US coffee and food-to-go chain to permanently close 450 petrol station concession stores by the end of 2020 after terminating partnership with the retail arm of energy firm, Hess, which was acquired by Speedway in 2014
A drive-thru at one of Dunkin's 'Next Generation' stores in the US | Credit: Courtesy of Dunkin' Brands
In a press statement, Dunkin’ said the concession store closures would enable the brand to focus on standalone cafés and that it remained committed to growing its presence at travel hubs, public buildings and convenience locations. The majority of the affected Speedway stores are located on the US east coast.
"These points of distribution are lower volume units, in total representing less than 0.5% of Dunkin’ U.S. annual system-wide sales in 2019," said Kate Jaspon, Dunkin's Chief Financial Officer.
“By exiting these sites, we are confident we will be better positioned to serve these trade areas with Dunkin’s newest Next Generation restaurant design that offers a broader menu and modern experience,” Jaspon added.
Dunkin' first announced the dissolution of its partnership with Hess during an earnings call in February 2020. Since then, the Covid-19 pandemic has caused severe disruption across the US, with Dunkin’ forced to temporarily close most stores and shift to takeaway, delivery and drive-thru
to maintain sales. In May 2020 Dunkin’ reported a 19.4% fall in US like-for-like sales during the final three weeks to March 28. The majority of its stores in the US have since reopened.
Dunkin’s closure of its Speedway concession stores comes amid an on-going brand revamp, which began in late-2018
with removal of ‘Donuts’ from the coffee chain’s logo. Since then Dunkin’ has sought to emphasise greater quality
by introducing an enhanced espresso range, improving its food menu and refitting stores.
In February 2020, Dunkin’ hailed its premiumisation strategy a success
after posting 2.1% like-for-like sales growth for 2019. Dunkin’ currently operates some 13,000 restaurants in 41 countries worldwide, with around 9,600 stores located in the US.