Dunkin' Brands plans big-scoop entry into SA

Emerging markets, with their burgeoning and brand aspirant middle classes, have become the target of international companies seeking enhanced growth.

Baskin Robbins has a presence in more than 50 countries outside the US including India, China and Russia. Since it was founded in 1945, it has introduced more than 1,000 flavours of ice cream including Strawberry Millefeuille, Wild 'n Reckless Sherbert and Peppermint Fudge Ribbon.

Dunkin Brand's vice-president of international development, Jeremy Vitaro, said last week the growth of the market coupled with SA's population profile offered an opportunity for Baskin Robbins. "In SA, ice cream is primarily known within the confines of supermarkets. There are not many companies specialising in hard-scoop ice cream and ice cream cakes. This is a big and untapped opportunity, designed to suit regional and master franchising."

The South African ice cream market will be worth R3.39bn this year, according to research company Datamonitor.

Ola SA, a division of Unilever, and Dairymaid-Nestlé have the biggest market share of the SA ice cream market. Häagen-Dazs has five stores across SA and its ice creams are sold at retailers and garage forecourts.

Franchisees

Nasdaq-listed Dunkin' Brands is in the process of recruiting franchisee partners to develop the Baskin Robbins brand in SA. "We will be very involved from an operations, training, supply chain and field perspective," Vitaro said.

"First entries would be in Cape Town, Johannesburg, Durban and Bloemfontein. Eighteen months after the roll-out of Baskin Robbins, we will open Dunkin' Donuts," he said.

Baskin Robbins' first store in SA will open next year.

Dunkin' Brands runs about 473 Baskin Robbins ice-cream parlours in India through a franchise agreement with Graviss Group. It also has three Dunkin' Donuts stores there and is aiming to open up to 100 over the next five years.

Kahala Corporation, one of the US's largest franchising companies, is also eyeing Africa through its Cold Stone Creamery ice cream brand.

It opened an outlet in Nigeria in September last year after signing a master franchise agreement with Ivybridge Trading. It wants to open nine stores in the region over the next five years.

"Expanding into emerging markets is a major priority in Kahala's development plans," said Michael McGill, president of Kahala's international division. The Cold Stone Creamery brand is in several of the world's largest emerging markets including Brazil, China, Indonesia and Turkey.

Cold Stone Creamery, which operates more than 1,500 locations in 20 countries, differentiates its product by offering smooth handcrafted ice cream. It also sells other ice cream related products.

"Kahala is currently looking to expand into several other African countries," McGill said.

Source: Business Day via I-Net Bridge