Dunkin' franchisees welcome Travis' approach

Dunkin' franchisees welcome Travis' approach
Tags: Coffee/Bakery/Donut, Franchising & Growth, Legal Issues, Operations Management
February 18, 2010 - Christa Hoyland

*For a slideshow of images from Baskin-Robbins and Dunkin' Donuts, click here.

It's easy for an executive to say he is franchise focused, as Nigel Travis, CEO of Dunkin' Brands, told QSRweb.com in a story posted Monday. How franchisees perceive that focus can be another matter.

But Travis is living up to that statement, at least from the point of view of franchisees represented by the Dunkin' Donuts Independent Franchise Owners organization.

"Nigel has reached out to franchise owners across the country and across the world," said Jim Coen, president of the DDIFO. "He is making it a priority to listen to franchisees."

Coen is not a Dunkin' Donuts franchisee himself but has years of extensive franchise experience and hears regularly from Boston-based DDIFO members. DDIFO-member franchises are located primarily in the Northeast but is focusing on gaining more members from across the United States as the company grows.

Not only is Travis and his new leadership team listening to franchisees, but he also is allowing them to be part of the decision-making process, he said. The company's decision to wait for franchisees to weigh in on the value test in the Chicago and Detroit markets before moving it forward is just one example.

"That's an example of his leadership," said Coen, who took over leadership of DDIFO about the same time Travis came on board at Dunkin'. "This refreshing approach is one that's been very much accepted, appreciated and welcomed by franchisees."

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Franchisees also are pleased by Travis' focus on improving operations and store and franchise economics, he said. Dunkin' Donuts value their loyal customer base — which allowed the company to again earn top ranking for brand loyalty in the coffee category — and want to keep them happy. Improving operations will only further that goal.

Some concerns remain

While franchisees like being part of the decision-making process, some have lingering concerns from issues that arose under the previous leadership team led by Jon Luther. Some franchisees, who wished to remain off the record, say they have not seen any changes in Dunkin' Donuts aggressive approach to litigation. And they are still upset over what they say is the company's policy of mandating the installation of a single-provider video surveillance system because they fear the company will use the system to spy on them.

In regard to video surveillance, Andrew Mastrangelo, company spokesman for Dunkin' Brands, said that the company has never had a mandate for franchisees to install the systems.

"We only recommend video surveillance systems for specific franchisees who have demonstrated an unwillingness or inability over a long period of time to meet our operational standards for creating an optimal customer experience, such as safety, quality of products, merchandising, etc," he said.

Video surveillance has become standard in the quick-service industry and is typically used as a deterrent for theft and other crimes. But some Dunkin' Donuts franchisees balked at the idea of the corporation having access to the video feed.

Dunkin' Donuts had more than 350 outstanding lawsuits against franchisees at the end of last year, a number that affected their standing in AllBusiness' Top 10 AllStar Franchise businesses ranking for 2010. Coen said franchisees take the hiring of franchise industry expert Rich Emmett as senior vice president and general counsel as a good sign the company is likely to back off of its formerly aggressive legal approach. They are also encouraged by Travis' track record of working through issues with collaboration.

Since Emmett's hiring, Coen said the number of calls he has received from franchisees and attorneys regarding new lawsuits has diminished. He has not seen the newest franchise disclosure document to determine if the number of lawsuits has reduced.

Mastrangelo said that the company's focus is to better serve its customers and is working closely with franchisees to achieve that.

"We have never pursued litigation against a franchisee without clear cause, nor will we," he said. "We share a common goal with our franchisee community — to protect our brand reputation and their investment in the brand."

Willingness to empower, engage

Coen said that for a number of Dunkin' franchisees it's important that Travis and his team rebuild the trust they lost under Luther's leadership. And Travis has taken steps in that direction.

"It's just his willingness to empower and engage franchisees in the process and moving the brand forward," he said. "That's the thing that franchisees are just excted about. He gets it. He gets it on a franchisee level what has to happen, and he's empowering them and engaging them lke they haven't been for a while.

"That is going to be a major help in the next few years in growing this brand."