Why Dunkin’ Donuts K-Cups Aren’t Selling

Why Dunkin' Donuts K-Cups Aren't Selling

Sales of K-cups, those little plastic pods for Keurig single-serve coffee brewers, have been on a tear in recent years. Which makes it all the more surprising that Dunkin’ Donuts, beloved across the U.S. for its coffee, is struggling to sell K-cups of its own.

Despite the launch of a new dark roast variety in the fall, Dunkin’ Brands Chief Executive Officer Nigel Travis said at a conference on Monday that the company’s K-cups “had double digit negatives” last quarter. In other words, sales fell by more than 10 percent. K-cup sales by Keurig Green Mountain, in contrast, increased 13 percent in fiscal year 2014.

Dunkin’ has adopted an unusual (and apparently not very effective) K-cup sales strategy. Unlike competitors such as Starbucks that sell K-cups through multiple channels, Dunkin’ sells its pods only in its restaurants, not in grocery and other mass retail outlets. The goal, as Travis previously explained to investors, is to avoid cannibalizing restaurant sales—Dunkin’s core business—by offering more ways for consumers to brew Dunkin’ coffee at home. Even if K-cups present a new source of revenue for franchisees, they’re only a very small piece of the business, according to Raymond James analyst Brian Vaccaro.

The strategy may protect sales of Dunkin’s brewed coffee, but it fails to take advantage of strong demand for K-cups as the selection in supermarkets expands. And increased K-cup competition is leading to some price-cutting, Vaccaro says. Dunkin’, for instance, ran a holiday K-cup promotion offering two boxes for $16, compared to the regular price of $10 each. The chain’s domestic comparable store sales increased 1.4 percent in the fourth quarter, but that jump would have amounted to just over 2 percent were it not for the decline in K-cup sales, Travis told investors.

It’s not just Dunkin’s K-cup sales that are suffering; sales of its bagged coffee are also down. In a statement to Bloomberg Businessweek, the company attributed that decline to “the growth of the single serve format.” Which, at the moment, doesn’t actually include Dunkin’s own K-cups.

Read More:Keurig single-serve coffee brewers

Company Profile

Romiter Group is a market leading designer and a manufacturer of coffee capsule filling sealing machinery, include coffee capsule packing machine, coffee capsules filling sealing machine, nespresso capsules filling sealing machine, k-cup filling sealing machine, lavazza blue capsules filling sealing machine, coffee pod filling sealing machine, coffee pod packing machine, coffee bean roasting machinecoffee capsules carton box packing machine, manual coffee capsules sealing machine

Welcome to Contact Us

    Please enter your contact information and the details you want to know about our product.

    Your Name (required)

    Your Email (required)

    WhatsApp

    Skype

    Subject

    Country

    Your Message

    PREV
    NEXT

    RELATED POSTS

      Inquery now

      SUBSCRIBE TO OUR NEWSLETTER

      FOLLOW US

      Facebook Twitter Pinterest YouTube WhatsApp Skype
      error: Alert: Content is protected !!

      Coffee Capsules Packing Machine Supplier Skype

      Coffee Capsules Packing Machine Supplier Email

      Coffee Capsules Packing Machine Supplier Whatsapp

      Coffee Capsules Packing Machine Supplier Telegram

      Coffee Capsules Packing Machine Supplier Wechat