?A%?77*4)G7"<%1C%76"%<47"%4>%?>%?77"(27
71% 1274(4b"% &G>U4>V% &1>G7<V<% 2">"7*?741>% _4$"$-% =4<7*4)G741>`% 2?77"*>% 4>% "?'6% (?*U"7% B4761G7
]"12?*=4b4>5% 76"% )G<4>"<<"<% 1C% "Z4<74>5% C*?>'64<""<$% % YC% 76"% '1(2?>3% =4<?5*""=% B476% 76"% C*?>'64<""V<
'614'"%1C%A1'?741><-%47%<">7%?%W<47"%="C4'4">'3%A"77"*X%1G7A4>4>5%76"%*"?<1><%47%B1GA=%>17%?22*1#"%76"%<47"$

The Franchisees

[64A"% (?>3% )G<4>"<<% C1*(?7% C*?>'64<1*<% ?22*1Z4(?7"=% ?% )?A?>'"% % )"7B"">% 76"% >G()"*% 1C
'1(2?>3H1B>"=% ?>=% C*?>'64<"=% 1G7A"7<-% &G>U4>V% &1>G7<% B?<% ?A(1<7% "Z'AG<4#"A3% ?% C*?>'64<4>5
'1(2?>3$%%Y>%+9K9%76"%C*?>'64<1*-%&G>U4>V%&1>G7<%1C%P("*4'?-%12"*?7"=%++/%<612<$%%N7?CC4>5%2*1)A"(<
?>=% 4>'*"?<4>5% ?=(4>4<7*?74#"% '1<7<% A"=% 76"% '1(2?>3% 71% *"=G'"% 76"% >G()"*% 1C% '1(2?>3H12"*?7"=
<612<-% ?>=% 1C% 76"% +-JK:% G>47<% 4>% 12"*?741>% 4>% S1*76% P("*4'?% ?7% 76"% ">=% 1C% C4<'?A% +9:K-% 76"% '1(2?>3
12"*?7"=%1>A3%.9%G>47<$%%PA761G56%&G>U4>V%&1>G7<%47<"AC%12"*?7"=%*"A?74#"A3%C"B%G>47<-%76*1G561G7%47<
64<71*3% 47% 6?=% )"">% #"*3% ?'74#"% 4>% ?'FG4*4>5% *"?A% "<7?7"% _"476"*% )3% "Z7">="=% A"?<"% 1*% 2G*'6?<"`% ?>=
="#"A124>5%G>47<%71%)"%12"*?7"=%)3%47<%C*?>'64<""<$%%Y>%C?'7-%76"%'1(2?>3%="*4#"=%(1*"%*"#">G"%C*1(
*">7?A%4>'1("%C*1(%C*?>'64<""<%12"*?74>5%'1(2?>3H="#"A12"=%G>47<%76?>%47%=4=%C*1(%47<%717?A%1>514>5
C*?>'64<"%*13?A73%C""<$%%@*?>'64<""%*">7?A%C""<%B"*"%'?A'GA?7"=%?<%"476"*%76"%W)?<"%*">7X%_="7"*(4>"=%)3
76"%'?247?A4b"=%'1<7%1C%?'FG4*4>5%?>=%="#"A124>5%76"%2*12"*73`%1*%+.a%1C%76"%C*?>'64<""V<%5*1<<%<?A"<T
B64'6"#"*%B?<%5*"?7"*T?>=%B"*"%4>%?==4741>%71%76"%*13?A73%_J$9a%1C%5*1<<%<?A"<`%?>=%?=#"*74<4>5%C""<
_Ia%1C%5*1<<%<?A"<`$%%Table D%2*"<">7<%<1("%="7?4A<%1>%'1(2?>3H="#"A12"=%?>=%'1(2?>3H'1>7*1AA"=
*"?A%"<7?7"$%%_N""%Exhibits 1%?>=%2%C1*%C*?>'64<""%?>=%'1(2?>3%12"*?74>5%*"<GA7<$`

Table D SG()"*%1C%01(2?>3H&"#"A12"=%?>=%01(2?>3H01>7*1AA"=%!"?A%e<7?7"%+9:,H+9:K

1987 1986 1985 1984 1983

Lease Land and Building 382 392 395 416 437

Lease Land and Own Building 345 332 316 299 288
Own Land and Building 215 219 216 200 168
Total 942 943 927 915 893
Total Number of Shops in N. America 1,478 1,397 1,321 1,260 1,210

PA761G56%<74AA%6"?#4A3%4>#"<7"=%4>%*"?A%"<7?7"-%4>%+9::%&G>U4>V%&1>G7<%B?<%?'74#"A3%?77"(274>5
71%*"=G'"%76"%2"*'">7?5"%1C%'1(2?>3H="#"A12"=%<612<$%%Y>%76"%"?*A3%+9:/<-%?22*1Z4(?7"A3%:/a%1C%?AA
>"B% C*?>'64<""H12"*?7"=% <612<% B"*"% '1(2?>3% ="#"A12"=$% % M"7B"">% +9:/% ?>=% +9:K-% "<'?A?74>5
="#"A12(">7%'1<7<%?>=%?%<?A"<%5*1B76%="'A4>"%C*1(%:a%71%.a%A"=%71%?%=*12%4>%76"%<?A"<H71H'?247?A%*?741
4
This document is authorized for use only in Prof. D K Batra's PGDM-II/ Sales & Distribution Management- at International Management Institute - New Delhi (IMI) from Jun 2020 to Oct 2020.
 Dunkin' Donuts (E): 1988 Distribution Strategies 589-017

C1*%?%7324'?A%<612%C*1(%+$+Q+%71%A"<<%76?>%+Q+$%%P<<G(4>5%76"%.a%<?A"<%5*1B76%*?7"%*"(?4>"=%'1><7?>7-
?#"*?5"%*">7?A%4>'1("%2"*%<71*"%_)"'?G<"%1C%76"%)?<"%*">7%'?A'GA?741>`%?>=%2*1]"'7"=%!dY%C1*%&G>U4>V
&1>G7<% B1GA=% ="'A4>"% <45>4C4'?>7A3$% % O1*"1#"*-% 76"% >G()"*% 1C% C*?>'64<""% 1)]"'741><% 71% 2A?>>"=
="#"A12(">7% B?<% 4>'*"?<4>5% ?>=% 76"% '1(2?>3V<% &"#"A12(">7% f*1G2% B?<% <2">=4>5% ?22*1Z4(?7"A3
J/a%1C%47<%74("%?>=%?%<G)<7?>74?A%?(1G>7%1C%(1>"3%C45674>5%C1*(?A%5*4"#?>'"<%_Table E`$%%E6"%*"7G*>
1>%4>#"<7(">7%4>%<612%="#"A12(">7-%76"*"C1*"-%)"'?("%(?*54>?A%71%76"%2G)A4'A3%6"A=%'1(2?>3-%?>=
4>% 1*="*% 71% C*""% '?247?A% C1*% (1*"% ?77*?'74#"% ?A7"*>?74#"<-.% % <">41*% (?>?5"(">7% )"5?>% 71% <64C7% 76"
="#"A12(">7%)G*=">%71%76"%C*?>'64<""<$

Table E @1*(?A%f*4"#?>'"%;*1'"=G*"<%+9:.H+9:K

1982 1983 1984 1985 1986 1987

Number of grievances 15 10 18 28 20 8

@*?>'64<""<% B476% C"B"*% 4>#"<7(">7% ?A7"*>?74#"<% 76?>% 76"% '1(2?>3% ?>=% ?>% 1221*7G>473% 71
)G4A=% 2"*<1>?A% "FG473% 4>% 76"% 2*12"*73% 1C7">% C1G>=% 76"% *"7G*><% 1>% ="#"A124>5% 76"4*% 1B>% *"?A% "<7?7"
#"*3% ?77*?'74#"% _?<<G(4>5% 76"3% 6?=% <GCC4'4">7% '?247?A% 71% =1% <1`$% % @*?>'64<""<% B61% ="#"A12"=% ?>=
'1>7*1AA"=%76"4*%1B>%*"?A%"<7?7"%?A<1%2*1#"=%71%)"%(1*"%'1((477"=%71%76"%)G<4>"<<%?>=%(?>?5"=%76"
12"*?741>% (1*"% 'A1<"A3-% 76"*")3% ?'64"#4>5% )"77"*% *"7G*><% 76?>% C1*% '1(2?>3H="#"A12"=% <71*"<$
D1B"#"*-% 4>% <1("% *?24=A3% ?22*"'4?74>5% *"?A% "<7?7"% (?*U"7<-% C*?>'64<""<% B"*"% B4AA4>5% 71% ="#"A12
(?*54>?A%<47"<%?>=%*G>%'A1<"%71%)*"?U"#">-%B476%76"%4>7">741>%1C%"#">7G?AA3%<"AA4>5%76"%C*?>'64<"%?>=
*"7?4>4>5% 76"% *"?A% "<7?7"% ?<% A?>=A1*=$% % E64<% 2*1#4="=% C1*% (G'6% (1*"% 4>7"><4#"% =4<7*4)G741>% 4>% 761<"
(?*U"7<$%%N1("%C*?>'64<""<%B4<64>5%71%"Z2?>=%1*%71%2*17"'7%76"4*%?*"?<%C*1(%76"%"Z2?><41>% 1C%176"*
C*?>'64<""<-% )G7% A?'U4>5% 76"% '?247?A% 71% ="#"A12% 76"4*% 1B>% 2*12"*73-% )"'?("% C*G<7*?7"=% )3% 76"
'1(2?>3V<%5*1B4>5%G>B4AA4>5>"<<%71%="#"A12%<47"<%C1*%A"?<"%71%C*?>'64<""<$

M3% +9:K% >"?*A3% :/a% 1C% ?AA% >"B% <612<% B"*"% C*?>'64<""H="#"A12"=$% % E64<% B?<% (G'6% "?<4"*% 71
?''1(2A4<6% 4>% !"541>% Y% _76"% "?<7"*>% ^>47"=% N7?7"<% ?>=% 0?>?=?`% B6"*"% KIa% 1C% ?AA% =1("<74'% &G>U4>V
&1>G7<%<612<%B"*"%A1'?7"=-%B6"*"%76"%?#"*?5"%<71*"%<?A"<%B"*"%<45>4C4'?>7A3%6456"*%76?>%4>%!"541>%YY
_76"%B"<7"*>%^>47"=%N7?7"<`-%?>=%B6"*"%"Z4<74>5%C*?>'64<""<%B"*"%(G'6%(1*"%?'74#"%4>%2G*'6?<4>5%*"?A
"<7?7"% ?>=% ="#"A124>5% <71*"<% 4>% 1*="*% 71% "Z2?>=% 76"4*% "Z4<74>5% 12"*?741><$% % _Exhibit 1% 2*"<">7<
C*?>'64<""%12"*?74>5%*"<GA7<%)3%<G)H!"541>$`

Regional Differences

Y>%+9K:-%76"%'1(2?>3%6?=%?=127"=%?%6456A3%C1'G<"=%<7*?7"53%1C%5*1B4>5%4>%(?*U"7<%B6"*"%47
?A*"?=3% 6?=% 76"% 5*"?7"<7% 2">"7*?741>-% ?>=% CG*76"*% ="#"A12(">7% 1C% !"541>% Y% >?7G*?AA3% )"'?("% ?>
4>7"5*?A%2?*7%1C%76?7%<7*?7"53$%%M"7B"">%+9:,%?>=%+9:K-%KJa%1C%?AA%>"B%<612<%B"*"%12">"=%4>%!"541>%Y$
PA761G56%B4="A3%'1><4="*"=%?%>?741>?A%'6?4>-%&G>U4>V%&1>G7<%6?=%<612<%4>%1>A3%+L:%1C%76"%,,J%^$N$
N7?>=?*=% O"7*121A47?>% N7?74<74'?A% P*"?<$% % Y>% +9:K% 76"*"% B"*"% +-+//% &G>U4>V% &1>G7<% <612<
'1>'">7*?7"=%4>%9L%1C%76"%+IL%NONP<%1C%!"541>%Y$%%Y>%!"541>%YY%76"*"%B"*"%,K:%<612<%4>%K+%1C%76"%+K:
=4CC"*">7% NONP<$% % % E6"% J.,% >"B% <612<% 12">"=% C*1(% +9:,% 71% +9:K% B"*"% A1'?7"=% 4>% 1>A3% KI% =4CC"*">7
NONP<-%?A(1<7%?AA%1C%B64'6%?A*"?=3%6?=%12"*?74>5%<612<$%%E6"%6456A3%C1'G<"=%="#"A12(">7%<7*?7"53
6?=%<45>4C4'?>7A3%4>'*"?<"=%76"%'1>'">7*?741>%1C%<612<%4>%?%*"A?74#"A3%<(?AA%>G()"*%1C%(?*U"7<$

%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%
2.%%Y>%+9:L%76"%'1(2?>3%?'FG4*"=%76"%*4567<%71%064A4V<%!"<7?G*?>7%?>=%M?*%C1*%?AA%1C%S"B%e>5A?>=$%%E6"%?'FG4<4741>
1C% ?% 064A4V<% ?*"?% C*?>'64<"% *"CA"'7"=% 76"% C4*<7% =4#"*<4C4'?741>% (1#"% <4>'"% 76"% '1(2?>3% 6?=% =4#"<7"=% <"#"*?A
<G)<4=4?*4"<%4>%76"%"?*A3%+9K/<%71%'1>'">7*?7"%1>%5*1B4>5%76"%=1G56>G7%)G<4>"<<$
5
This document is authorized for use only in Prof. D K Batra's PGDM-II/ Sales & Distribution Management- at International Management Institute - New Delhi (IMI) from Jun 2020 to Oct 2020.
 589-017 Dunkin' Donuts (E): 1988 Distribution Strategies

Y>% ?*"?<% <G'6% ?<% M1<71>-% O?<<?'6G<"77<-% ?>=% ;*1#4=">'"-% !61="% Y<A?>=-% B6"*"% (?>3% 1C% 76"
1A="<7%?>=%(1<7%<G''"<<CGA%C*?>'64<"<%B"*"%A1'?7"=-%C*?>'64<""%="#"A12(">7%B?<%?A(1<7%C*">"74'-%?>=
)3%+9::%1#"*2">"7*?741>%6?=%)"'1("%'*474'?A$%%Y>%<1("%?*"?<%1C%!"541>%Y-%&G>U4>V%&1>G7<%<612<%B"*"
A1'?7"=% B4764>% J% )A1'U<% 1C% "?'6% 176"*$% % S"B% C*?>'64<""<-% 61B"#"*-% ?''1G>7"=% C1*% 1>A3% ./a% 1C% 76"
C*?>'64<""H="#"A12"=%G>47<$%%eZ4<74>5%C*?>'64<""<-%*"<21>=4>5%71%B6?7%'1(2?>3%(?>?5"*<%*"C"**"=%71
?<%76"%WC"?*%?>=%5*""=X%C?'71*<-%<1G567%71%"Z2?>=%76"4*%1B>%)G<4>"<<"<%?>=%2*"'AG="%="#"A12(">7%4>
76"4*%?*"?%)3%'1(2"74>5%C*?>'64<""<$%%M3%="#"A124>5%511=%2*12"*74"<%B6"*"#"*%76"3%'1GA=%C4>=%76"(-
76"3% B"*"% <1("74("<% C1*'"=% 71% WA"?2C*15X% 1#"*% 176"*% C*?>'64<""<-% ?>=% =4CC"*">7% (GA74HG>47
C*?>'64<""<V% <612<% )"'?("% 4>7"*(4>5A"=% B4764>% 76"% <?("% <(?AA% (?*U"7% ?*"?<$% % M3% +9::-% <1("
(?>?5"*<% C"A7% 76?7% ="#"A12(">7% 4>% 2?*7<% 1C% !"541>% Y% B"*"% 1G7% 1C% '1>7*1A$% % d#"*?AA% <?A"<% 4>% 761<"
(?*U"7<% B"*"% 4>'*"?<4>5% ?>=% 76"% *"541>% '1>7?4>"=% (?>3% 1C% 76"% (1<7% 2*1C47?)A"% <71*"<-% )G7% <1("
4>=4#4=G?A% <71*"% <?A"<% B"*"% <GCC"*4>5$% % PA761G56% 1#"*?AA% <3<7"(% (1*?A"% *"(?4>"=% 6456-% <1("
C*?>'64<""<% B"*"% 5"774>5% 4>'*"?<4>5A3% ?>5*3% B476% 76"% '1(2?>3% C1*% ?22*1#4>5% <47"<% B64'6% 4>'*"?<"=
717?A%(?*U"7%<?A"<%?>=%C*?>'64<"%*13?A74"<%)G7%6G*7%76"4*%4>=4#4=G?A%)G<4>"<<"<-%?>=%<1("%A1<7%C?476%4>
76"% '1(2?>3V<% B4AA4>5>"<<% 71% A11U% ?C7"*% 76"4*% 4>7"*"<7<$% % M3% '1>7*?<7-% 4>% !"541>% YY-% B6"*"% 76"*"% B?<
*"A?74#"A3% A477A"% C*?>'64<""H"Z2?><41>% ?'74#473-% B6">% 4>'*"?<"=% (?*U"7% 2">"7*?741>% 711U% 2A?'"-% 47% B?<
(1<7%1C7">%)"'?G<"%76"%'1(2?>3%6?=%="#"A12"=%76"%2*12"*73%47<"AC$

E6"%=4CC"*">'"<%)"7B"">%!"541>%Y%?>=%YY%B"*"%=G"%2*4(?*4A3%71%76"%64<71*4'?A%="#"A12(">7%1C
76"%'1(2?>3%?>=%71%76"%"Z2"*4">'"%?>=%<1264<74'?741>%1C%76"%A1'?A%C*?>'64<""<$%%E6"%1*454>?A%)?<"%1C
12"*?741><% 6?=% )"">% 4>% 76"% >1*76"?<7"*>% ^>47"=% N7?7"<-% ?>=% ="#"A12(">7% 76"*"% 6?=% )"">% 4>7"><4#"$
e?*A3%C*?>'64<""<%"Z2?>="=%B476% 76"% '1(2?>3-% 1C7">% C1*(4>5% 2?*7>"*<642<% B476% C?(4A3% ("()"*<% 71
12">%?==4741>?A%<71*"<$%%O?>3%1C%76"% (1<7%<G''"<<CGA%1*454>?A%C*?>'64<""<% 6?=% <7*1>5% '1>>"'741><% 71
76"4*% ;1*7G5G"<"% 6"*47?5"-% ?>=% B"*"% 2?*7% 1C% ?% <G)<7?>74?A% A1'?A% ;1*7G5G"<"% '1((G>473$% % [6">% 76"3
<G''""="=% ?<% &G>U4>V% &1>G7<% C*?>'64<""<-% 76"3% ?77*?'7"=% ?% <45>4C4'?>7% >G()"*% 1C% *"A?74#"<-% C*4">=<-
>"456)1*<-%?>=%176"*%*"'">7%;1*7G5G"<"%4((45*?>7<%4>71%76"%C*?>'64<"%<3<7"($%%E6"%*"<GA74>5%>"7B1*U
1C%4>7"*'1>>"'7"=%1B>"*<642%?(1>5%"Z7">="=%C?(4A4"<%?>=%C*4">=<%A"=%71%?%'1>74>G473%1C%"Z2"*4">'"
?>=% 4>#"<7(">7% 4>% 76"% <3<7"(% 4>% 76?7% ?*"?% 1C% 76"% '1G>7*3% B64'6% <1A4=4C4"=% 76"% '1(2?>3V<% A"?=4>5
(?*U"7%21<4741>$

eZ2?><41>% 4>% 176"*% ?*"?<% 1C% 76"% '1G>7*3% B?<% <1("B6?7% 6?26?b?*=$% % Y>% 76"% +9L/<% B6">
&G>U4>V%&1>G7<%B?<%"Z2"*4">'4>5%?%J/a%5*1B76%*?7"-%?%)"A4"C%76?7%76"%'1(2?>3%'1GA=%=1%>1%B*1>5
A"=% 71% '1(2A"7"A3% G>=4<'42A4>"=% ="#"A12(">7$% % @1*% "Z?(2A"-% 4>% +9L:-% ?% &G>U4>V% &1>G7<% *"?A% "<7?7"
(?>?5"*% 4>% 76"% N1G76B"<7% B?<% *"21*7"=% 71% 6?#"% *">7"=% ?% c"?*% ]"7% ?>=% ?22*1#"=% ++% >"B% <612% <47"<
B4761G7%"#"*%A?>=4>5$

E6"% <21773% ="#"A12(">7% 1C% !"541>% YY% 6?=% A"C7% &G>U4>V% &1>G7<% B476% A477A"% 7*?="(?*U
*"'15>4741>%?>=%>1%(?*U"74>5%1*%12"*?741>?A%"CC4'4">'4"<%4>%(1<7%(?*U"7%?*"?<$%%E64<%2G7%76"%'1(2?>3
?7%?%=4<74>'7%=4<?=#?>7?5"%B6">%C?'"=%B476%?%<"*41G<%'1(2"7471*%B4AA4>5%71%4>#"<7%6"?#4A3%71%?'64"#"
(?*U"7%2">"7*?741>$%%@1*%"Z?(2A"-%&G>U4>V%&1>G7<%6?=%12">"=%:%<71*"<%4>%g?><?<%0473$%%[4>'6"AAV<-%?
0?A4C1*>4?H)?<"=% =1G56>G7% '6?4>% B476% L//% <71*"<-% "Z2?>="=% "?<7B?*=% 4>71% 76"% g?><?<% 0473% (?*U"7
?>=%("7%&G>U4>V%&1>G7<%6"?=%1>$%%[4764>%7B1%3"?*<-%[4>'6"AAV<%6?=%12">"=%.,%<612<-%?>=%&G>U4>V
&1>G7<%6?=%'A1<"=%?AA%1C%47<%<71*"<$

P#"*?5"% <71*"% <?A"<% B"*"% <45>4C4'?>7A3% A1B"*% 4>% !"541>% YY% 76?>% 4>% !"541>% Y-% ?>=% 76"*"% B"*"
(1*"%76?>%7B4'"%?<%(?>3%<612<%4>%!"541>%YY%1>%*">7%*"A4"C%_4$"$-%76"%2*?'74'"%1C%?AA1B4>5%?%<7*G55A4>5
C*?>'64<""% 71% <45>% ?% >17"% C1*% 76"% ?''*G4>5% *">7% 4>% 1*="*% 71% *"A4"#"% '?<6% CA1B% 2*1)A"(<% ?>=% ?#14=
'A1<4>5%76"%<612`$%%d>"%1C%76"%5*"?7"<7%'1>7*?<7<%)"7B"">%76"%7B1%!"541><%B?<%4>%76"%?(1G>7%1C%'1CC""
<1A=$% % S1*76"?<7"*>% &G>U4>V% &1>G7<% 1G7A"7<% B"*"% 2*4(?*4A3% '1CC""% <612<% B6"*"% 'G<71("*<% '?("% 71
)G3%1>"%1*%7B1%=1G56>G7<%?>=%?%'G2%1C%'1CC""$%%e#"*3B6"*"%"A<"%4>%76"%'1G>7*3-%&G>U4>V%&1>G7<%B?<
2*4(?*4A3% ?% =1G56>G7% <612% B6"*"% 'G<71("*<% 2G*'6?<"=% =1G56>G7<% )3% 76"% =1b">$% % N612<% 4>% 76"
S1*76"?<7%?#"*?5"=%?)1G7%.,I%=1b">%=1G56>G7<%?>=%+-9//%'G2<%1C%'1CC""%?%=?3%B64A"%"A<"B6"*"%76"
<612<%?#"*?5"=%.L/%=1b">%=1G56>G7<%?>=%:I/%'G2<%1C%'1CC""$%%E6"%=4CC"*">'"<%6?=%?%<45>4C4'?>7%<?A"<
?>=%2*1C47%4(2?'7$%%&1G56>G7<%?#"*?5"=%h%$JI%?%24"'"-%)G7%<1A=%C1*%?22*1Z4(?7"A3%h,$//%)3%76"%=1b">-
?>=%'1CC""%B?<%?%6456H(?*54>%47"($

6
This document is authorized for use only in Prof. D K Batra's PGDM-II/ Sales & Distribution Management- at International Management Institute - New Delhi (IMI) from Jun 2020 to Oct 2020.
 Dunkin' Donuts (E): 1988 Distribution Strategies 589-017

E6"% '1>74>G473% 1C% 1B>"*<642% '6?*?'7"*4<74'% 1C% !"541>% Y% B?<% >174'"?)A3% ?)<">7% 4>% !"541>% YY$
d>"% '1(2?>3% 12"*?741><% (?>?5"*% "<74(?7"=% 76?7% 1B>"*<642% 1C% ?AA% <612<% 4>% 76"% *"541>% 7G*>"=% 1#"*
?)1G7%"#"*3%C1G*%3"?*<$%%D1B"#"*-%76"*"%B?<%<1("%4>=4'?741>%76?7%76"%<?("%732"%1C%"Z7">="=%C?(4A3
>"7B1*U4>5% 1)<"*#"=% 4>% !"541>% Y% B?<% )"54>>4>5% 71% 7?U"% 2A?'"% 4>% !"541>% YY$% % P% A?*5"% 2"*'">7?5"% 1C
!"541>%YY%C*?>'64<""<%B"*"%*"'">7%4((45*?>7<%71%76"%^>47"=%N7?7"<-%?>=%(?>3%6?=%C?(4A3%?>=%C*4">=<
4>%76"4*% >?74#"%'1G>7*4"<%B61%?A<1% B4<6"=%71%4((45*?7"$%% ^$N$% 4((45*?741>% 21A4'3% 5">"*?AA3% 5*?>7"=
2*"C"**"=%<7?7G<%71%4>=4#4=G?A<%?<<G*"=%1C%?%]1)%4>%76"%^>47"=%N7?7"<$%%&G>U4>V%&1>G7<V<%C*?>'64<""<-%?<
4>="2">=">7%1B>"*<%1C%76"4*% 1B>% )G<4>"<<"<-% B"*"% ?)A"% 71% 1CC"*% ]1)<% 1*% 2?*7>"*<642<% 71% C*4">=<% ?>=
*"A?74#"<-%76"*")3%4>'*"?<4>5%76"4*%'6?>'"<%1C%?77?4>4>5%2"*(?>">7%*"<4=">'3%<7?7G<$

Y>%+9:K-%,:a%1C%76"%C*?>'64<""<%4>% !"541>%YY% B"*"%Y>=4?>-%;?U?<7?>4-%0?()1=4?>-%1*%g1*"?>$

c1>5% 61G*<% ?>=% 764>% 2*1C47% (?*54><% B"*"% ?''"27?)A"% 71% (?>3% 1C% 76"<"% C*?>'64<""<% B61% 6?=
"Z2"*4">'"=%(G'6%(1*"%=4CC4'GA7%'1>=4741><%4>%76"4*%>?74#"%'1G>7*4"<$%%E6"%G<"%1C%C?(4A3%("()"*<%71
B1*U%)"64>=%76"%'1G>7"*%?>=%71%)?U"%76"%=1G56>G7<%6"A2"=%<1A#"%76"%(1<7%<"*41G<%2*1)A"(%C?'4>5%?AA
&G>U4>V%&1>G7<V%C*?>'64<""<-%<7?CC4>5%76"%<612$%%D?#4>5%7*G<7"=%C?(4A3%("()"*<%?7%76"%'?<6%*"54<7"*
?A<1%<"*#"=%71%*"=G'"%76"C7-%<1("74("<%"<74(?7"=%71%*"?'6%.a%71%,a%1C%5*1<<%<?A"<%<3<7"(B4="$

Y>% <1("% (?*U"7<-% 61B"#"*-% &G>U4>V% &1>G7<V% (?>?5"*<% 6?=% <"><"=% ?% >"5?74#"% '1><G("*
*"?'741>%71%76"%B4="<2*"?=%G<"%1C%*"'">7%4((45*?>7<%?<%C*?>'64<""<$%%c?>5G?5"%)?**4"*<%?>=%'GA7G*?A
=4CC"*">'"<%?A<1%'*"?7"=%(?>?5"*4?A%'6?AA">5"<$%%E6"%<1A4=?*473%1C%76"%#?*41G<%"76>4'%'1((G>474"<%B?<
1C7">% *"CA"'7"=% 4>% 76"% *"74'">'"% 1C% 1>"% C*?>'64<""% 71% ?=127% ?% 2*15*?(% G>A"<<% 64<% 1*% 6"*% C*4">=<% B"*"
?A<1% 514>5% 71% ?=127% 47$% % O1*"1#"*-% 4>% 1*="*% 71% 2*17"'7% &G>U4>V% &1>G7<V<% *"2G7?741>% C1*% FG?A473-
'1(2?>3%21A4'3%*"FG4*"=%76?7%=1G56>G7<%?>=%176"*%)?U"=%511=<%)"%=4<'?*="=%?C7"*%?%<2"'4C4"=%74("
2"*41=$% % !"#"*">'"% C1*% C11=-% 61B"#"*-% A"=% <1("% C*?>'64<""<% 71% *"7?4>% 76"% 2*1=G'7<% )"31>=% 76"4*
C*"<6>"<<%A4(47$

Shop Operations

^>A4U"% (?>3% C?<7% C11=% C*?>'64<"<-% &G>U4>V% &1>G7<% <612<% =4=% >17% % ]G<7% 2*"2?*"% 76"% 2*1=G'7
76"3% <1A=-% 76"3% (?>GC?'7G*"=% 47$% % PA761G56% 76"% C*?>'64<""<% *"'"4#"=% "Z7"><4#"% 7*?4>4>5% ?7% &G>U4>V
&1>G7<%^>4#"*<473-%(1<7%6?=%>1%2*"#41G<%C11=%<"*#4'"%"Z2"*4">'"-%?>=%3"7%6?=%71%(?>?5"%76"%*"7?4A
)G<4>"<<%_1*%C*1>7%1C%76"%<612`-%?<%B"AA%?<%76"%)?U4>5%)G<4>"<<%_1*%)?'U%1C%76"%<612`$%%O1<7%<612<%B"*"
12">% .J% 61G*<% ?% =?3-% K% =?3<% ?% B""U$% % E64<% B?<% ?% #"*3% ="(?>=4>5% ]1)-% ?>=% ?<% 1>"% &G>U4>V% &1>G7<
(?>?5"*%2G7%47-%WdG*%C*?>'64<""<%?*"%*"?A%*1AAHG2H76"H<A""#"<-%6?>=<H1>%(?>?5"*<$X

Y>% 1*="*% 71% (""7% 76"% '1(2?>3V<% C*"<6>"<<% <7?>=?*=<-% &G>U4>V% &1>G7<% *"'1((">="=% 76*""
2*1=G'741>%<64C7<Q%%++%;O%71%L%PO-%K%PO%71%++%PO-%?>=%S11>%71%K%;O$%%@*"FG">7%)?U4>5%B?<%#47?A%71
(?4>7?4>4>5%76"%'1(2?>3V<%*"2G7?741>%C1*%C*"<6>"<<-%?>=%76"%'1(2?>3%<"7%<6"ACHA4C"%A4(47<%1>%76"%<?A"
1C%#?*41G<%2*1=G'7<%_"$5$-%C4#"%61G*<%C1*%'?U"%=1G56>G7<-%:%61G*<%C1*%3"?<7%=1G56>G7<-%?>=%+.%61G*<
C1*%(GCC4><`$%%N7?CC4>5%76"%)?U4>5%21<4741><%B?<%"Z7*"("A3%=4CC4'GA7%_2?*74'GA?*A3%4>%!"541>%YY`-%?>=%76"
2"12A"%?77*?'7"=%71%>4567H<64C7%)?U4>5%]1)<%C*"FG">7A3%2*1#"=%>17%71%)"%="2">=?)A"$%%Y>%!"541>%YY%1>
?#"*?5"-%>4567H<64C7%)?U"*<%C?4A"=%71%<61B%G2%C1*%B1*U%1>"%1G7%1C%"#"*3%<4Z%>4567<$%%E64<%1C7">%*"FG4*"=
C*?>'64<""<%"476"*%71%'1("%4>%?7%>4567%71%C4AA%4>-%1*%71%2G7%1>%"Z7*?%6"A2-%76"*")3%="'*"?<4>5%76"4*%2*1C47
(?*54>$% % O?>3% 1C% 76"% C*?>'64<""<% 45>1*"=% 76"% '1(2?>3V<% *"'1((">=?741>% 1C% 76*""H<64C7% )?U4>5
">74*"A3$%%Y>%!"541>%Y%B6"*"%76"%B?5"%*?7"%C1*%)?U"*<%B?<%#"*3%6456-%12"*?71*<%'1GA=%<?#"%1#"*%h,//%?
B""U%)3%*G>>4>5%1>%7B1%<64C7<$%%M"'?G<"%7B1H<64C7%)?U4>5% ]"12?*=4b"=%&G>U4>V%&1>G7<V<%*"2G7?741>
C1*%C*"<6>"<<-%1>"%B?3%76"%'1(2?>3%?77"(27"=%71%(4745?7"%764<%2*1)A"(%B?<%76*1G56%47<%*"<"?*'6%?>=
="#"A12(">7%"CC1*7%71%"Z7">=%76"%<6"AC%A4C"%1C%76"%2*1=G'7$

@*1>7H1CH76"H<71*"%<7?CC4>5%B?<%?A<1%?%<"*41G<%2*1)A"($%%Y>%<1("%?*"?<%1C%!"541>%Y%B6"*"%76"*"
B?<%?>%"<2"'4?AA3%A1B%A"#"A%1C%G>"(2A13(">7-%C*?>'64<""<%C1G>=%?77*?'74>5%*"A4?)A"%'1G>7"*%2"*<1>>"A
?>=%?<<4<7?>7%(?>?5"*<%#"*3%=4CC4'GA7$%%O1<7%C*?>'64<""<%"(2A13"=%?7%A"?<7%1>"%176"*%C?(4A3%("()"*
4>% 76"% 12"*?741>% 1C% 76"% )G<4>"<<% 71% 6"A2% "?<"% 76"% <G2"*#4<1*3% )G*=">$% % Y>% (?*U"7<% B6"*"
G>"(2A13(">7%A"#"A<%B"*"%6456"*%?>=%"(2A13""<%(1*"%*"?=4A3%?#?4A?)A"%=G"%71%="2*"<<"=%"'1>1(4'

7
This document is authorized for use only in Prof. D K Batra's PGDM-II/ Sales & Distribution Management- at International Management Institute - New Delhi (IMI) from Jun 2020 to Oct 2020.
 589-017 Dunkin' Donuts (E): 1988 Distribution Strategies

'1>=4741><-% 76"% <612<V% *"#">G"<% 7">="=% 71% )"% A1B"*% ?<% B"AA$% % Y>'*"?<"<% 4>% A?)1*% '1<7<-% A4U"% '?247?A
4>#"<7(">7<-%76"*"C1*"-%B"*"%<"#"*"A3%<FG""b4>5%C*?>'64<""%2*1C47<$

PA761G56% 76"% 1>H76"H2*"(4<"<% 2*1=G'741>% 1C% =1G56>G7<% (?="% 76"% 12"*?741>% =4CC4'GA7-% 76"
1*454>?A%2*1=G'7%A4>"%B?<%>?**1B%">1G56%76?7%C*?>'64<""<%B"*"%?)A"%71%'1>'">7*?7"%1>%(?U4>5%C*"<6
=1G56>G7<% ?>=% 511=% '1CC""$% % M"'?G<"% 1C% '6?>5"<% 4>% '1><G("*% ?7747G="<% 71B?*=% 6"?A76% ?>=% =4"7-
61B"#"*-% 76"*"% B"*"% C"B"*% =1G56>G7<% <1A=% 4>% +9::% 76?>% 4>% +9L:$% % O"?>B64A"-% 76"% 2*1=G'7% A4>"% 6?=
)"">% "Z7">="=% 71% 4>'AG="% <2"'4?A73% )?U"=% 511=<% _"$5$-% '*14<<?>7<`-% <1G2-% ?>=% <?>=B4'6"<$% % E6"% C1G*
(1<7% *"'">7% (?]1*% A4>"% "Z7"><41><% 6?=% *"FG4*"=% ?==4741>?A% C*?>'64<""% 4>#"<7(">7% 4>% "FG42(">7-
717?A4>5% 1#"*% h./-///$% % Y>% ?==4741>% 71% 76"% )*1?=">4>5% 2*1=G'7% A4>"-% 76"% '1(2?>3% 6?=% "Z2?>="=% 47<
(?*U"74>5%2*15*?(<%<45>4C4'?>7A3-%?==4>5%?%B4="%#?*4"73%1C%2*4'"-%2*1=G'7-%?>=%2*"(4G(%2*1(1741><
1C% B64'6% 76"% C*?>'64<""% 6?=% 71% )"% ?B?*"$% % E6"<"% '6?>5"<% ?=="=% >"B% A"#"A<% 1C% '1(2A"Z473% 71% 76"
'1>'"27-%?>=%76"%C*?>'64<""%'1GA=%>1%A1>5"*%)"%]G<7%?%511=%W=1G56>G7%2"*<1>$X%%N">41*%(?>?5"(">7
?7%&G>U4>V%&1>G7<%B?<%?'G7"A3%?B?*"%1C%76"%=?>5"*<%2*"<">7"=%)3%(?U4>5%76"%'1>'"27%(1*"%'1(2A"Z-
)176%4>%7"*(<%1C%'G<71("*%'1>CG<41>%?>=%76"%)G*=">%1>%76"%C*?>'64<""<$%%01><"FG">7A3-%76"%'1(2?>3
B?<%'1((477"=%71%C4>=4>5%176"*%B?3<%71%4>'*"?<"%<?A"<%?>=%C*?>'64<""%2*1C47<$

d>"%B?3%71%4>'*"?<"%<?A"<%B4761G7%4>'*"?<4>5%76"%'1(2A"Z473%1C%76"%'1>'"27% B?<%71%4>'*"?<"
=4<7*4)G741>%_4$"$-%2G7%(1*"%&G>U4>V%&1>G7<%<612<%4>%"Z4<74>5%1*%>"B%(?*U"7<`-%4>%A1'?741><%'1>#">4">7
71% '1><G("*<$% % d>"% 1C% 76"% (1<7% <"*41G<% 2*1)A"(<% ?A*"?=3% C?'4>5% 76"% C*?>'64<""<-% 61B"#"*-% B?<% 76"
1#"*'?2?'473% 1C% 76"% "Z4<74>5% CGAAH2*1=G'4>5% G>47<$% % Y>% 76"% B"?U"*% (?*U"7<% 76"% "Z'"<<% '?2?'473% B?<
1C7">%=G"%71%A?'U%1C%7*?="(?*U%*"'15>4741>$%%D1B"#"*-%?<%76"%<7*1>5%&G>U4>V%&1>G7<%(?*U"7<%)"'?("
(1*"% ?>=% (1*"% <?7G*?7"=% B476% CGAA% 2*1=G'4>5% <612<-% 76"% 1#"*'?2?'473% 2*1)A"(% 4>7"><4C4"=% 76"*"% ?<
B"AA$%%P%&G>U4>V%&1>G7<V%U47'6">%B476%76"%<7?>=?*=%'1>C45G*?741>%2*1#4="=%76"%2*1=G'741>%'?2?'473
C1*%G2%71%.I/%=1b">%=1G56>G7<%2"*%<64C7$%%D1B"#"*-%<612<%B"*"%7324'?AA3%<7?CC"=%B476%1>"%)?U"*%2"*
<64C7%B61%B?<%?A<1%*"FG4*"=%71%C4>4<6%76"%2*1=G'7<%_4$"$-%5A?b"%1*%C4AA%76"%=1G56>G7<%?C7"*%)?U4>5%76"(`-
?>=% 71% 2*"2?*"% (GCC4><% ?>=% '*14<<?>7<$% % E6"% (?Z4(G(% =1G56>G7% 2*1=G'741>% '?2?'473% G>="*% 76"<"
'1>=4741><% B?<-% 4>% *"?A473-% ?22*1Z4(?7"A3% +J/% =1b">% 2"*% <64C7$% % ;*1=G'741>% B?<% >17% <2*"?=% "#">A3
?'*1<<%76"%7B1%1*%76*""%<64C7<$%%EB1H764*=<%1C%76"%)?U4>5%B?<%=1>"%?7%>4567%)"'?G<"%L/a%1C%"?'6%=?3V<
)G<4>"<<%B?<%=1>"%)"7B"">%L%PO%?>=%+/%PO$

Marketing at Dunkin’ Donuts

E6"*"% B"*"% 76*""% =4<74>'7% '1(21>">7<% 71% 76"% (?*U"74>5% "CC1*7% ?7% % &G>U4>V% &1>G7<$% % E6"
'1*21*?7"% (?*U"74>5% ="2?*7(">7% 6?=% 2*4(?*3% *"<21><4)4A473% C1*% 76"% ="#"A12(">7% 1C% (?*U"74>5
2*15*?(<$% % E6"<"% 2*15*?(<% B"*"% <1A=% 4>71% 76"% C*?>'64<"% 1*5?>4b?741>% )3% +J% C4"A=% (?*U"74>5
*"2*"<">7?74#"<-% B61% ?A<1% (?>?5"=% ?>=% (1>471*"=% 76"% "Z"'G741>% 1C% 76"% 2*15*?(<$,% % @4>?AA3-% 76"
C*?>'64<""<%4(2A"(">7"=%76"%(?*U"74>5%2*15*?(<%?7%76"%<612%A"#"A$

@*?>'64<""<%'1>7*4)G7"=%Ia%1C%5*1<<%<?A"<%71%?>%P=#"*74<4>5%?>=%;*1(1741>%@G>=$%%M"'?G<"%1C
76"% G>"#">% =4<7*4)G741>% 1C% &G>U4>V% &1>G7<% <612<% >?741>B4="-% 76"*"% B?<% >1% >?741>?A% ("=4?
2G*'6?<"=-%?>=%?AA%7"A"#4<41>%?>=%*?=41%?=#"*74<4>5%B?<%1>%?%(?*U"7%1*%*"541>?A%)?<4<$%%Y>%?==4741>%71
?=#"*74<4>5-%(?*U"74>5%C4"A=%*"2*"<">7?74#"<%B"*"%'1><7?>7A3%?A"*74>5%76"%C*?>'64<""<%71%>"B%&G>U4>V
&1>G7<%2*1(1741><$%%E6"%C*?>'64<""<%)1*"%76"%">74*"%"Z2"><"%1C%76"%2*1(1741><%?>=%'1GA=%'611<"%71
2?*74'42?7"% 1*% >17$% % !"'">7A3-% ?22*1Z4(?7"A3% ./a% 1C% 76"% ?=#"*74<4>5% )G=5"7% B?<% )"4>5% <2">7
2*1(174>5% >"B% 2*1=G'7<% <G'6% ?<% <?>=B4'6"<-% B64'6% B"*"% ="<45>"=% 71% <64C7% &G>U4>V% &1>G7<% ?B?3
C*1(%47<%="2">=">'"%1>%=1G56>G7<%?>=%<2*"?=%="(?>=%(1*"%"#">A3%76*1G561G7%76"%=?3$

%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%%
3. Y>% ?==4741>% 71% 76"% (?*U"74>5% *"2*"<">7?74#"<-% 76"% C4"A=% (?>?5"(">7% C1*'"% 1C% &G>U4>V% &1>G7<% '1><4<7"=% 1C
=4<7*4'7% ?>=% ?*"?% (?>?5"*<$% % e?'6% =4<7*4'7% (?>?5"*% B?<% *"<21><4)A"% C1*% 1#"*<""4>5% 76"% 12"*?741><% 1C% "476"*% +K
C*?>'64<"=%1G7A"7<%1*%I%'1(2?>3H12"*?7"=%<71*"<-%="2">=4>5%1>%76"%=4#4<41>%71%B64'6%6"%1*%<6"%B?<%?<<45>"=$
8
This document is authorized for use only in Prof. D K Batra's PGDM-II/ Sales & Distribution Management- at International Management Institute - New Delhi (IMI) from Jun 2020 to Oct 2020.
 Dunkin' Donuts (E): 1988 Distribution Strategies 589-017

N">41*% (?>?5"*<% ?7% &G>U4>V% &1>G7<% B"*"% '1>'"*>"=% ?)1G7% 76"% B?3% 4>% B64'6% <1("
C*?>'64<""<% B"*"% "Z"'G74>5% 76"% (?*U"74>5% 2*15*?(<$% % O1*"1#"*-% 'G<71("*% <?74<C?'741>% A"#"A<-
?A761G56% 6456-% B"*"% CA?7i% ?>=% 76"% A1B"<7H<'1*4>5% 2*1=G'7% '?7"51*3% B?<% =1G56>G7<$% % O?>3% )"A4"#"=
76?7% 76"*"% B?<% ?% <"*41G<% >""=% 71% "476"*% ?77*?'7% (1*"% <1264<74'?7"=% C*?>'64<""<% 1*% 71% <4(2A4C3% 76"
(?*U"74>5% 2*15*?(<% ?>=% 76"% 2*1=G'741>% 2*1'"<<"<$% % P<% C*?>'64<""% 2*1C47% (?*54><% ="'*"?<"=% ?A1>5
B476%76"%<?A"<H71H'?247?A%*?741-%61B"#"*-%47%B?<%4>'*"?<4>5A3%=4CC4'GA7%71%?77*?'7%76"%(1*"%<1264<74'?7"=
4>#"<71*$

Distribution Strategies

&G>U4>V% &1>G7<% (?>?5"(">7% B?<% '1>#4>'"=% 76?7% 76"% ="'*"?<4>5% <?A"<% % 5*1B76-% <74CC">4>5
'1(2"74741>-%?>=%B1*<">4>5%<?A"<H71H'?247?A%*?741%C?'"=%)3%76"%'1(2?>3%?>=%47<%C*?>'64<""<%*"FG4*"=%?
>"B%"(26?<4<%1>%"Z2?>=4>5%=4<7*4)G741>$%%E6*""%=4<74>'7%?22*1?'6"<%"("*5"=Q%%_+`%76"%="#"A12(">7
1C% >"B% ?>=R1*% 2*"#41G<A3% G>="*="#"A12"=% (?*U"7<% _B64'6% '1GA=% 4>'AG="% 76"% *"#47?A4b?741>% 1C% 76"
'1(2?>3H12"*?7"=%<71*"<%=4#4<41>`-%_.`%76"%<?A"%1C%)*?>="=%2*1=G'7<%76*1G56%'1>#">4">'"%<71*"<-%?>=
_,`%12">4>5%<?7"AA47"%_4$"$-%>1>H2*1=G'4>5`%*"7?4A%1G7A"7<$%%&G>U4>V%&1>G7<V<%'1*21*?7"%21A4'3%B?<%71%7"<7
?AA%>"B%2*15*?(<%?>=%<7*?7"54"<%761*1G56A3%)"C1*"%?<U4>5%76"%C*?>'64<""<%71%?=127%76"($%%O?>?5"*<
=4<?5*""=-%61B"#"*-%1>%B64'6%<7*?7"53%<61GA=%*"'"4#"%76"%6456"<7%2*41*473$

New markets N1("% (?>?5"*<% C?#1*"=% "Z2?>=4>5% =4<7*4)G741>% )3% 12">4>5% >"B% <71*"<% 4>% A"<<
<?7G*?7"=%(?*U"7<-%"476"*%76*1G56%C1'G<"=%'1(2?>3%="#"A12(">7%1C%<2"'4C4'%(?*U"7<%1*%76*1G56%76"
G<"%1C%?*"?%C*?>'64<4>5$%%P*"?%C*?>'64<4>5%'1GA=%7?U"%7B1%C1*(<Q%%<G)C*?>'64<4>5TB6"*"%76"%(?<7"*
C*?>'64<""% 2G*'6?<"=% 76"% "Z'AG<4#"% *4567<% 71% <G)C*?>'64<"% 71% 4>=4#4=G?A% 1B>"*% 12"*?71*<% 4>% ?
2?*74'GA?*% 7"**471*3-% 1*% "Z'AG<4#"% ="#"A12(">7% C*?>'64<4>5TB6"*"% 76"% C*?>'64<""% 2G*'6?<"=% 76"
"Z'AG<4#"%*4567<%71%?%7"**471*3%?>=%?5*""=%71%12">%?>=%12"*?7"%?%<2"'4C4"=%>G()"*%1C%<612<%4>%76"%?*"?
B4764>%?%<2"'4C4"=%74("%2"*41=$%%Y>%<G)C*?>'64<4>5-%76"%C*?>'64<""<%2?4=%?%(?<7"*%C*?>'64<""%?%*13?A73
2"*'">7?5"% 1C% <?A"<-% ?>=% 76"% (?<7"*% C*?>'64<""-% 4>% 7G*>-% 2?4=% ?% *13?A73% 71% 76"% C*?>'64<1*$% % ^>A4U"
"Z'AG<4#"% ="#"A12(">7% C*?>'64<4>5-% 76"*"C1*"-% <G)C*?>'64<4>5% ?=="=% ?>176"*% A?3"*% )"7B"">% 76"
C*?>'64<1*%?>=%76"%12"*?74>5%C*?>'64<""$%%E6"%(?<7"*%C*?>'64<""%7324'?AA3%?<<G("=%?AA%1*%(1<7%1C%76"
=G74"<% 1C% 76"% C*?>'64<1*% 4>% 47<% 7"**471*3$% % eZ'AG<4#"% ="#"A12(">7% C*?>'64<4>5% *"7?4>"=% 76"% =4*"'7
'1>>"'741>% )"7B"">% 12"*?74>5% C*?>'64<""% ?>=% 76"% C*?>'64<1*-% )G7% B6">% 76"% ?*"?<% B"*"% A?*5"-% 76"
4>=4#4=G?A%<612<%*"<"()A"=%'1(2?>3H1B>"=%<612<%4>%76?7%76"3%B"*"%12"*?7"=%)3%<?A?*4"=%(?>?5"*<
4><7"?=% 1C% 76"% C*?>'64<""<% 76"(<"A#"<$% % M176% 732"<% 1C% ?*"?% C*?>'64<4>5% ?AA1B"=% 76"% C*?>'64<1*% 71
"Z2?>=%FG4'UA3%4>71%>"B%(?*U"7<$%%PA<1-%?*"?%C*?>'64<4>5%=4=%>17%*"FG4*"%76"%'1(2?>3%71%4>#"<7%4>%76"
="#"A12(">7%1C%76"%2*12"*74"<$

&G>U4>V%&1>G7<%6?=%7*4"=%"Z'AG<4#"%="#"A12(">7%C*?>'64<4>5%4>%!"541>%YY%<"#"*?A%74("<-%)G7
6?=%>"#"*%)"">%<G''"<<CGA$%%@1*%"Z?(2A"-%4>%+9K:%76"%*4567<%71%="#"A12%?AA%1C%N?>%&4"51%B"*"%<1A=%71
76*""%)*176"*<%B61%1B>"=%?%A?*5"%'6?4>%1C%CG*>47G*"%<71*"<%_?<%A?*5"%?<%&G>U4>V%&1>G7<%47<"AC`$%%E6"
C*?>'64<""<%12">"=%<4Z%<71*"<$%%d>A3%1>"%B?<%4>%?%A1'?741>%?22*1#"=%)3%&G>U4>V%&1>G7<-%?>=%47%B?<
76"% 1>A3% 1>"% "#"*% 71% *"?'6% )*"?U"#">$% % E6"% 176"*% <71*"<% "Z2"*4">'"=% "Z7*"("A3% 6456% 7G*>1#"*% 1C
"(2A13""<% ?>=% '1><4<7">7A3% A1<7% (1>"3$% % E6"% "Z'AG<4#"% ="#"A12(">7% ?5*""(">7% "#">7G?AA3% B?<
7"*(4>?7"=-%?>=%76"%4>=4#4=G?A%<71*"<%_>17%76"%7"**471*3`%B"*"%<1A=%71%?>176"*%C*?>'64<""%B61%=1G)A"=
76"4*%<?A"<$

@1'G<"=%<"FG">74?A%="#"A12(">7%1C%>"B%1*%G>="*="#"A12"=%(?*U"7<%B?<%?>176"*%?A7"*>?74#"$
^>="*% 76?7% <7*?7"53-% &G>U4>V% &1>G7<% B1GA=% ">7"*% >"B% 1*% 'G**">7A3% G>="*="#"A12"=% (?*U"7<
<"FG">74?AA3-%12">4>5%?<%(?>3%>"B%<71*"<%4>%"?'6%(?*U"7%?<%B?<%>"'"<<?*3%71%?'64"#"%"'1>1(4"<%1C
<'?A"%4>%(?*U"74>5%?>=%12"*?741><%)"C1*"%(1#4>5%1>%71%76"%>"Z7%(?*U"7$%%E64<%?22*1?'6%B1GA=%?#14=
76"%6?26?b?*=%="#"A12(">7%'G**">7A3%'6?*?'7"*4<74'%1C%!"541>%YY-%B64A"%2*1#4=4>5%C1*%"CC4'4">7%5*1B76
4>% 76"% A"<<H<?7G*?7"=% (?*U"7<$% % D1B"#"*-% 47% B?<% A4U"A3% 76?7% <G'6% ?% <7*?7"53% B1GA=% *"FG4*"% &G>U4>V
&1>G7<%71%7?U"%?>%?'74#"%*1A"%4>%76"%="#"A12(">7%1C%76"%*"?A%"<7?7"%C1*%76"%#?*41G<%<47"<$%%E6"*"%B"*"
<1("% B61% C?#1*"=% >17% 1>A3% '1>74>G"=% '1(2?>3% <47"% ="#"A12(">7-% )G7% ?A<1% *"#47?A4b?741>% 1C% 76"
01(2?>3%d2"*?7"=%N71*"%&4#4<41>$

9
This document is authorized for use only in Prof. D K Batra's PGDM-II/ Sales & Distribution Management- at International Management Institute - New Delhi (IMI) from Jun 2020 to Oct 2020.
 589-017 Dunkin' Donuts (E): 1988 Distribution Strategies

Branded products P>176"*%?22*1?'6%B1GA=%)"%71%"Z2?>=%76"%=4<7*4)G741>%1C%"Z4<74>5%<71*"<$%%N1("

(?>?5"*<%2*121<"=%76?7%&G>U4>V%&1>G7<%'1>7*?'7%B476%'1>#">4">'"%<71*"%'6?4><%71%<G22A3%)*?>="=
2*1=G'7<%71%2?*74'42?74>5%1G7A"7<$%%Y7%B?<%"Z2"'7"=%76?7%?%A1'?A%C*?>'64<""%'1GA=%="A4#"*%C*"<6%&G>U4>V
&1>G7<V% 2*1=G'7<% 7B4'"% =?4A3% 71% )"7B"">% +/% ?>=% +I% '1>#">4">'"% <71*"<$% E6"% 2*1=G'7<% B1GA=% )"
=4<2A?3"=% 4>% 4AAG(4>?7"=% &G>U4>V% &1>G7<% <"ACH<"*#"% =4<2A?3% '?<"<$% % Y7% B?<% "<74(?7"=% 76?7% ?% 7324'?A
)*?>="=%2*1=G'7%*1G7"%B1GA=%4>#1A#"%?>%?==4741>?A%4>#"<7(">7%)3%76"%C*?>'64<""%1C%h+9-///%C1*%'?<"<
?>=% 176"*% "FG42(">7% _G<G?AA3% C4>?>'"=% )3% ?% C4#"H3"?*% >17"`$% % Y7% B?<% ?<<G("=% 76?7% 76"% C*?>'64<""<
B1GA=%A"?<"%76"%="A4#"*3%#"64'A"<-%?>=%76"*"%B1GA=%)"%>1%?==4741>?A%C*?>'64<"%C""$

&G>U4>V% &1>G7<% (?>?5"(">7% U>"B% 76?7% 76"% )*?>="=% 2*1=G'7<% <7*?7"53% '1GA=% '?G<"
?==4741>?A% C*4'741>% )"7B"">% C*?>'64<""<% 4>% 76"% (1*"% <?7G*?7"=% (?*U"7<% G>A"<<% <1("% <3<7"(% B?<
="<45>"=%71%?AA1'?7"%<2"'4C4'%'1>#">4">'"%'6?4>%1G7A"7<%71%"?'6%2?*74'42?74>5%C*?>'64<""$%%E6"%FG"<741>
*"(?4>"=% ?<% 71% B6"76"*% 71% 2*17"'7% >1>2?*74'42?74>5% C*?>'64<""<% C*1(% 6?#4>5% 76"% '1>#">4">'"% <71*"
>"Z7% =11*% <"AA4>5% ?>176"*% C*?>'64<""V<% )*?>="=% &G>U4>V% &1>G7<$% % \G?A473% '1>7*1A% ?A<1% B1GA=% )"% ?
<45>4C4'?>7% 2*1)A"($% % Y7% B1GA=% )"% >"'"<<?*3% C1*% 76"% <G22A34>5% C*?>'64<""% 71% '?*"CGAA3% (1>471*% 76"
'1>#">4">'"% <71*"<% ?>=% "><G*"% 76?7% 2*1=G'7<% B64'6% 6?=% 2?<<"=% 76"4*% C*"<6>"<<% A4(47% B"*"% *"(1#"=
?>=%=4<'?*="=$%%01>#">4">'"%<71*"<%B"*"%A4U"A3%71%B?>7%76"%2*1=G'7<%"?*A3%4>%76"%(1*>4>5-%76"%<?("
74("%76"%<612<%>""="=%71%)"%CGAA3%<71'U"=$%%E6"*"%B?<%?A<1%?%FG"<741>%?<%71%B64'6%2*1=G'7<%B1GA=%)"
(?="%?#?4A?)A"%G>="*%764<%2*15*?($

@*?>'64<""<%B61%B"*"%?A*"?=3%<G22A34>5%76"%A1'?A%'1>#">4">'"%<71*"<%1>%?>%4>=4#4=G?A%)?<4<
B476%G>)*?>="=%2*1=G'7<%=4=%>17%<""%76"%)">"C47%71%76"(%1C%<B47'64>5%71%)*?>="=%2*1=G'7<$%%O?*54><
B"*"%>17%"Z2"'7"=%71%4(2*1#"-%?>=%G>A4U"%76"%'G**">7%?**?>5"(">7<-%76"% C*?>'64<""<% B1GA=% 6?#"% 71
="A4#"*%76"%2*1=G'7<%71%76"%'1>#">4">'"%<71*"<$%%d76"*%C*?>'64<""<%=4=%>17%A4U"%76"%4="?%1C%W'1(2"74>5
B476%76"(<"A#"<$X%%01(2?>3%(?>?5"*<%)"A4"#"=%76?7%76"%'1>#">4">'"%<71*"%=1G56>G7%'G<71("*%B?<
=4CC"*">7%C*1(%76"%=1G56>G7% <612%'G<71("*-%)G7%C1G>=%47% 6?*=%71%'1>#4>'"% <1("%C*?>'64<""<% 1C%76?7
C?'7$

P>176"*% 21<<4)4A473% B?<% C1*% 76"% '1(2?>3% 71% <G22A3% 76"% '1>#">4">'"% <71*"<% 4>% "?'6% (?*U"7
C*1(%?%A1'?A%'">7*?A%'1((4<<?*3$%%E6"%'1((4<<?*3%B1GA=%)"%C1*%2*1=G'741>%1>A3%?>=%B1GA=%>17%<"AA
71%*"7?4A%'G<71("*<$%%E6"*"C1*"-%47%'1GA=%)"%2A?'"=%4>%?%*"A?74#"A3%4>"Z2"><4#"%'">7*?A%A1'?741>%B4761G7
'1>'"*>%C1*%47<%?)4A473%71%?77*?'7%*"7?4A%'G<71("*<$

Exhibit 3%2*"<">7<%?%2*1%C1*(?%4>'1("%<7?7"(">7%C1*%?%632176"74'?A%)*?>="=%2*1=G'7<%*1G7"
4>% 76"% S1*76"?<7% ?>=% *"CA"'7"=% 76"% 'G**">7% <?A"<% ?>=% '1<7% "<74(?7"<% 1C% 76"% &G>U4>V% &1>G7<
&"#"A12(">7%f*1G2$

Satellites &G>U4>V% &1>G7<% (?>?5"(">7% )"A4"#"=% 76?7% 4>% (?>3% 12"*?74>5% (?*U"7<% 76"*"% B"*"
W<"?(<X%1C%'1><G("*%="(?>=%B64'6%"Z4<7"=%)"7B"">%76"%CGAAH2*1=G'4>5%<612<%)G7%B64'6%'1GA=%>17
<G221*7% ?>% ?==4741>?A% 2*1=G'4>5% G>47$% % E1% 2*""(27% '1(2"74741>% C*1(% 5?4>4>5% ?% 71"61A=% 4>% 761<"
A1'?741><-%1>"%12741>%B?<%76"%G<"%1C%<?7"AA47"%1G7A"7<$%%N?7"AA47"<%B"*"%>1>2*1=G'4>5%G>47<%B64'6%B"*"
<"*#4'"=% C*1(% >"?*)3% CGAAH2*1=G'4>5% G>47<$% % E6"3% '1GA=% 7?U"% 76"% C1*(% 1C% ?% <71*"C*1>7-% ?% <7?AA% 4>% ?
<61224>5%(?AA-%1*%"#">%?%'?*7%4>%?%7*?4>%<7?741>$

01(2?>3%(?>?5"*<%B"*"%'1>#4>'"=%76?7%?%511=%)G<4>"<<%'?<"%'1GA=%)"%(?="%C1*%4>#"<74>5%4>
76"%>1>2*1=G'4>5%G>47<$%%PA761G56%76"*"%B?<%B4="%>?741>?A%#?*4?>'"%4>%*"?A%"<7?7"%'1<7<-%C1*%2G*21<"<
1C%'1(2?*4<1>%76"%'1(2?>3V<%&"#"A12(">7%f*1G2%'1(24A"=%<1("%<'">?*41<%B64'6%'1(2?*"=%76"%2*1
C1*(?%12"*?74>5%*"<GA7<%C1*%?%7324'?A%CGAAH2*1=G'4>5%G>47%4>%76"% S1*76"?<7% 71% 761<"% 1C% ?% 632176"74'?A
<?7"AA47"% >"7B1*U% _<"" Exhibit 4`$% % @GAAH2*1=G'4>5% G>47<% 7324'?AA3% *"FG4*"=% ?>% 4>#"<7(">7% 1C% ?)1G7
hJII-///% C1*% 76"% A?>=-% <47"% 4(2*1#"(">7-% ?>=% )G4A=4>5-% 2AG<% h++I-///% C1*% 76"% 1#"><% ?>=% 176"*
"FG42(">7$% % N?7"AA47"% <47"<% B"*"% 5">"*?AA3% A"?<"=-% )G7% C1*% 2G*21<"<% 1C% '1(2?*4<1>% 76"% '1(2?>3
?<<G("=% 76?7% ?>% ://H<FG?*"HC117% <?7"AA47"% B476% <1("% <"?74>5% ?>=% C4>4<64>5% '?2?'473% B1GA=% *"FG4*"
h./-///% C1*% 76"% A"?<"% 61A=% 4(2*1#"(">7<-% ?>=% h:/-///% C1*% '?247?A4b"=% A?>=% ?>=% )G4A=4>5% '1<7<$% % E6"
<?7"AA47"V<%"FG42(">7%B1GA=%'1<7%?>%?==4741>?A%hII-///$%%&"#"A12(">7%f*1G2%(?>?5"*<%"<74(?7"=%76"
?#"*?5"%B""UA3%<?A"<%1C%?%<?7"AA47"%71%)"%hL-+//$

10
This document is authorized for use only in Prof. D K Batra's PGDM-II/ Sales & Distribution Management- at International Management Institute - New Delhi (IMI) from Jun 2020 to Oct 2020.
 Dunkin' Donuts (E): 1988 Distribution Strategies 589-017

PA761G56%<6*4>U%B?<%"Z2"'7"=%71%)"%5*"?7"*%?7%76"%<?7"AA47"%G>47-%C11=%'1<7<%?<%?%2"*'">7?5"%1C
<?A"<% B"*"% "Z2"'7"=% 71% )"% 76"% <?("% ?<% C1*% 76"% 2*1=G'4>5% G>47% )"'?G<"% ?% 5*"?7"*% 2*121*741>% 1C% 76"
=1G56>G7<%B1GA=%)"%<1A=%?<%<4>5A"<$%%N4(4A?*A3-%76"%2?3*1AA%'1<7<%?<%?%2"*'">7%1C%<?A"<%B"*"%"Z2"'7"=
71%)"%?22*1Z4(?7"A3%76"%<?("%C1*%<?7"AA47"<%?<%C1*%76"%2*1=G'4>5%G>47<$%%PA761G56%76"%<?7"AA47"<%B1GA=
)"%'6?*5"=%B476%76"%?==4741>?A%2?3*1AA%"Z2"><"%1C%?%="A4#"*3%2"*<1>-%76"%)?U"*V<%2?3*1AA%"Z2"><"%C1*
76"%<?7"AA47"%B?<%A1B"*%)"'?G<"%47%B?<%7?U">%?<%?>%4>'*"(">7?A%'1<7%1#"*%?>=%?)1#"%76"%*"5GA?*%)?U4>5
"Z2"><"%C1*%76"%2*1=G'4>5%G>47$

PA761G56%'11*=4>?741>%B1GA=%)"%=4CC4'GA7-%4C%76"<"%G>47<%'1GA=%)"%<G22A4"=%C*1(%?%<612%B476
"Z'"<<% '?2?'473-% &G>U4>V% &1>G7<V% (?>?5"(">7% )"A4"#"=% 76?7% 76"% C*?>'64<""% <61GA=% )"% ?)A"% 71
<G)<7?>74?AA3% 4>'*"?<"% 64<% 1*% 6"*% 2*1C47<$% % Y>% 76"% <7*1>5% &G>U4>V% &1>G7<% (?*U"7<-% 61B"#"*-% <1("
C*?>'64<""<% =4=% >17% <""% 61B% 47% B?<% 21<<4)A"% 71% <G22A3% ?% <?7"AA47"% C*1(% 76"4*% CGAAH2*1=G'4>5% <612<$
PA761G56% 76"3% 6?=% "Z'"<<% 2*1=G'741>% '?2?'473-% (?>3% B"*"% ?A*"?=3% <7*"7'6"=% 71% 76"% A4(47<% B476
*"<2"'7%71%76"4*%(?>?5"(">7%1C%76"%)G<4>"<<$

O1<7%'1(2?>3%(?>?5"*<%761G567%76?7%4>% 1*="*%71%1)7?4>%76"% 1274(?A%(4Z% 1C%2*1=G'4>5%?>=

>1>2*1=G'4>5% G>47<-% 47% B1GA=% )"% >"'"<<?*3% 71% <"AA% "Z'AG<4#"% (4'*1H7"**471*4"<% 71% FG?A4C4"=% "Z4<74>5
C*?>'64<""<$%%^>="*%764<%2A?>-%76"%'1(2?>3%B1GA=%?<<"<<%61B%(?>3%?>=%B6?7%732"%_CGAAH2*1=G'4>5-
<?7"AA47"<-% '?*7<`% 1C% 1G7A"7<% B1GA=% )"% 1274(?A% C1*% 76"% (4'*1H7"**471*3% <G**1G>=4>5% ?% 2?*74'GA?*
C*?>'64<""% _7324'?AA3% +H.% 2*1=G'4>5% <612<% ?>=% +H,% <?7"AA47"<`$% % E6"% C*?>'64<""% B1GA=% )"% 1CC"*"=% 76"
"Z'AG<4#"%*4567<%71%76"%7"**471*3%4>%*"7G*>%C1*%?%2*"2?4=%C""%"FG?A%71%76"%'G(GA?74#"%C*?>'64<"%C""<%C1*
76?7% '1()4>?741>% 1C% 1G7A"7<$% % _Y>% !"541>% Y-% CGAAH2*1=G'4>5% G>47% C""<% B"*"% h.K-///% ?>=% >1>2*1=G'4>5
G>47<%B"*"%h+/-///i%4>%!"541>%YY-%76"3%B"*"%h./-///%?>=%hK-I//`$%%E6"%C*?>'64<""%B1GA=%?5*""%71%C4>=
76"%<2"'4C4'%<47"<%?>=%="#"A12%76"%<2"'4C4"=%1G7A"7<%B4764>%?%C4#"H3"?*%74("%2"*41=$%%YC%76"%<612<%B"*"
>17%12">"=%?''1*=4>5%71%<'6"=GA"-%76"%C*?>'64<""%'1GA=%A1<"%76"%7"**471*3%?>=%C1*C"47%76"%C""<$

&G>U4>V% &1>G7<% (?>?5"(">7% )"A4"#"=% 76?7% "Z'AG<4#"% 7"**471*4"<% B1GA=% ?22"?A% 71% )176% 76"
5*""=% ?>=% C"?*% C?'71*<$% % E6"% (1*"% ?55*"<<4#"% C*?>'64<""<% #4"B"=% 47% ?<% ?% B?3% 71% 12">% (1*"% 1G7A"7<-
B64A"% (1*"% '1><"*#?74#"% C*?>'64<""<% "Z2*"<<"=% ?% )"5*G=54>5% B4AA4>5>"<<% 71% 2G*'6?<"% 7"**471*4"<
<4(2A3% 71% 2*17"'7% 76"(<"A#"<% _?7% A"?<7% 7"(21*?*4A3`% C*1(% '1(2"74741>% C*1(% 176"*% &G>U4>V% &1>G7<
C*?>'64<""<$%%N1("%C*?>'64<""<%B61%6?=%)"">%B476%76"%'1(2?>3%C1*%?%A1>5%74("%B"*"%764>U4>5%?)1G7
*"74*"(">7$%%PA761G56%7324'?AA3%76"3%=4=%>17%6?#"%76"%">"*53%1*%B4AA4>5>"<<%71%)G4A=%76"%)G<4>"<<%4>%?
>"B% <612-% 76"3% <?B% 76"% "Z'AG<4#"% 7"**471*3% ?<% ?% B?3% 71% 2*17"'7% 76"4*% "Z4<74>5% 4>#"<7(">7% G>74A% 76"3
B"*"%*"?=3%71%<"AA$

N1("% 1C% 76"% (1<7% <G''"<<CGA% C*?>'64<""<% 6?=% 4>=4#4=G?A% <612<% B476% <?A"<% 7B4'"% 76"% <3<7"(
?#"*?5"%1*%(1*"-%5">"*?74>5%<G)<7?>74?A%2*1C47<$%%eZ7*"("A3%6456%<?A"<%?>=%2*1C47<%'1GA=%)"%4>7"*2*"7"=
)3% 76"% '1(2?>3% 71% ("?>% 76?7% 76"% (?*U"7% B?<% G>="*="#"A12"=% ?>=% 76?7% *"FG"<7<% C*1(% 176"*
C*?>'64<""<%71%12">% <612<%4>% 76?7% ?*"?% <61GA=% )"% ?22*1#"=$% % PA761G56% 2G*'6?<4>5% ?% (4'*1H7"**471*3
B1GA=%2*17"'7%76"<"%2*1C47?)A"%?*"?<%C*1(%176"*%C*?>'64<""<-%12">4>5%?==4741>?A%<612<%B1GA=%("?>%?>
4>'*"?<"% 4>% 76"% C*?>'64<""V<% 4>#"<7(">7% ?>=% ?% 21<<4)A"% ="'*"?<"% 4>% 76"% <?A"<% 1C% 64<% 1*% 6"*% <G''"<<CGA
<612$% % N1("% C*?>'64<""<% *"(?4>"=% G>'1>#4>'"=% 76?7% 76"% <?7"AA47"<% B1GA=% 4>'*"?<"% 76"4*% *"7G*>% 1>
4>#"<7(">7$%%E6"%<?A"%1C%(4'*1H7"**471*4"<-%76"*"C1*"-%=4=%>17%?G71(?74'?AA3%"><G*"%76"%<(1176%12">4>5
1C%76"%2A?>>"=%?==4741>?A%<612<$

Y(2A"(">7?741>%1C%?>%"Z'AG<4#"%7"**471*3%<7*?7"53%B1GA=%)"%=4CC4'GA7%?>=% B1GA=%=4#"*7%(1<7
1C%76"%&"#"A12(">7%f*1G2V<%"CC1*7<%C*1(%176"*%2*1]"'7<$%%PA761G56%<1("%'1(2?>3%(?>?5"*<%)"A4"#"=
76?7% C1*% 76"% 2*15*?(% 71% )"% <G''"<<CGAA3% <1A=% 71% 76"% C*?>'64<""<-% ?% 6456% A"#"A% 1C% CA"Z4)4A473% (G<7% )"
"Z64)47"=i%176"*<%C"A7%76?7%47%B1GA=%)"%>"'"<<?*3%71%<7*4'7A3%">C1*'"%76"%="#"A12(">7%<'6"=GA"<$%%E64<
*?4<"=%?%>G()"*%1C%4<<G"<$%%@1*%"Z?(2A"-%B1GA=%76"%C*?>'64<""%?G71(?74'?AA3%A1<"%76"%"Z'AG<4#"%*4567<
71% 76"% 7"**471*3% 4C% 6"% 1*% <6"% =4=% >17% '1(2A3% B476% 76"% ="#"A12(">7% <'6"=GA"j% % [1GA=% 76"*"% )"% ?>3
?AA1B?>'"%C1*%*"?<1>?)A"%="A?3<%<G'6%?<%=4CC4'GA73%4>%C4>=4>5%?22*12*4?7"%<47"<%1*%4>%1)7?4>4>5%b1>4>5
2"*(47<j%%[1GA=%A?'U%1C%?#?4A?)A"%CG>=<%)"%?>%"Z'G<?)A"%="A?3j

11
This document is authorized for use only in Prof. D K Batra's PGDM-II/ Sales & Distribution Management- at International Management Institute - New Delhi (IMI) from Jun 2020 to Oct 2020.
 589-017 Dunkin' Donuts (E): 1988 Distribution Strategies

d>"%1C%76"%(1<7%<"*41G<%2*1)A"(<%C?'4>5%&G>U4>V%&1>G7<%(?>?5"(">7%B?<%76"%="#"A12(">7
1C% ?% 21A4'3% *"5?*=4>5% 76"% ="<45>% 1C% 76"% "Z'AG<4#"% ="#"A12(">7% (4'*1H7"**471*4"<$% % D1B% )45% <61GA=
7"**471*4"<% )"j% % N61GA=% 76"3% *"FG4*"% (1*"% 76?>% 1>"% 1*% 7B1% ?==4741>?A% <612<j% % N61GA=% 7"**471*4"<% )"
="<45>"=%B4761G7%*"5?*=%71%"Z4<74>5%C*?>'64<""<V%="<4*"<%71%2G*'6?<"%76"(j%%[6?7%'*47"*4?%<61GA=%)"
G<"=% 71% ="7"*(4>"% B6"76"*% 71% 2"*(47% ?% C*?>'64<""% 71% )G3% ?% 7"**471*3j% % YC% 76"% C*?>'64<""% 4<% >17
12"*?741>?AA3%1*%C4>?>'4?AA3%FG?A4C4"=%71%2G*'6?<"%?%7"**471*3%1*%4<%>17%4>7"*"<7"=%4>%)G34>5-%<61GA=%76"
7"**471*3%?*1G>=%64<%1*%6"*%<612%)"%6"A=%12">%1*%<1A=%71%?>176"*%C*?>'64<""j%%P%2?*74'GA?*A3%=4CC4'GA7
4<<G"% 4>#1A#"=% 761<"% (?*U"7<% B6"*"% 76"*"% 6?=% ?A*"?=3% )"">% <45>4C4'?>7% ="#"A12(">7$% % N61GA=
7"**471*4"<% )"% ="C4>"=% <1% ?<% 71% 4>'AG="% (1*"% 76?>% 1>"% C*?>'64<""V<% "Z4<74>5% <612-% 1*% <61GA=% <1("
(?*U"7<%)"%4((G>"%C*1(%"Z'AG<4#"%7"**471*3%="#"A12(">7j

Current Situation

E1(%N'6B?*b-%2*"<4=">7%1C%&G>U4>V%&1>G7<-%'1((">7"=%1>%76"%%'G**">7%<47G?741>Q

Y7V<%1G*%]1)%71%">6?>'"%<6?*"61A="*%#?AG"$%%E6?7%="2">=<%1>%61B%B"AA%B"%G<"
1G*%'?247?A-%)176%6G(?>%?>=%C4>?>'4?A-%?>=%5*1B%76"%'1(2?>3$%%["V*"%4>%5*"?7%<6?2"-
)G7%B"%6?#"%71%'1>74>G"%71%<?74<C3%1G*%'G<71("*<-%?>=%71%=1%<1%B"%6?#"%71%(?U"%<G*"
1G*%C*?>'64<""<%?*"%<G''"<<CGA$%%!"'">7A3-%76"%C*?>'64<""<%6?#">V7%)"">%?<%2*1C47?)A"%?<
B"V=%A4U"-%?>=%4C%76"3%?*">V7%2*1C47?)A"-%76"3%B1>V7% 4>#"<7% 4>%76"4*%<612<%71%(?4>7?4>
<7?>=?*=<%1*%4>7*1=G'"%>"B%2*1=G'7<$%%["%U>1B%B"V*"%>17%514>5%71%5"7%2"12A"%71%"?7
?% A17% (1*"% =1G56>G7<-% )G7% )3% 4>'*"?<4>5% 1G*% =4<7*4)G741>% B"% '?>% 5"7% ?% A17% (1*"
2"12A"%71%"?7%1G*%=1G56>G7<$%%["V#"%517%<1("%B1*U%71%=1$

12
This document is authorized for use only in Prof. D K Batra's PGDM-II/ Sales & Distribution Management- at International Management Institute - New Delhi (IMI) from Jun 2020 to Oct 2020.
 589-017 -13-

Exhibit 1 01(21<47"%;*1C47%?>=%c1<<%N7?7"(">7%C1*%Y>=4#4=G?A%N612<%_P2*4A%+9::-%*"21*7"=%?#"*?5"<%)3%*"541>`

Franchisee-Operated Company-Operated
Region I Region II
Northeast Southeast Central Western Northeast

Sales (Annual) 530,387 435,791 392,215 354,868 597,187

Cost of Sales
Food Cost 121,989 109,334 100,810 93,744 157,527
Payroll 134,187 104,474 92,571 87,973 142,640
Supplies 24,928 15,847 16,541 13,323 26,776
Total Cost of Sales 281,104 229,655 209,922 195,030 326,943
Operating Expenses
Weekly Franchise Fee 25,989 20,627 19,298 17,202 0
Advertising Contribution 26,519 20,903 19,619 18,452 27,057
Payroll Taxes 14,320 10,743 10,721 8,737 19,791
Other Operating Expenses (1) 30,763 26,207 20,857 18,385 37,952
Total Operating Expenses 97,591 78,480 70,495 62,776 84,800
Occupancy and Financing Expenses
Rent and Real Estate Taxes 50,988 45,398 41,311 34,514 38,508
Utilities 17,366 18,116 14,938 13,485 24,740
Insurance 6,223 6,745 4,382 4,861 10,019
Interest 10,073 9,188 6,150 6,307 9,519
Total Occupancy and Financing Expenses 84,650 79,447 66,781 59,167 82,786
Total Depreciation and Amortization 19,327 19,439 15,033 14,211 14,640
Net Operating Profit/Loss Before Owner's Draw and
Income Taxes 47,715 28,770 29,984 23,684 88,018
Addbacks: Total Depreciation and Amortization 19,327 19,439 15,033 14,211 14,640
Rent 45,889 40,858 37,180 31,063 34,657
Interest 10,073 9,188 6,150 6,307 9,519
Adjusted Cash Flow 123,004 98,255 88,347 75,265 146,834
(1) Other Operating Expenses Include:
Professional Services 4,243 3,600 2,700 2,526 483
Municipal Taxes and Related Charges 1,061 1,935 1,948 2,395 205
Travel and Freight 530 1,982 746 1,015 908
Cleaning, Maintenance and Repairs 17,503 12,394 10,113 8,631 29,247
Administrative and Office Expenses 3,713 3,279 3,118 2,556 2,847
Other Expenses 3,713 3,017 2,232 1,256 4,262

Total Other Operating Expenses 30,763 26,207 20,857 18,379 37,952

This document is authorized for use only in Prof. D K Batra's PGDM-II/ Sales & Distribution Management- at International Management Institute - New Delhi (IMI) from Jun 2020 to Oct 2020.
 589-017 Dunkin' Donuts (E): 1988 Distribution Strategies

Exhibit 2 01>7*4)G741>%71%01*21*?7"%Y>'1("%)3%&4#4<41>

October 31, 1987 October 25, 1986

Franchise Division (does not include International Licenses)

Revenues
Rental income $37,780,000 $35,356,000
Continuing franchise fee income 32,126,000 28,829,000
Sales by temporarily operated shops 1,025,000 2,141,000
Othera 6,664,000 4,458,000
77,595,000 70,784,000
Expenses
Expenses related to rental properties 18,218,000 16,324,000
Expenses related to temporarily operated shops 1,092,000 2,292,000
Selling, general and administrative expenses directly related
to Franchise Division 14,738,000 11,217,000
34,048,000 29,833,000
Contribution to income before taxes and prior to corporate
selling, general and administrative expenses $43,547,000 $40,951,000

Number of Shops 1,449 1,353

Company-Operated Shops Division

Revenues
Sales $17,042,000 $27,453,000
Otherb 3,583,000 2,978,000
20,625,000 30,431,000

Operating costs and expenses 15,774,000 25,996,000

Gross profit from operations 4,851,000 4,435,000

Selling, general and administrative expenses directly related
to Company-operated Shops Division 1,157,000 1,823,000

Contribution to income before income taxes and prior to

corporate selling, general and administrative expenses $3,694,000 $2,612,000

Number of Shops 29 44

aIncludes initial franchise fees and sales of real estate and temporarily operated shops.
bIncludes sales of company-operated shops.

14
This document is authorized for use only in Prof. D K Batra's PGDM-II/ Sales & Distribution Management- at International Management Institute - New Delhi (IMI) from Jun 2020 to Oct 2020.
 Dunkin' Donuts (E): 1988 Distribution Strategies 589-017

Exhibit 3 ;*1%@1*(?%C1*%M*?>="=%;*1=G'7%d2"*?741><%4>%S1*76"?<7%!"541>

Branded Combination
Full-Producing Unit Product Route Network

Sales 530,387 140,110 670,497

Cost of Sales
Food Cost 121,989 (23.0%) 30,124 (21.5%) 152,113 (22.7%)
Payroll—Production 49,326 (9.3%) 23,819 (17.0%) 73,145 (10.9%)
Payroll—Sales 80,088 (15.1%) --- (0.0%) 80,088 (11.9%)
Payroll—Maintenance 4,773 (.9%) 5,044 (3.6%) 9,817 (1.5%)
Payroll—Delivery --- (0.0%) 14,291 (10.2%) 14,291 (2.1%)
Suppliers 24,928 (4.7%) --- (0.0%) 24,928 (3.7%)
Total Cost of Sales 281,104 (53.0%) 73,278 (52.3%) 354,382 (52.9%)

Operating Expenses
Weekly Franchise Fee 25,989 (4.9%) 9,808 (7.0%) 35,797 (5.3%)
Advertising Contribution 26,519 (5.0%) 7,006 (5.0%) 33,525 (5.0%)
Payroll Taxes 14,320 (2.7%) 5,044 (3.6%) 19,364 (2.9%)
Professional Services 4,243 (.8%) --- (0.0%) 4,243 (.6%)
Other Taxes (Not Real Estate) 1,061 (.2%) 140 (.1%) 1,201 (.2%)
Travel, Freight 530 (.1%) --- (0.0%) 530 (.1%)
Cleaning, Maintenance, Repair 17,503 (3.3%) 420 (.3%) 17,923 (2.7%)
Administrative and Office Expenses 3,713 (.7%) 1,121 (.8%) 4,834 (.7%)
Other Expense 3,713 (.7%) 1,261 (.9%) 4,974 (.7%)
Delivery Cost --- (0.0%) 10,500 (7.5%) 10,500 (1.6%)
Total Operating Expense 97,591 (18.4%) 35,300 (25.2%) 132,891 (19.8%)

Occupancy and Financing Expenses

Rent and Real Estate Taxes 50,988 (9.6%) --- (0.0%) 50,988 (7.6%)
Utilities 17,366 (3.3%) 1,121 (.8%) 18,487 (2.8%)
Insurance 6,223 (1.2%) 2,662 (1.9%) 8,885 (1.3%)
Interest 10,073 (1.9%) 5,200 (3.7%) 15,273 (2.3%)
Total Occupancy/Financial Expenses 84,650 (16.0%) 8,983 (6.4%) 93,633 (14.0%)

Total Depreciation and Amortization 19,327 (3.6%) --- (0.0%) 19,327 (2.9%)

Profit before Owner's Draw and

Income Taxes 47,715 (9.0%) 22,549 (16.1%) 70,264 (10.5%)
-- ADJUSTMENTS --
Addbacks
Depreciation and Amortization 19,327 (3.6%) --- (0.0%) 19,327 (2.9%)
Interest 10,073 (1.9%) 5,200 (3.7%) 15,273 (2.3%)
Rent 45,889 (8.7%) --- (0.0%) 45,889 (8.7%)

Adjusted Cash Flow before Owner's

Draw and Income Taxes 123,004 (23.2%) 27,749 (19.8%) 150,753 (22.5%)

15
This document is authorized for use only in Prof. D K Batra's PGDM-II/ Sales & Distribution Management- at International Management Institute - New Delhi (IMI) from Jun 2020 to Oct 2020.
 589-017 Dunkin' Donuts (E): 1988 Distribution Strategies

Exhibit 4 ;*1%@1*(?%C1*%N?7"AA47"%d2"*?741><%4>%S1*76"?<7%!"541>%_d>"%N?7"AA47"`

Full-Producing Unit Satellite Unit Combination Network

Sales 530,387 319,185 849,572

Cost of Sales
Food Cost 121,989 (23.0%) 73,413 (23.0%) 195,402 (23.0%)
Payroll—Production 49,326 (9.3%) 20,109 (6.3%) 69,435 (8.2%)
Payroll—Sales 80,088 (15.1%) 51,389 (16.1%) 131,477 (15.5%)
Payroll—Maintenance 4,773 (.9%) 1,596 (.5%) 6,369 (.8%)
Payroll—Delivery --- (0.0%) 7,980 (2.5%) 7,980 (.9%)
Suppliers 24,928 (4.7%) 15,002 (4.7%) 39,930 (4.7%)
Total Cost of Sales 281,104 (53.0%) 169,489 (53.0%) 450,593 (53.0%)

Operating Expenses
Weekly Franchise Fee 25,989 (4.9%) 15,640 (4.9%) 41,629 (4.9%)
Advertising Contribution 26,519 (5.0%) 15,959 (5.0%) 42,478 (5.0%)
Payroll Taxes 14,320 (2.7%) 9,256 (2.9%) 23,576 (2.8%)
Professional Services 4,243 (.8%) 1,277 (.4%) 5,520 (.7%)
Other Taxes (Not Real Estate) 1,061 (.2%) 319 (.1%) 1,380 (.2%)
Travel, Freight 530 (.1%) --- (0.0%) 530 (.1%)
Cleaning, Maintenance, Repair 17,503 (3.3%) 4,149 (1.3%) 21,652 (2.5%)
Administrative and Office Expenses 3,713 (.7%) 638 (.2%) 4,351 (.5%)
Other Expense 3,713 (.7%) 1,915 (.6%) 5,628 (.7%)
Delivery Cost --- (0.0%) 10,500 (3.3%) 10,500 (1.2%)
Total Operating Expense 97,591 (18.4%) 59,653 (18.7%) 157,244 (18.5%)

Occupancy and Financing Expenses

Rent and Real Estate Taxes 50,988 (9.6%) 27,075 (8.5%) 78,063 (9.2%)
Utilities 17,366 (3.3%) 6,078 (1.9%) 23,444 (2.8%)
Insurance 6,223 (1.2%) 4,408 (1.3%) 10,271 (1.2%)
Interest 10,073 (1.9%) 9,403 (2.9%) 19,476 (2.3%)
Total Occupancy/Financial Expenses 84,650 (16.0%) 46,604 (14.6%) 131,254 (15.4%)

Total Depreciation and Amortization 19,327 (3.6%) --- (0.0%) 19,327 (2.3%)

Profit before Owner's Draw and

Income Taxes 47,715 (9.0%) 43,439 (13.6%) 91,154 (10.7%)
-- ADJUSTMENTS --
Addbacks
Depreciation and Amortization 19,327 (3.6%) --- (0.0%) 19,327 (2.3%)
Interest 10,073 (1.9%) 9,403 (3.7%) 19,476 (2.3%)
Rent 45,889 (8.7%) 24,368 (7.6%) 70,257 (8.3%)
Adjusted Cash Flow before Owner's
Draw and Income Taxes 123,004 (23.2%) 77,210 (24.2%) 200,214 (23.6%)

16
This document is authorized for use only in Prof. D K Batra's PGDM-II/ Sales & Distribution Management- at International Management Institute - New Delhi (IMI) from Jun 2020 to Oct 2020.