Selling donuts and coffee alone lifted Dunkin’ Donuts to become one of America’s most loved brands and to grow to 10,000 outlets in 37countries. It owes much to the spunk and vision of its founder, William Rosenberg, who thought the 4 forms of donuts being served in US shops were an anomaly. So he proceeded to make 52 kinds and won. His creation is currently the world’s largest coffee and baked goods chain serving a lot more than two million customers a day.
Rosenberg had partnered with his brother-in-law to set up his first outlet in 1946. by 1953 he was keen on franchising the company, so he created a franchise brochure called Dollar From dunkin donuts flavors. He had to mortgage his house to purchase out Harry Winokur – he saw no future in franchising – and used just $90,000 from investors to start out as the banks were not convinced Rosenberg could grow the business through franchising. He proved the banks along with his brother-in-law wrong.
Rosenberg went into franchising within the belief his success lay in sharing his gains. With this thought, he started profit sharing with employees and in the end gave them stock options. He involved franchisees in decision-making, offering them representatives within the advisor councils to discuss goals and profit targets with management. Eventually, his franchisees got to enjoy a tremendous edge on independent operators as a result of Dunkin’ Donuts’ volume purchases, which made supplies cheaper, along with its top management team that backed them completely. Dunkin’ even hatched a clever pr campaign that helped secure its outlets. It recommended that franchisees provide free doughnut and coffee – to be consumed on the premises – to law enforcement officers on duty, hence buying protection for shops which were open twenty-four hours a day.
To compete more effectively, Rosenberg imposed continuous franchisee training and ultimately put up Dunkin’ Donuts University in Randolph, just outside Boston. He drew up a process that allowed Dunkin’ Donuts to redesign the business, redefine its strategy, and introduce new releases when possible. When Dunkin’ created its donut holes, the “munchkins” increased sales system-wide by 10 percent. To fulfill the health-conscious, it added oat bran and low-cholesterol donuts to its menu. Today the franchise routinely taps independent laboratories to evaluate its products to make sure they’re of the best.
Still, Rosenberg was sometimes challenging to satisfy. “I tell [people] that progress is the result of enlightened dissatisfaction. If you are satisfied, you are going to never get better,” he says inside the book Franchising, The Company Strategy That Modify the World by Carrie and Robert Shook. Nevertheless, Rosenberg remain (@committed to his people. And that he never lost faith in the son Bob who helped him manage the business in happy times and bad. In 1973, when sales dipped alarmingly as a result of Dunkin’s rapid expansion inside the Midwest, Bill and Bob toured the location and realized they have to close 100 stores and write off $3 million in losses. Because of this, Dunkin’s share price tumbled; angry board members and bankers leaned on Rosenberg to sack his top managers. His reply: “Look, I have faith within these people. Basically If I let them go, I must start around hiring others and teaching them all the stuff I have already taught our current management. Had you been a parent with Bob’s background and you will have the faith which i have in him, how could you let your son glance at the remainder of his life thinking he had been a failure? There is no way I would personally do that. I couldn’t let Bob and the others undergo life believing which they hadn’t succeeded.” His faith in the people proved him right. Dunkin’s share price recovered. And then in 1990, the same management team presided over Dunkin’s takeover of dunkin menu.
Rosenberg’s people paid him back in 1989, each time a Canadian financier started buying up Dunkin’s stock and then announced a takeover. Franchisees placed huge ads in The Wall Street Journal in protest, despite the fact that Dunkin’ eventually was required to sell later, the new parent firm, Allied Lyons, kept its management intact. Dunkin’ Donuts continued to prosper.
William Rosenberg died aged 86 on September 22, 2002 at his home on CapeCod. Today he or she is remembered for charting the course of one American success story, and for propagating and professionalizing the franchising business by assisting to establish the International Franchise Association, an organization committed to self-regulation and also to improving franchising being a itxino for expansion. In 1970, American lawmakers almost outlawed franchising due to the shenanigans of a few franchisers, so the group took over as the voice of the true and legitimate. In tribute to Rosenberg, it opened the William Rosenberg Franchise Leadership Institute, a school that now provides scholarships to people wanting to embark on a franchising career. “Inside my humble opinion, franchising is definitely the absolute epitome of entrepreneurship and free enterprise, and is also unquestionably probably the most dynamic economic factors in the world today,” Rosenberg says in the book Franchising, The Company Strategy That Changed The Planet. How true!