0 Replies Latest reply: Jan 10, 2012 1:08 AM by James Chua RSS

Dunkin’ Donuts procurement goes national

James Chua Newbie
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Under the agreement, which came into effect 1 January and was  announced by the company yesterday, the National DCP (NDCP), a  co-operative wholly owned by franchisees of the coffee and doughnut  outlet which carries out deliveries and purchasing, will become the  exclusive supply chain provider for all US Dunkin’ Donuts outlets.

The deal, which is described as “long-term” and “performance-based”,  follows the move by the NDCP to merge its four regional NDCP branches  into a single nationwide entity. As a result, the prices paid for  products and services by franchisees will be the same, irrespective of  geography and outlet frequency.

Currently, prices vary in relation to market activity; with  franchisees in less popular markets having to pay a premium as a result  of factors such as longer distribution routes.

“This agreement is a momentous one for Dunkin’ Brands and for  existing, new and future Dunkin’ Donuts franchisees,” said CFO Neil  Moses. “In addition to securing our franchisees’ role in the Dunkin’  Donuts supply chain, it will result in significant cost savings a higher  level of service, and, in the near term, uniform product costs for  franchisees across our domestic restaurant network.”

The company explained that the agreement, and the fact that it will  even the playing field between franchisees, is central to its ambition  to more than double the number of stores over the next 20 years.

Through the agreement, the franchisees will be able to maximise their  buying power and also take on more of a strategic role in supply chain  operations, as they will be wholly run by NDCP.

Kevin Bruce, NDCP CEO, said: “We are excited to announce the  formation of this new national entity and our long-term agreement with  Dunkin’ Brands to be exclusive supply chain provider for all Dunkin’  Donuts restaurants in the US. Our mission is to provide our members with  the very best purchasing and distribution service in the QSR  [quick-service restaurant] industry.”

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