Dunkin’ to Close Up to 800 U.S. Locations, Joining a Growing List of Chains Making Cuts This Year
Most of the closures are “off-strategy” stores, including over 450 Speedway locations already slated to shut.
America runs on Dunkin’—but at a time when America’s GDP dropped at nearly 33 percent due to the coronavirus pandemic, apparently, America doesn’t need as many Dunkin’s to keep running. Yesterday, the company announced plans to shutter as many as 800 locations in the United States.
During the company’s earnings call, Chief Financial Officer Kate Jaspon explained, “With the temporary closures that we had during the COVID crisis, we took the opportunity to accelerate our discussions with our franchisees” about possible permanent closures. Earlier in the year, Dunkin’ had announced plans to close 450 locations located in Speedway convenience stores, but including those closures, Jaspon added, “We believe there could be approximately 800 low volume locations, primarily alternative points of distribution that may permanently close. If all 800 of these locations were to close, they would represent 8 percentage of the Dunkin' U.S. total restaurant footprint, but only around 2 percentage of system-wide sales.”
Dunkin’ is far from the only major chain that has taken this opportunity to re-evaluate its store portfolio. Earlier this week, McDonald’s announced plans to close about 200 U.S. locations—though, similar to Dunkin’, a good chunk of them won’t be standalone stores: Over half are McDonald’s located in Walmarts. And last month, Starbucks announced plans to close up to 400 of its company-owned stores in the U.S. over the next year and a half; though, in that instance, Starbucks also said it was moving ahead with opening 300 locations as well—calling the mix of closures and openings a shift towards more to-go oriented locations.
But that’s just the tip of the iceberg: Other quick-service chains that have announced permanent closures during the pandemic include Pizza Hut, Steak ‘n Shake, and—also revealed this week—Pret A Manger.
In Dunkin’s case, CEO and President Dave Hoffman described the shuttering locations as simply “low volume-driven, off-strategy” stores where the company was choosing “quality over quantity.” He explained, “In terms of a good scrubbing of the portfolio and being opportunistic during this time period, we felt like this was the right move.”