Dunkin’ Donuts making big move into San Diego
Decades after exiting San Diego County, Dunkin’ Donuts is ready to launch a revival, with more than a dozen locations planned over the next eight years.
First up: National City, where local franchisee Burton Restaurants is preparing to open Dec. 6 a standalone outlet and drive-through on East Plaza Boulevard, the first since three stores opened on local military bases in the last several years, plus one other inside the downtown Embassy Suites in combination with a Baskin Robbins. There is also a Dunkin’ Donuts in Ramona but is not operated by Burton.
While the Burton group announced plans in 2014 to develop 14 doughnut shops in San Diego County over a period of several years, that effort eventually stalled because of challenges locking down the right real estate deals, said Tali Burton, a co-owner of the franchisee group.
“It’s been slow to materialize and we’ve been very picky with real estate,” said Burton, a former instructor pilot at Camp Pendleton and still in the Marine Corps reserves. “There have been sites that were former quick-serve restaurants but went under and there’s a reason why they went under.
“At the end of the day, I’m not the wealthiest guy in the world and I need this to succeed for my family so I was cautious.”
The Burton group is now bullish once again on San Diego and has signed leases for four additional locations on Rosecrans in Point Loma; inside the former NBC San Diego building on Broadway downtown; C Street, also in downtown; and a store in El Cajon.
The goal is to open those Dunkin’ branches all next year.
Ideally, Burton said he would like to bring on four to five new stores a year over the next five or six years. Looking ahead, he believes there’s room eventually to develop 30 outlets in the county, but his current agreement with the Canton, Mass.-based company is to complete 14 stores in eight years. His territory covers the part of San Diego County that lies south of Miramar.
Burton Restaurants currently owns outlets on Camp Pendleton, the Naval Medical Center San Diego, MCAS Miramar and in the Embassy Suites.
A huge fan of Dunkin’ Donuts who grew up on the East Coast where the brand was as prevalent as Starbucks, Burton even wrote his masters thesis on Dunkin’ Donuts as an MBA student.
“My thesis was that Dunkin’ was missing a great opportunity because when everyone is selling, it’s a good opportunity to buy and I explained why they failed in their expansion in Southern California.”
At one time during the late 1990s, there were about 15 Dunkin’ Donuts open in the California market, but they eventually all closed because the timing for the brand wasn’t great, said the company’s public relations manager in a 2012 interview.
Krispy Kreme was all the rage at the time, making it hard for Dunkin’ to compete, Burton theorized. And that was at a time when Dunkin’ was known more for its doughnuts and not its coffee.
Today, the company has nearly 12,000 restaurants in 45 countries worldwide. Dunkin’ Donuts was unable make available a company executive to talk about the San Diego expansion plans.
“We’re not really a doughnut company as much as we used to be. We’re much heavier into the beverage side of the business, which helps us against our competition,” Burton said. “Krispy Kreme is still around but in a smaller footprint.”
Burton co-owns the franchise with Ryan Redmond, president of Redline Surgical, a San Diego medical device distribution company, and Robert Fox, whose family until recently had operated more than 100 Wendy’s outlets on the East Coast.
The operations end of the Dunkin’ franchise business is run by Burton and some fellow Marines who all ended up at Camp Pendleton together.
Most of the new Dunkin’ Donut outlets planned for San Diego next year will be drive-through. The planned location on C Street happens to be a couple of blocks away from downtown’s enormously popular Donut Bar, which features a wide variety of gourmet doughnuts. Burton said he’s not concerned.
“We’re a beverage business first and foremost and when it comes to doughnuts, I feel like our product is on par with theirs but with a better price point,” he said. “They can have their fancy doughnuts but if you want a good Boston crème and don’t want to pay $4.25, you can come to us.”
