Dunkin Stores Closings 2020: Why Is The Doughnut And Coffee Chain Closing 450 Stores?

Doughnut and coffee chain Dunkin (DNKN) has announced that it will close 450 stores that are located inside Speedway convenience stores by the end of 2020.

The stores represent less than 0.5% of Dunkin’s U.S. systemwide sales in the U.S. The company said it can better support these markets with its own stand-alone stores, which it currently has 9,600 locations. The stores located inside Speedway also have limited menus, don’t accept Dunkin’s loyalty program, or allow for ordering through its mobile app, Restaurant Business reported.

"We will be exiting 450 limited-menu Dunkin' Speedway owned and operated locations throughout 2020, closing under a termination agreement entered into with Speedway,” Kate Jaspon, Dunkin' Brands chief financial officer said in a statement.

“These limited-menu locations are lower volume units, in total representing less than 0.5 percent of Dunkin' U.S. annual systemwide sales. By exiting these sites, with minimal financial impact, we're confident we'll be better positioned to serve many of these trade areas in the coming years with new Dunkin' NextGen restaurants that offer a broader menu,” she added.

The Dunkin locations inside Speedway are owned and operated by the convenience store and was formed through a partnership with Hess, which Speedway acquired in 2014, the news outlet said. Dunkin said it has plans to open a net of between 200 and 250 stores by the end of the year, excluding the Speedway closures.

Dunkin reported a U.S. comparable sales growth of 2.1% for fiscal 2019, adding 211 net new locations in the states. Revenues also increased for the company by 3.7%.

Shares of Dunkin stock were down 0.03% as of 11:17 a.m. EST on Friday.