Dunkin' to open hundreds of stores overseas

The Asia-Pacific region is the focus of 350 to 450 new locations.

By InvestorPlace May 30, 2012 11:24AM
Junk food is becoming quite the American export.

The Wall Street Journal reports that Dunkin' Brands (DNKN), the corporate parent to Dunkin' Donuts and Baskin-Robbins, is looking to open as many as 450 locations outside of the U.S. this year.


And Dunkin' isn’t alone in the quest to capitalize on the taste for American food abroad. A growing middle class in emerging markets has prompted a race to India, China and Brazil among U.S. fast-food giants.


Dunkin' announced plans to open 350 to 450 outlets abroad this year under its Dunkin' Donuts and Baskin-Robbins nameplates. That's an ambitious number spread across the world, focused on the Asia-Pacific region that includes India, Taiwan and China.


"Emerging markets are attractive because they are growing very quickly, they've a fast-growing middle class, and they love American brands," DNKN chief executive Nigel Travis told the Journal.


The reason is simple math: These regions are growing, and the middle class as a portion of the population is growing, too. That means more are eating out, more packaged food sales and more interest in U.S. tastes as populations get plugged into American brands via the Internet and television.


In the past two years, we have seen similar mad dashes into regions such as Brazil, Africa, India and China.


Yum Brands (YUM) has seen huge success abroad with its various franchises. Thanks to stores that offer a potato and paneer burrito in India Taco Bells and KFC in Kenya, more than half of the company's profits come from overseas. Those international sales are powering big growth, too. YUM earnings for the first quarter of 2012 rose a whopping 73% on global sales growth.


And then, of course, there's the 900-pound gorilla of fast food. McDonald's (MCD) is in the middle of its biggest expansion to date in China, building on a 2011 plan that aims to open 700 new stores by 2013 and to hire as many as 70,000 workers.


Even Starbucks (SBUX) is getting in on the act. Last year the company partnered with Tata Group, a company that has teamed up with Dunkin' on its India expansion, to bring mochas to Mumbai.


Any way you slice it, fast-growing fast-food sales are driving the growth of some of the biggest U.S. restaurants.


The big question is whether the menu trade becomes two ways. Maybe in exchange for a Doritos taco shell at Taco Bell we will get lo mein at Mickey D's?

Only time will tell.


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3Comments
May 30, 2012 8:13PM
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"In the past two years, we have seen similar mad dashes into regions such as Brazil, Africa, India and China." Are you a smart reporter? Did you not finish school, or was geography just not your favorite subject? Don't pull a Sarah Palin, because Africa is a continent not a country. Your lumped it in a list of countries such as Brazil, India, and China. There are 7 continents in the world and Africa is the largest second to Asia. Africa has at least 47 countries in it! Don't be ignorant, MSN Money. Don't be one of the many foolish people who attempt to write smart articles but ultimately end up looking daft with their ignorant comments about "Africa." How is this even an educated article?
May 30, 2012 1:58PM
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How about opening one in Minnesota!!
May 30, 2012 12:36PM
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Many, many us companies are expanding their operations off shore. Obama and the democratic  Senate have made it a nightmare for US companies to expand  here in this environment of ridiculous regulations and over taxation. It's just starting, US companies have to compete on the world market and we do not have a business atmosphere conducive to growth. GM a good case in point..are you aware that 7 out of 10 vehicles they sell are not made in the US....But they took billions out of our pockets and are now spending it in China and South America expansions and start up plants...Should boggle your mind and make you realize how bad we need a knowledgeable business leader like Romney in the whitehouse

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