By Joseph Morales

The NYC Subway is the lifeblood of New York City and one of the primary ways people get around. In 2022, 3.2 million people rode the subway daily in 2022 despite hybrid/remote work being more common. While the subway is often the best way to travel, many New Yorkers hate riding it due to delays, cleanliness and a slew of other issues. On top of that, New Yorkers are considered by some to be among the most stressed out people in America. A study from the research firm William Russell considered the NYC the most stressed city in America for several reasons including its high cost of living. A TimeOut article on the topic even mentioned “perennial subway delays” in a sentence on stressors that are just so common here in our city. You can check out that article here: ​​https://www.timeout.com/newyork/news/nyc-is-officially-the-most-stressed-out-city-in-the-united-states-011222

                    Given these circumstances, you might think New Yorkers would love a coffee, donut or even bacon egg and cheese sandwich to start their work day. It turns out, Dunkin Donuts has this figured out, with locations adjacent to many subway stations throughout the boroughs. They even have three locations within Penn Station and another one in Fulton Center. 

                    These strategic locations are no accident and Dunkin’s franchise selection strategy along with other aspects of its business allow it to take advantage of locations adjacent to transit. For one, out of the donut chain’s five criteria for selecting locations, four of them are directly connected to the transportation infrastructure around them. These include an available drive thru, one parking space per three seats, an easy entrance and exit and having a highly visible location. As for drive thrus and parking spaces, these are likely not weighed as heavily in New York City due to the high percentage of residents that do not drive. However, subway stations definitely support the latter two, as stations tend to be in walkable locations with high foot traffic. 

                  In addition to location itself, the cost and space required to open a Dunkin Donuts is considerably less compared to other fast food chains. This allows the chains to multiply faster in the areas both Dunkin and franchisees see fit. As for cost, the initial investment for a Dunkin Donuts can be anywhere from $121,400-$1,809,500 according to the company website. This is in comparison with $297K-$2.1M for Pizza Hut, $575,600 to $3,370,100 for Taco Bell and $1,314,500 and $2,313,295 for McDonalds. Lower costs are especially beneficial for Dunkin Donuts franchisees given what may be higher rents near subway stations. 

                    Outside of initial costs, Dunkin locations are generally much more flexible as far as space is concerned than other fast food restaurants. Since many Dunkin customers take coffees and small treats to go, there can be varyings eating levels if there is seating at all. There are even Dunkin Donuts locations that function primarily as kiosks such as the one in Fulton Center. Others are standing room only locations such as the one in Marble Hill, Manhattan, and some offer limited seating such as the one on Eastern Pkwy adjacent to the Franklin Av-Medgar Evers College(2,3,4,5) station in Brooklyn.  On the other hand, other chains such as McDonalds and Taco Bell need a certain amount of seating and space to accommodate their respective functions as a lunch/dinner spot. In fact, Taco Bell only recently opened a new restaurant variant known as Taco Bell Cantina that is designed to better spatially accommodate urban areas. Taco Bell Head of Public Relations Matt Prince told CNBC in 2019, “So typically when you think of Taco Bell’s you think of suburban and rural areas with drive thru. These are very different. These are in walkable downtown spaces.“ He also stated, “We want to make sure that they feel like they’re part of the community that they’re in and so people come in and feel like they have a unique experience.” With flexible locations in urban areas, Dunkin Donuts had already achieved for years what Taco Bell set out to achieve in 2019 with its Taco Bell Cantina locations.

                    While Dunkin’s business model often brings it near subway stations, what has really driven Dunkin’s subway-side boom is what matters most to businesses. This business driver is indeed the customer! Dunkin Donuts are unique in that its business caters directly to the needs of the commuter. In the morning, a subway rider who just had a long commute might want to grab a cup of coffee or a small breakfast item. At the end of the day, a commuter might be in the mood for a donut or one of the chain’s other dessert offerings. The same cannot be said for Popeyes, Taco Bell or most other fast food chains, that specialize in a smaller range of meal options. The closest chain to Dunkin Donuts as far as product diversity is McDonalds with its all-day breakfast as well as lunch/dinner options. However, besides some breakfast items, most of its products are associated with full meals rather than quick bites that could be had before getting on the train. Additionally, while subway stations can help drive traffic for any fast food establishment, these businesses often need other business drivers such as nearby employment and recreational destinations. On the other hand, Dunkin Donuts can cater to a commuter in any community.

                          As Dunkin Donuts is really popular amongst New Yorkers, it is interesting to think about what allows a business to perform well in any given market. With Dunkin, it’s impressive how their restaurant concept fits perfectly into the needs of New Yorkers and the challenges of operating a business in the city. Thanks to the chain’s versatility, it has been successful near NYC subway stations and across the United States. As a result, Dunkin Donuts has told Americans since its 2006 rebranding, “America Runs On Dunkin!”

Works Cited

CNBC. “Why Americans Love Taco Bell.” YouTube, 19 April 2019, https://www.youtube.com/watch?v=_eQ2Dry2R_8. Accessed 26 February 2024.

Dunkin Donuts. “Dunkin’ locations in New York.” Dunkin’ locations, https://locations.dunkindonuts.com/en/ny/new-york. Accessed 25 February 2024.

Dunkin Donuts. “Explore Our Excitin’ Quick Service Restaurant Franchise Opportunities.” Dunkin’ Franchising, https://www.dunkinfranchising.com/franchise-opportunities/. Accessed 25 February 2024.

“Dunkin’ Donuts Launches New Advertising Campaign “America Runs on Dunkin'(SM)” | Dunkin.’” Dunkin Donuts, 10 April 2006, https://news.dunkindonuts.com/news/dunkin-donuts-launches-new-advertising-campaign-america-runs-on-dunkin-sm. Accessed 26 February 2024.

“McDonald’s Franchise Cost & Opportunities 2024 | Franchise Help.” FranchiseHelp, 2024, https://www.franchisehelp.com/franchises/mcdonalds/. Accessed 26 February 2024.

Metropolitan Transportation Authority. “Subway and bus ridership for 2022 – New York City Transit.” MTA, 2023, https://new.mta.info/agency/new-york-city-transit/subway-bus-ridership-2022. Accessed 25 February 2024.

“Pizza Hut Franchise Cost & Opportunities 2024 | Franchise Help.” FranchiseHelp, 2024, https://www.franchisehelp.com/franchises/pizza-hut/. Accessed 26 February 2024.

Rahmanan, Anna. “NYC is officially the most stressed-out city in the United States.” TimeOut, 12 January 2022, https://www.timeout.com/newyork/news/nyc-is-officially-the-most-stressed-out-city-in-the-united-states-011222. Accessed 25 February 2024.

Ramos, Bethany. “Dunkin’ Donut Franchise – Requirements and Process.” BuyerZone, https://www.buyerzone.com/professional-services/business-franchises/ar-dunkin-donuts-franchise/. Accessed 25 February 2024.

“Taco Bell Franchise Cost & Opportunities 2024 | Franchise Help.” FranchiseHelp, 2024, https://www.franchisehelp.com/franchises/taco-bell/. Accessed 26 February 2024.