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Dunkin' Brands Edges into Asia

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It was revealed on Wednesday that Dunkin' Brands (NASDAQ: DNKN) is attempting to move heavily into emerging markets like India in an attempt to make up for slow growth back home.

CEO Nigel Travis said on Wednesday, speaking from New Delhi, that, "Emerging markets are attractive because they are growing very quickly, they've a fast-growing middle class, and they love American brands."

That much is absolutely true. There are very few countries in the world that don't have a McDonald's (NYSE: MCD) and/or Starbucks (NASDAQ: SBUX) on the high streets as American brands are seen as "cool" and even glamorous abroad, and DNKN will be hoping to jump on that cash cow itself.

To that end, it is aiming to open 80-100 Dunkin' Donut outlets in India over the next five years. It has formed a joint venture with Jubilant FoodWorks, which opened two new stores in New Delhi earlier in May. The joint venture is looking to open 500 stores in 15 years.

But India is far from the only country about to get the pleasure of a Dunkin' store on the streets, as the company plans to open 350-450 outlets outside of the U.S. this year, concentrating on Asia.

Now is the time for a little cultural note. Not every country in the world understands the concept of dunking a donut into coffee (or any other drink). In many nations, that would just seem weird. In the UK, for example, it is perfectly acceptable to dip cookies (or "biscuits") into tea and coffee, but to dunk a pastry or cake-like product in there would just seem bizarre as a donut lacks the sturdiness and ability to stick together when wet that a good choc chip cookie has.

Similarly, countries like India, China and Japan have their own hot drinks and their own dessert treats to eat with them. While different nations will often be open to trying new foods, they are usually very precious about their hot drinks.

All of which leads to the question, how well will a Dunkin' Donuts outlet do in an Asian country? Will there be a level of curiosity at first that will later die down? It'll be interesting to watch and find out.

Dunkin already runs 473 Baskin Robbins ice-cream outlets in India, and 120 in China. There are also 80 Dunkin Donuts outlets in China.

Follow me @BCallwood.

Posted-In: News Management Global


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