A New Twist

Franchise and business opportunities at a glance.
Magazine Contributor
8 min read

This story appears in the May 1997 issue of Entrepreneur. Subscribe »

With the turn of the century just around the corner, Dunkin' Donuts is taking great strides toward modernizing its image. "We made a strategic decision to change our focus from being the No. 1 doughnut chain in the U.S. to being America's best coffee and baked goods retailer," explains Will Kussell, president of the 46-year-old franchisor based in Randolph, Massachusetts.

The systemwide changes, which encompass everything from a more contemporary store design and layout to a wider product selection and adjustments in store operations, are already reflected in five prototype stores across the nation. Within the next three to five years, Kussell expects all Dunkin' Donuts' 3,400 U.S. units to follow suit.

"When you walk into our new store," Kussell explains, "there's a very contemporary, warm feeling that is more like a neighborhood coffee shop than a traditional doughnut shop."

The company's first strategic changes occurred two years ago when Dunkin' Donuts rolled out a line of flavored coffees and low-fat muffins at many of its establishments. And with bagels now sharing the menu in 1,700 locations, the company's emphasis on the overall bakery experience will ensure consumers know Dunkin' Donuts is no longer just a doughnut shop. "We feel we are uniquely positioned to deliver great coffee and great baked goods," says Kussell. "No one else delivers [these products] like we do."

With Honors

Porcelain refinishing opportunity Kott Koatings Inc. made history in December when it became the first business opportunity to receive the U.S. Department of Commerce's highest honor for American exporters.

The Foothill Ranch, California-based company was one of six U.S. firms given the president's "E" Award for Excellence in Exporting. Established in the 1960s by President Kennedy, the award recognizes American companies' outstanding achievements in global markets and contributions to the U.S. economy.

Kott Koatings measures up to that standard: Founded in 1953 by John T. Kott, the family-owned business first took its concept across borders in 1989 and found such great success that today its licensees have entered no less than 40 countries. Vice president John M. Kott says he is "extremely thrilled" to receive the award and especially to be the first business opportunity so honored. "The president is coming to realize that [business opportunities are] a very valuable export," says Kott.

Former U.S. Secretary of Commerce Mickey Kantor (pictured, center) presented the "E" Awards to recipients at an awards ceremony held at the Department of Commerce in Washington, DC.

Packing Up

By Janean Chun

Ending a controversy that had mail and parcel franchises up in arms (see"Franchise News," October 1996), the U.S. Postal Service (USPS) recently announced it would discontinue its Pack and Send services.

Many franchisors and franchisees in the industry perceived the Pack and Send services, which offered many of the same products as mail and parcel stores at lower prices, as direct competition from a government agency. Yet it wasn't the outcry that halted the USPS' plans. "It was purely a legal issue," says Rachel Southworth, executive director of the Coalition Against Unfair USPS Competition. "The Postal Rate Commission [PRC] determined that Pack and Send is indeed a postal service, and if the USPS wants to offer the service, it has to go through the proper channels and submit a rate case, just as it does with postage stamps, money orders and everything else it offers. It was skirting the authority of the PRC."

Rather than file a rate case, the USPS decided to drop the service, which had been in the test stage. "There is no plan at this time to reinstate that product line," says Bil Paul of the USPS.

"We were pleased with the decision," says Southworth. "But we have to temper our enthusiasm with a dose of reality. If at any time the Postal Service decides it wants to offer Pack and Send again, it can simply take it to the PRC for a rate. It's that easy."

Because this possibility looms, the Coalition Against Unfair USPS Competition continues to pursue legislation limiting the Postal Service from providing any commercial services that it did not offer nationwide prior to January 1, 1994. The legislation "would take [the USPS] out of the business permanently," says Southworth. "[The recent announcement by the Postal Service] is a victory for now, but that doesn't necessarily mean it's over for good."

Back To School

By Lourdes Aguila

Interested in attending The Franchise Center's Franchise Management Certificate Program at the University of Texas, El Paso? For entrepreneurs who make the grade, three scholarship programs are available. Two of the scholarships cover the cost of the four-week certificate program, in which seasoned professionals and franchisees teach what it takes to start your own business or franchise. The third focuses on shorter seminars covering various business-related topics.

*The Referral Pool Inc. Scholarship: This $650 scholarship, established in 1995 by program alumni Joe Prati III and Martha I. Garcia, is given annually to individuals who want to attend the four-week certificate program.

*The Bank of the West Scholarship: New this year, this $650 scholarship (given at least once per year) offered by Bank of the West will go to an individual from the El Paso region planning to attend the four-week session.

*The Dr. David and Carolyn Gough Scholarship: Center director Carolyn Gough and husband David established this $825 scholarship for individuals interested in attending the center's two-and-a-half-day seminar.

The seminar covers topics such as business plans, franchise law, site selection and marketing, and includes presentations by accountants, franchise owners and lawyers. Applicants must show financial need and have a history of academic excellence.

Deadlines for application vary; for more information, call (915) 747-7730.

Buyer's Market

By Holly Celeste Fisk

It's an online shopping mall . . . but it's the stores that are for sale, not what's in them. Welcome to the Business Resale Network, an online mecca for those looking to buy an existing business.

Since its unveiling last New Year's Eve, the site has averaged nearly 1,000 searches per day of the 2,500 businesses it lists for sale across the country. Searches can be made by business category, geographical area or list price.

"Our goal is to be the largest online listing of businesses for sale in the United States," says Gary Gardner, publisher of Franchise Update Publications, partner with Entrepreneur in operating the site.

Gardner hopes to have between 7,000 and 10,000 businesses listed by June. And if all goes well, sites for Canada and other foreign countries are sure to follow.

To browse the list of businesses for sale by owners, brokers, franchisors and franchisees free of charge, access the site at (http://www.entrepreneurmag.com), or call (888) BRN-2400.

Coffee Shop

Wake up and smell the opportunity: JC Java is offering would-be franchisees the chance to get in on the coffee craze by opening units in JC Penney department stores west of the Mississippi.

The innovative concept was introduced in a Las Vegas JC Penney store in December. Although the prototype store is thus far run by The Coffee Group, the Costa Mesa, California, developer of specialty coffee franchises that will execute the master licensing and individual sales of JC Java outlets, all 12 outlets expected to open by midsummer are intended to be sold to franchisees.

"We're specifically looking for owner/operators, and we'll deal with one operator in each region," says Greg Casserly, president of The Coffee Group.

For franchisees, the demitasse of benefits runneth over: "Our contract with JC Penney," says Casserly, "provides franchisees with instant national identity and distribution, high-visibility locations with built-in business, and rents that are significantly below market [rates]."

JC Penney hopes the new outlets will revive thirsty customers for more shopping. "If the customer has to leave to be refreshed," points out Casserly, "[JC Penney] loses them."

Contact Sources

Business Resale Network, P.O. Box 20547, San Jose, CA 95160, (888) BRN-2400;

Coalition Against Unfair USPS Competition, 3830 Valley Center Dr., #705-314, San Diego, CA 92130, (619) 623-1773;

The Coffee Group, 151 Kalmus Dr., Ste. H4, Costa Mesa, CA 92626, (888) CAFE-TCG;

Dunkin' Donuts, 14 Pacella Park Dr., Randolph, MA 02368, (617) 961-4020;

The Franchise Center, University of Texas, El Paso, College of Business Administration, El Paso, TX 79968-0545, (800) 687-4512, (915) 747-7730;

Kott Koatings Inc., (714) 770-5055, fax: (714) 770-5101;

U.S. Department of Commerce, (202) 482-3809;

Z Land Inc., (714) 708-8580, jveenstra@mail.zland.com.

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