2.3 SWOT Analysis 2.3.1 Strengths Dunkin’ Donuts has 120 year franchise experience serving in the industry and a worldwide chains of totaling 18,000 location across 60 countries. It has a reputation for high quality of product like coffee for more than five decades which uses 100% Arabica coffee beans; and approximately 2,000 beans go into making just one pound of Dunkin’ Coffee and has use its own coffee specifications, which recognized by the industry as a superior grade of coffee (dunkindonuts.com, 2014).
DD will not only option for consumer to get a cup of coffee because all of these competitors have use same kind of strategy like offers coffee, breakfast and even added various flavors of coffee such as latte, cappuccino, frapp’s which is competitive with these market. [Online] Available at: https://sites.google.com/site/starbucksversusdunkindonuts/vrio-analysis [Accessed 30 July 2014].
Continuously, DD also has combine the food with coffee with lower price to provide good quality of coffee and food like sandwich, tuna fish on a toasted balgel with cheaper price.
Dunkin’ Donuts could be said organized to exploit with 7,015 franchise restaurant in the United State and over 18,000 location nearly 60 countries is one of the world’s most recognized and desired franchises (dunkinfranchising.com, 2014).
This success has proved that DD franchised business model include their extensive branding and marketing efforts have leads DD to further expand their franchises business model more efficient in the future.
With 120 years of franchising experience, Dunkin Donut brand is one of the world most recognized and beloved coffee brand in America (dunkinfranchising.com, 2014).
They have a 94% brand awareness level, which difficult for any other company to imitate. 2.1.3 Threat of New Entrants The threat of entrant in the competition with Dunkin’ Donut is low except Starbucks because its need a large amount of capital associate with the real estate. Although it can be still operate in small scale but it still need competition to incumbent firms with franchise. DD able to sells more than 30 cups of freshly brewed coffee each second and serving nearly 1 billion coffee by the cup each year or approximately 2.7 million cups a day (dunkindonuts.com, 2014). DD also has offers discount cards and special deals coupon to customer. Therefore, there will still don’t have another Starbucks or DD in the market because the market in U. If new competitors would want to enter market, they will need to provide good quality coffee and also with reasonable price because the demand of market has changed since DD has provide variety product with cheaper coffee. [Online] Available at: files.pomona.edu/jlikens/Senior Seminars/Likens2012/reports/[Accessed 30 July 2014]. 2.1.4 Threats of Substitutes In this industry, there are higher level of threat of substitutes because there are many alternatives to this product include Starbucks Coffee, Mc Donald’s Coffee, tea and those is store-bought coffee or snacks. After that, SWOT analysis also done to make an understanding on the strengths and weakness of the company and to identify the opportunities and threats for the company. Higher reputation for product quality and Grab & Go concept that brings fast and convenience service. Bargaining power of supplier is low for Dunkin’ Donuts because there are not only one suppliers who supply breakfast items and coffee beans; and the supplier does not have much bargaining power as they typically will be in a contract. Overall we could determine that the quick service coffee industry is an attractive industry to the incumbent firm because of the lower power of both suppliers and buyers and low threat of entrants. 2.2 VRIO Analysis 2.2.1 Brand Image “Coffee for the Average American” Dunkin’ Donuts focuses on their product and prices that are preferred by and appeal to the working middle class American.