Taking a true look at where your business is taking you and working hard to give customers what they want. Bill Rosenberg, way to go.

Dave Young:

Welcome to the Empire Builders podcast, teaching business owners the not so secret techniques that took famous businesses from mom and pop to major brands. Stephen Semple is a marketing consultant, story collector and storyteller. I'm Stephen's sidekick and business partner, Dave Young. Before we get into today's episode, a word from our sponsor, which is, well, it's us, but we're highlighting ads we've written and produced for our clients. So here's one of those.

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Dave Young:

Welcome to the Empire Builders podcast. Dave Young here, along with Stephen Semple, talking empires. And what better way to get an empire started in the morning than to have a donut?

Stephen Semple:

There you go.

Dave Young:

And a cup of coffee.

Stephen Semple:

That's it.

Dave Young:

So today's topic is Dunkin Donuts.

Stephen Semple:

Dunkin Donuts. There we are. America runs on Dunkin, right?

Dave Young:

I don't know a lot of history about them. I have childhood memories of Dunkin Donuts and then no memories for a long time, and then sort of rediscovered them when my daughter was going to school in Boston. I think they're a Boston or Massachusetts origin story.

Stephen Semple:

They are. Very good.

Dave Young:

But I feel like they've had some ups and downs maybe.

Stephen Semple:

Oh, they've had a bunch of ups and downs. There's no question. But they are. They're from Quincy, Mass, just outside of Boston.

Dave Young:

Okay.

Stephen Semple:

Yeah. So they were started by Bill Rosenberg in 1950, and today they have close to 13,000 stores. They're the second-largest restaurant chain in the US, they're worth about $9 billion. And if you're in New York City, they have an unbelievable concentration in New York. There's one every five blocks. And I'll tell you, it was weird when I was in New York last summer, and you're walking around, it felt like there was one every two blocks. It's more how it felt. But there's literally one every five blocks in New York City.

Dave Young:

Including the airports, right? They're everywhere.

Stephen Semple:

They really are. So the origin of Dunkin really goes back to the late 1930s because the US economy at that point had been struggling for close to a decade. With the Great Depression, unemployment peaked at 20% in an era where there was little in the way of safety nets. And this actually had a big impact on the food business because at this time, snacks have started to be reinvented as lunch. So we're seeing this movement towards these smaller packaged foods. People wanted something small that was a fun to eat item, that was not expensive, that really started to dominate the food market. And we've seen that in other podcasts that we've done with other foods. So Bill Rosenberg is from Boston, and he has a successful food truck business. And by 1946, he's starting to make enough to start a brick-and-mortar location. So when he launches the business, here's something Bill notices, is that in his food truck business, 40% of the sales were coffee and donuts.

Dave Young:

Wow. Okay.

Stephen Semple:

That was 40% of the sales from the food truck. So when he launches the business, he realizes that he wants to create a new idea centered around coffee and donuts. And you know what, it's interesting. When we go back to companies like Toys R Us and things like that, or even a Dollar Store, it's this observation of, "Hey, here's this thing that's selling." Or in Toys R Us cases, they looked at it and said, boy, toys are a big part of a department store. Maybe we should just do something along that lines. So this is similar to what he saw. He saw, look, coffee and donuts is a big part of the sales. Why don't I create something around that?