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Dunkin’ Donuts’ Unit Growth Is More Aggressive in US Market

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Apr. 9 2015, Updated 10:06 a.m. ET

Unit growth

Most of Dunkin’ Brands’ (DNKN) units are franchised. The company had a total of 18,862 combined units, or points of distribution, as of fiscal year 2014. Dunkin’ Brands has more stores in its US market than in its international market.

As of December 2014, there were 11,281 Dunkin’ Donuts restaurants and 7,581 Baskin-Robbins restaurants systemwide. In the United States, there were 8,053 Dunkin’ Donuts locations and 2,484 Baskin-Robbins locations. In the international market, there were 3,228 Dunkin’ Donuts and 5,068 Baskin-Robbins locations. So Dunkin’ Brands is more aggressive when it comes to growing units in the United States.

A restaurant earns revenue from its existing restaurants as well as from opening new restaurants. The two important drivers that drive revenue are same-store sales growth and unit growth.

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Over the last year, Dunkin’ Brands’ unit growth included adding 704 Dunkin’ Donuts and Baskin-Robbins locations in the system. In the United States alone, 376 Dunkin’ Donuts restaurants were added. Internationally, the company added 47 Dunkin’ Donuts restaurants. In contrast, 235 Baskin-Robbins were added in the international market and 46 were added in the United States.

How peers are growing units

Starbucks (SBUX) added 570 company-owned restaurants. Of this number, 254 were added in the United States. There were 1,029 franchise units, with 251 of them in the United States. McDonald’s (MCD), which is about 4% of the consumer discretionary ETF (XLY), added 829 restaurant units systemwide. For restaurants such as Chipotle Mexican Grill (CMG) and Shake Shack (SHAK), unit growth is a more important revenue driver than same-store sales.

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