By Derek Gale, Senior Editor — Hotels, 5/28/2009 1:35:00 PM
Dunkin’ Donuts has expanded its brand presence into the lodging market with the opening of the company’s first hotel restaurant location at the Great Wolf Lodge in Concord, North Carolina.
Now it will look to continue that expansion at large airport hotels, resorts and vacation ownership properties (think 350 rooms or more) throughout the Eastern, Midwestern and Southwestern United States.
HOTELS took a few minutes to talk with Chris Burr, Dunkin’s director of nontraditional development and a 20-year veteran of the lodging industry, about the company’s development efforts within the hotel/resort segment.
HOTELS: How does your background as a director of franchise sales and a brand director with Choice Hotels International inform your efforts to help Dunkin’ Donuts expand into the lodging market?
Burr: I’ve had a considerable number of years in the hotel business, from college right up to when I left Choice in 2002, and it gives me [perspective] both from an operations side and from a branding and franchising side. I operated franchised hotels as a director of operations for a management company, I have sold franchises, and I was brand director of Sleep Inn, so I have a really good balanced knowledge of how the hotel business works. My knowledge of the hotel and franchising [business] allowed me help shape a model that I know works for hotel operators.
HOTELS: And you left Choice to work for Yum! Brands’ hotel program?
Burr: Stepping out of the hotel industry and into the quick-serve restaurant category, I worked at Yum!, where I was responsible for Pizza Hut’s hotel program—Pizza Hut pizzas made in the hotel kitchen and delivered through roomservice.
Opportunity from there took me to Dunkin’, and I always had in the back of my mind that we could do something similar to what we did with Pizza Hut—allowing a hotel to produce Dunkin’ products in the main kitchen and have a Dunkin’ coffee outlet. We’ve put that together over the last three years, and now we have the ability to do that.
HOTELS: How does that work—having a Dunkin’ brand presence within a hotel or resort?
Burr: We’re offering wide portfolio of concepts that could be used in a hotel/resort application, ranging from a very simple, self-serve branded retail coffee-only counter presence as part of a gift shop, to a cart, to a kiosk, and to a full shop that you could walk into and order from a counter—it could even have seating if that was something a property wanted.
But one of things we’re not going to do is go into a big downtown hotel and build a Dunkin’ in a retail space that fronts a downtown city street. That’s not this model—that belongs to our traditional franchisee base. Where you see some of our competitors in major hotels as street corner shops in buildings, that’s not where this is intended to go.
HOTELS: What other brands are you competing with for these lodging developments … Starbucks?
Burr: Absolutely. Starbucks has a presence in many lodging properties around the country and has agreements with many large players. We have positioned Dunkin’ as a coffee and bakery alternative in these venues to that brand and others, like a Green Mountain or Seattle’s Best. We see it as a strong branded alternative to other coffee concepts.
HOTELS: What is your ideal lodging location host as you continue the company’s expansion into this sector?
Burr: The first thing take into account when we look at a lodging property is to make sure we protect our traditional franchisees on the street. We have to review each site carefully. Our ideal location is a large self-contained resort where we don’t have street access, large enough to have a central resort core that has a general store. So a vacation ownership property, a larger resort, convention hotels or airport hotels large enough to support the kind of capital investment it will take to make these things work.
HOTELS: What about your ideal from a brand perspective?
Burr: What we’re looking for there is a brand-fit that suits our current customer base and demographics. For example, a larger vacation ownership resort, like a Hilton Grand Vacations Club property, or Horizons [by Marriott Vacation Club].
HOTELS: And from a geographical or market standpoint?
Burr: Our focus on larger resorts takes us into destination areas—Orlando and Florida is a good market that I anticipate seeing strong results in, along with major airport markets around the country.
HOTELS: Finally, what additional equipment and supplies are needed in order for hotels or resorts to prepare Dunkin’s products?
Burr: Let’s look at that in two pieces: front of the house and back of the house. In the front of the house, a resort is going to need all of the items we use to produce our products: there’s coffee grinders, brewers, dairy and cup dispensers, the toasters for toasting bagels, the Turbochef oven for doing our breakfast sandwiches and flatbread sandwiches, etc. The back of house is where we can be very flexible with a property. They already have walk-in [refrigeration]. We don’t need to include a dishwasher—they have that. The only thing that is necessary then, assuming sufficient space for our product/dairy in their walk-ins, is some proprietary equipment for baking, glazing and finishing our bakery products.