Dunkin’ Donuts Unfazed by the Impending Sugar Tax in South Africa

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Dunkin’ Donuts may be frowned upon by some people with its delectable offering of sugary donuts and syrupy iced coffees – some call their products as America’s poor dietary choice. However, that did not stop the company from bringing them to South Africa just recently. It was considered ironic that their store’s grand opening coincided with the country’s nutrition week, the time when the government encourages everyone to eat a healthy.

The first Dunkin’ Donuts store debuted on October 13th in Cape Town. The franchise is operated by the South African company Grand Parade Investments. Bloomberg reports that the franchisee plans to open five more stores by the end of the year and looks forward to expanding to at least 290 stores in the next 10 years. The company also has its eyes set on opening a Baskin-Robbins ice-cream franchise.

Dunkin’ Donuts is not the only U.S. fast-food brand that’s trying to carve out a niche in South Africa – businesses such as Pizza Hut, Yum!, and Starbucks have already entered the market scene in the past two years. However, its biggest competitor will be none other than the equally popular donut maker, Krispy Kreme, which now has five outlets in the country. So how does Dunkin’ Donuts plan to compete?

Alan Keet, the chief executive officer of Grand Parade Investments, says that they will be making brand awareness a priority. He told reporters that what they have is different because their coffee for one is imported, and that despite the brand name, it’s not just about donuts but the “coffee and bakery” package.

Although it has not expanded yet, the company may have to face one of its biggest challenges soon. There has been a rise in sugar-related diseases in the country like diabetes which prompted the health minister to propose a sugar tax in 2017. Dunkin’ Donuts on the other hand seems unfazed by the news and its officials already plan to enter Johannesburg in the near future.