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How Profitable is a Dunkin’ Donuts Franchise? Updated 2023

Are you a donut business enthusiast or an entrepreneur looking for an opportunity in the donut industry? Or are you thinking of applying for the Dunkin’ Donuts franchise, but you don’t know where to begin?

Then you’re in the right place. In this guide, we give you a detailed analysis of what Dunkin’ Donuts is and what it takes to make money as a franchisee.

We’ll look into how much it costs to open and run a Dunkin’ Donuts franchise and how much you can make with this business. Finally we’ll look into how profitable this franchise really is. Let’s dive in!

Dunkin’ Donuts franchise: key figures

Franchise fee$65,000
Royalty fee5.9%
Marketing fee5.0%
Investment (mid-point)$1,157,300
Average sales$1,056,521
Sales to investment ratio1.4x
Payback period*4.9 years (good)
Minimum net worth$500,000
Minimum liquid capital$250,000
* using 15% net profit margin

🔎 How does Dunkin’ compare vs. other franchises? Check the ranking

Dunkin’ Donuts: a brief introduction

Dunkin’ Donuts (“Dunkin’”, “Dunkin’ Donuts” or “DD”), is one of the leading coffee and donut shop chains globally. Headquartered in Canton, Massachusetts, the brand offers over 70 doughnut varieties and cold coffee drinks, bagels, breakfast sandwiches, and other baked goods in over 12,000 locations globally.

It was originally founded by Bill Rosenberg in 1948 in Quincy, Massachusetts, then known as ‘Open Kettle’. In 1950, after deliberating with his executives, Bill renamed the store Dunkin’ Donuts. The flourishing eatery shop was selling donuts for 5 cents and coffee for 10 cents. 

The Dunkin’ Donuts franchise was born in 1955 with its first franchise Quick Service Restaurant (QSR). Later renamed Dunkin’ Donuts Franchising LLC, the franchisor company develops, operates, and franchises retail restaurants utilizing the Dunkin’ system.

Later, the brand changed to Dunkin’ in 2019 reflecting its growth and increasing emphasis on coffee and other drinks as well as sandwiches. Today, the Dunkin’ brand has more than 12,000 franchise stores in the US and over 42 countries.

Dunkin’ Donuts franchise: pros and cons

Despite being a successful and profitable chain store, Dunkin’ has its share of pros and cons, just like any other business.

The Pros

The Dunkin’ Donuts franchise has some of the most amazing benefits you’ll ever get from a donut franchise such as:

  • Quality support team: at your disposal, you will have a team of experienced and qualified professionals ready to help your franchise prosper (real estate professionals, field marketing managers, and operations managers). They provide new franchisees with site selection information, and marketing and management information to help them scale their sales.
  • Recognized brand: Dunkin’ brand is well recognized in the US and worldwide. And with 98% brand recognition among consumers, the Dunkin’ brand is fast-moving. As a new franchisee, you have the advantage of selling to customers who understand your brand and what you offer. The better part is that Dunkin’, in a move to keep its brand strong, continues to market itself by partnering with global partners like Coca-Cola, JetBlue, and Saucony. 
  • Plenty of available markets: Dunkin’ Donuts started its operations in the Northeast with much of its royal support found there. However, with time, it has grown to many restaurants found in the East. The brand continues to expand and plans to have over 1000 new stores in the US alone. 
  • Proven business model: For more than 70 years now, the Dunkin’ brand has been in business. This gives them an upper hand in understanding the industry they operate in. They have mastered what works and how to operate for their business to succeed. 
  • Franchisor’s solid financials: The franchisor Dunkin’ annual profits surpass the $1 billion mark, and the company is very profitable in its industry. What’s more is that new franchises can also break even in a relatively short period of time (see more on that later)

The Cons

Even with a basketful of advantages, running a Dunkin’ Donuts franchise has its share of drawbacks:

  • A rigorous application process: As lucrative as the Dunkin’ Donuts franchise might look, applying and being accepted might not be easy. First, there are financial thresholds you must meet. To qualify as a DD franchise, you must have a net worth of $500,000 as well as meet the initial cost of $250,000
  • Stiff competition: Another challenge that Dunkin’ franchise faces today is competition. With fast food demands, many popular multinationals occupy the space. To name a few: Starbucks, Tim Hortons, Krispy Kreme, etc. This can create pressure on prices and profits in the long run

How much does it cost to open a Dunkin’ Donuts franchise?

In order to open a Dunkin’ Donuts franchise, you will need to pay a franchise fee between $40,000 to $90,000. This is on the higher side for quick-service restaurants (McDonalds for example has a $65,000 franchise fee).

The franchise fee isn’t the only reason why prospective franchisees can be reluctant to open a Dunkin’ Donuts franchise. Indeed, in addition to the $40,000+ franchise fee, you will need to invest a substantial amount as well.

Whilst the investment can of course come from your own pocket, but also investors or a SBA loan, you will need to show you have $250,000 in liquid assets as well as a net worth of $500,000 minimum per restaurant.

How much you need to invest?

Including the franchise fee, you must invest a total of $526,900 to $1,787,700.

This amount should cover both build costs (site development, equipment, etc.) as well as operating expenses (travel, opening inventory, runway for the first 3 months of operations, etc.). Here’s a summary of the different costs you should pay for:

Type of restaurantInvestment amount
Initial Franchise Fee$40,000 to $90,000
Build costs$91,400 to $742,500
Operating expenses$20,000 to $189,300
Total$526,900 to $1,787,700

The investment amount also depends on the type of restaurants you intend to open.

For example, you would invest significantly more for a freestanding vs. a gas & convenience restaurant. Here’s the full list:

Type of restaurantInvestment amount
Freestanding$526,900 to $1,787,700
Shopping Center / Storefront$437,500 to $1,174,700
Gas & Convenience$211,700 to $1,017,800
Source: FDD 2022

What is the turnover of a Dunkin’ Donuts franchise?

On average, a Dunkin’ Donuts franchise makes $1,056,521 in sales per year.

This amount represents the average median sales of all kinds of restaurants. It can change based on the type of restaurant or the restaurant’s location; for example, a drive-thru restaurant makes more revenue than a non-drive-thru restaurant.

Types of RestaurantMedian salesDrive-ThruNon Drive-Thru
Freestanding$1,205,059$1,420,783$989,336
Shopping Center / Storefront:$1,014,434$1,256,377$772,491
Gas & Convenience Restaurants$844,525$1,084,135$604,915
Non-traditional Outlets$1,162,067$1,162,067
Average$1,056,521$940,324$882,202
Source: FDD 2022

How profitable is a Dunkin’ Donuts franchise?

Dunkin’ Donuts franchises are very profitable businesses. Looking at the public information provided in the FDD, operating profit (after COGS, labor, rent and royalty fees) stand at 29% of sales, which is higher vs. the average profits for a quick-service restaurant.

Using the average annual turnover of $1,198,000, the average Dunkin’ Donuts makes about $351,000 in operating profit per year.

Of course, this doesn’t include any other expenses such as depreciation, other operating expenses, taxes and interest. Therefore, net profit margin would logically be lower. Unfortunately, there is no such data in the FDD.

Profit-and-lossAmount ($)As % of sales
Sales$1,056,521100%
COGS$(267,300)25.3%
Labor$(258,848)24.5%
Rent$(105,652)10.0%*
Royalty fees$(115,161)10.9%
Operating profit$309,561~29%
* Assumption (source: 2022 FDD)

Is a Dunkin’ Donuts franchise a good investment?

Now that we know Dunkin’ Donuts franchises have adjusted EBITDA margin of about 29%, it doesn’t tell us 2 things: what’s their net profit margin (after all expenses have been paid for) and whether they are good investment from a financial standpoint.

As per our analysis, Dunkin’ Donuts have net profit margins of about 15%, in line with the industry. This means that the average Dunkin’ Donuts franchisee earns $158,000 in profits per year.

Now that we know how much you can make with this business, we must compare profits to the investment cost to figure out whether a Dunkin’ Donuts franchise is a good investment. This is what we call the payback period: how many years it takes for a franchisee to recoup her/his investment.

We know that the average investment for a Dunkin’ Donuts is $1,157,300. Therefore, the payback period is about 4.9 years which is a good number. Indeed, anything below 4 is excellent, around 5-6 years is good, and above 7 years is mediocre.

In other words, it means that you will need to wait 4.9 years to recoup your original investment of $1.2 million, only from that point in time you will make profits.

Of course, this is an average, and the payback period of your franchise may be different based on a number of factors. In other to know whether you should invest in a Dunkin’ Donuts franchise, download our financial plan and customise it with your assumptions.

Download the Dunkin’ Donuts business plan and get your franchise funded

Including a 5-year financial plan built with the latest Franchise Disclosure Document numbers

How does Dunkin’ compare to other franchises?

FranchiseInvestment ($)Sales ($)S/I RatioPayback (years)Min. net worth ($)Min. liquid capital ($)
Chick-Fil-Ahttps://sharpsheets.io/blog/chick-fil-a-franchise-costs-profits/Chicken1,363,5104,227,4173.12.2--
Dunkin' Donutshttps://sharpsheets.io/blog/dunkin-donuts-franchise-costs-profits/Donuts779,0001,056,5211.44.9500,000250,000
Domino'shttps://sharpsheets.io/blog/dominos-franchise-profits-costs/Pizza398,7251,286,4283.23.9250,00075,000
Krispy Kremehttps://sharpsheets.io/blog/krispy-kreme-franchise-costs-profits/Donuts824,0003,400,0004.11.62,000,000300,000
Little Caesarshttps://sharpsheets.io/blog/little-caesars-franchise-costs-profits/Pizza1,022,850798,1130.88.5350,000150,000
Wingstophttps://sharpsheets.io/blog/wingstop-franchise-costs-profits/Chicken631,6951,460,4592.32.91,200,000600,000
Steak 'n Shakehttps://sharpsheets.io/blog/steak-n-shake-franchise-costs-profits/Burger, Milshakes815,6261,346,3321.74.01,500,000500,000
Crumbl Cookieshttps://sharpsheets.io/blog/crumbl-cookie-franchise-cost-profits/Sweets507,2241,582,0903.12.1300,000150,000
Taco Bellhttps://sharpsheets.io/blog/taco-bell-franchise-costs-profits/Mexican462,4131,650,0003.61.91,500,000750,000
Popeyeshttps://sharpsheets.io/blog/popeyes-franchise-costs-profits/Chicken1,095,7831,444,6171.35.11,000,000500,000
Smoothie Kinghttps://sharpsheets.io/blog/smoothie-king-franchise-costs-profits/Smoothie688,108573,2690.88.0300,000100,000
Jersey Mike'shttps://sharpsheets.io/blog/jersey-mikes-franchise-costs-profits/Sandwich574,3231,220,5862.14.7300,000100,000
Nothing Bundt Cakeshttps://sharpsheets.io/blog/nothing-bundt-cakes-franchise-costs-profits/Sweets538,6501,307,2802.42.7600,000150,000
Jimmy John'shttps://sharpsheets.io/blog/jimmy-johns-franchise-costs-profits/Sandwich513,650874,8451.73.9300,00080,000
Texas Roadhousehttps://sharpsheets.io/blog/texas-roadhouse-franchise-costs-profits/Steakhouse4,209,5002,955,5340.79.5n.a.200,000
Kung Fu Teahttps://sharpsheets.io/blog/kung-fu-tea-franchise-costs-profits/Bubble tea250,125353,2371.44.7n.a.25,000
Wendy’shttps://sharpsheets.io/blog/wendys-franchise-cost-profits/Burger1,374,8331,791,2311.35.11,000,000500,000
Burger Kinghttps://sharpsheets.io/blog/burger-king-franchise-costs-profits/Burger1,242,9501,215,9701.06.81,500,000500,000
Sonic Drive-Inhttps://sharpsheets.io/blog/sonic-drive-in-franchise-costs-profits/Burger1,467,0831,617,0001.16.01,000,000500,000
Panera Breadhttps://sharpsheets.io/blog/panera-bread-franchise-costs-profits/Sandwich2,290,5002,599,4321.15.97,500,0003,000,000
Pizza Huthttps://sharpsheets.io/blog/pizza-hut-franchise-costs-profits/Pizza935,575906,9111.06.9700,000350,000
KFChttps://sharpsheets.io/blog/kfc-franchise-costs-profits/Chicken1,802,0501,567,4740.97.71,500,000750,000
Arby’shttps://sharpsheets.io/blog/arbys-franchise-costs-profits/Sandwich1,184,9751,126,2631.07.01,000,000500,000
Dairy Queenhttps://sharpsheets.io/blog/dairy-queen-franchise-costs-profits/Ice Cream1,404,2201,143,1800.88.2750,000400,000
Jack in the Boxhttps://sharpsheets.io/blog/jack-in-the-box-franchise-costs-profits/Burger2,195,8001,755,5030.812.51,000,000250,000
Papa John’shttps://sharpsheets.io/blog/papa-johns-franchise-costs-profits/Pizza353,6951,101,1273.12.1750,000250,000
Zaxby’shttps://sharpsheets.io/blog/zaxbys-franchise-costs-profits/Chicken534,7502,229,1874.22.41,000,000500,000
Hardee’shttps://sharpsheets.io/blog/hardees-franchise-costs-profits/Burger1,759,0001,147,9750.710.21,000,000300,000
Culver’shttps://sharpsheets.io/blog/culvers-franchise-costs-profits/Burger4,044,5003,051,7620.88.82,000,000350,000
Five Guyshttps://sharpsheets.io/blog/five-guys-franchise-costs-profits/Burger511,2251,203,3662.42.8500,000250,000
Carl’s Jr.https://sharpsheets.io/blog/carls-jr-franchise-costs-profits/Burger1,860,3351,419,5160.88.71,000,000500,000
Baskin-Robbinshttps://sharpsheets.io/blog/baskin-robbins-franchise-costs-profits/Ice Cream465,100316,8150.79.8250,000125,000
IHOPhttps://sharpsheets.io/blog/ihop-franchise-costs-profits/Pancakes2,058,3021,553,3110.88.81,500,000500,000
Applebee’shttps://sharpsheets.io/blog/applebees-franchise-costs-profits/Casual American5,137,9662,356,9650.514.51,000,000500,000
Denny'shttps://sharpsheets.io/blog/dennys-franchise-costs-profits/Casual American3,785,4591,639,5490.415.41,000,000500,000
Papa Murphy'shttps://sharpsheets.io/blog/papa-murphys-franchise-costs-profits/Pizza433,174580,4411.35.0275,000125,000
Auntie Anne'shttps://sharpsheets.io/blog/auntie-annes-franchise-costs-profits/Pretzels229,692343,1351.55.6300,000100,000
Firehouse Subshttps://sharpsheets.io/blog/firehouse-subs-franchise-costs-profits/Sandwich613,186888,3561.44.6350,000100,000
Tropical Smoothie Cafehttps://sharpsheets.io/blog/tropical-smoothie-cafe-franchise-costs-profits/Smoothie430,500961,9692.23.0350,000125,000
Marco’s Pizzahttps://sharpsheets.io/blog/marcos-pizza-franchises-costs-profits/Pizza437,625895,5232.03.3400,000100,000
Cinnabonhttps://sharpsheets.io/blog/cinnabon-franchises-costs-profits/Sweets276,062394,8971.45.8300,000120,000
Cold Stone Creameryhttps://sharpsheets.io/blog/cold-stone-creamery-franchise-costs-profits/Ice Cream310,956417,5881.35.0250,000100,000
Jambahttps://sharpsheets.io/blog/jamba-franchise-costs-profits/Smoothie414,562597,0281.47.7300,000100,000
Church’s Chickenhttps://sharpsheets.io/blog/churchs-texas-chicken-fees-sales-costs/Chicken1,195,1471,395,0881.25.71,000,000300,000
Moe’s Southwest Grillhttps://sharpsheets.io/blog/moes-southwest-grill-franchises-costs-profits/Mexican792,3701,013,3611.35.21,000,000100,000
Tim Hortonshttps://sharpsheets.io/blog/tim-hortons-franchises-costs-profits/Coffee1,242,7501,188,2401.07.0500,000100,000
Checkers & Rally'shttps://sharpsheets.io/blog/checkers-franchises-profits-sales-costs/Burger837,8471,039,7731.25.4750,000250,000
Charleys Philly Steakshttps://sharpsheets.io/blog/charleys-philly-steaks-costs-profits/Sandwich509,806786,2331.54.3500,000100,000
Buffalo Wild Wingshttps://sharpsheets.io/blog/buffalo-wild-wings-costs-profits/Chicken3,546,9002,534,1480.79.31,500,000750,000
Rita's Icehttps://sharpsheets.io/blog/ritas-ice-franchise-costs-profits/Ice Cream215,839248,3401.25.8300,000100,000
A&W Restaurantshttps://sharpsheets.io/blog/aw-restaurants-franchises-costs-profits/Burger786,750851,2121.16.2350,000150,000
Hungry Howie’s Pizzahttps://sharpsheets.io/blog/hungry-howies-pizza-franchise-costs-profits/Pizza419,682806,8991.93.5750,000200,000
Bojangleshttps://sharpsheets.io/blog/bojangles-franchise-costs-profits/Chicken1,658,0001,801,0571.16.11,000,000500,000
McAlister’s Delihttps://sharpsheets.io/blog/mcalister-deli-franchise-costs-profits/Sandwich1,424,9631,865,8611.35.11,000,000500,000
Round Table Pizzahttps://sharpsheets.io/blog/round-table-pizza-franchise-costs-profits/Pizza783,2501,037,8161.35.0500,000200,000
Qdoba Mexican Eatshttps://sharpsheets.io/blog/qdoba-mexican-eats-franchise-costs-profits/Mexican659,250972,9621.54.5
Freddy’shttps://sharpsheets.io/blog/freddys-franchise-costs-profits/Burger1,453,0401,792,9291.25.41,000,000400,000
Taco John’shttps://sharpsheets.io/blog/taco-johns-franchise-costs-profits/Mexican1,119,0001,124,9801.06.61,000,000400,000
Scooter’s Coffeehttps://sharpsheets.io/blog/scooters-coffee-franchise-costs-profits/Coffee1,143,250797,1010.79.6500,000200,000
Einstein Bros. Bagelshttps://sharpsheets.io/blog/einstein-bros-bagels-franchise-costs-profits/Sandwich750,075885,0111.25.71,000,000536,500
Great American Cookieshttps://sharpsheets.io/blog/great-american-cookies-franchise-costs-profits/Sweets385,275452,7711.25.7250,000100,000
Wienerschnitzelhttps://sharpsheets.io/blog/wienerschnitzel-franchise-costs-profits/Hot dogs873,300880,9801.06.6600,000250,000
Blaze Pizzahttps://sharpsheets.io/blog/blaze-pizza-franchise-costs-profits/Pizza865,4501,096,4321.37.9500,000300,000
Wetzel's Pretzelshttps://sharpsheets.io/blog/wetzels-pretzels-franchise-costs-profits/Pretzels377,571748,8572.03.4300,00050,000
Pizza Ranchhttps://sharpsheets.io/blog/pizza-ranch-franchise-costs-profits/Pizza3,268,3001,174,0880.418.61,000,000297,000
Del Tacohttps://sharpsheets.io/blog/del-taco-franchise-costs-profits/Mexican1,406,8501,345,3411.07.02,000,000500,000
Schlotzsky’shttps://sharpsheets.io/blog/schlotzskys-franchises-costs-profits/Healthy, Salads1,102,9331,053,3330.322.21,000,000300,000
Captain D’shttps://sharpsheets.io/blog/captain-ds-franchise-profits-costs/Seafood982,7781,067,8160.419.01,000,000350,000
Biggby Coffeehttps://sharpsheets.io/blog/biggby-coffee-franchise-profits-costs/Coffee310,575648,3520.320.0300,000100,000
Which Wichhttps://sharpsheets.io/blog/which-wich-franchises-profits-costs/Sandwich330,375281,8860.322.2500,000150,000
Marble Slab Creameryhttps://sharpsheets.io/blog/marble-slab-franchises-costs-profits/Ice Cream407,360251,0520.416.7250,000100,000
Mountain Mike's Pizzahttps://sharpsheets.io/blog/mountain-mikes-franchise-profits-costs/Pizza410,900865,7130.320.0300,000100,000
Huddle Househttps://sharpsheets.io/blog/huddle-house-franchise-cost-profits/Diner988,743712,4280.513.3600,000300,000
L&L Hawaiian Barbecuehttps://sharpsheets.io/blog/ll-hawaiian-barbecue-franchises-costs-profits/BBQ334,350612,9210.333.3500,000150,000
Chicken Salad Chickhttps://sharpsheets.io/blog/chicken-salad-chick-franchises-costs-profits/Healthy, Salads651,0001,202,0200.320.0750,000250,000
Golden Chickhttps://sharpsheets.io/blog/golden-chick-franchises-costs-profits/Chicken362,975917,6092.52.62,000,000425,000
Perkinshttps://sharpsheets.io/blog/perkins-franchise-costs-profits/Diner1,922,7281,729,2460.97.41,500,000500,000
Waba Grillhttps://sharpsheets.io/blog/waba-grill-franchises-costs-profits/Teryaki454,000466,5361.06.51,000,000250,000
Bruster’s Ice Creamhttps://sharpsheets.io/blog/brusters-franchises-profits-costs/Ice Cream663,925466,6960.79.5375,000150,000