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Jubilant halves Dunkin’ Donuts’ store size in search of profitability



New Delhi: Jubilant Foodworks has reduced the store size of the new Dunkin’ Donuts outlets by nearly half, as the company looks to reduce the donut brand’s losses in the financial year 18, and eventually grow the bsuiness towards profitability.

“So the average size has varied earlier from 800 square feet to about 1200 square feet, and the stores that we have opened have been on the smaller side, they have been ranging from 300 square feet to about 650-700 square feet,” Pratik Pota, chief executive officer of Jubilant Foodworks told investors and analysts during conference call after announcing the third quarter results for financial year 2017-18.

The company which operates Domino’s Pizza and Dunkin’ Donuts in India, had reported more than three-fold increase in its year-on-year net profit at Rs 66 crore for the third quarter ending December 31.

According to Pota, for Dunkin’ Donuts, the company is looking at model that is focused on donuts and beverages, with simple food. The other part of the model is to look at smaller format stores, he said.

“So the work we have done in opening new stores should test some of these smaller format stores. And the initial results towards this are encouraging and we are seeing some growth coming in these stores on account of both the portfolio and the size of the stores,” the executive said.

During the quarter Jubilant Foodworks opened only 1 new Dunkin’ Donuts outlet while closing 9 existing outlets, taking the total store count to 44 across 12 cities. At the end of the first quarter of financial year 2018, Dunkin’ Donuts had 55 outlets.

Pota during the call said, they continued to make good progress on the company’s stated objective of halving losses of Dunkin’ Donuts.

“The sharp focus on donuts and beverages along with shutdown of unprofitable stores led to our losses reducing significantly. Looking ahead, we will continue to execute on our strategy for growth outlined at the start of the year with discipline and consistency.”

The company had at the begining of the year revealed its plan to open 5 Dunkin’ Donuts store through the financial year 2017-18.

“Dunkin’ Donuts we have said that we will be opening 5 stores this year and we stay with that guidance, there is no change there. We have opened 4 already and we plan to open 1 more this quarter,” Pota said.

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