Dunkin' Donuts is back in business in Minnesota

The Minnesota hole in Dunkin' Donuts franchise map has been filled — well ahead of corporate projections.

The nation's largest doughnut-and-coffee chain, with more than 7,000 locations nationwide, announced this week the opening of a Dunkin' Donuts at the Kahler Grand Hotel in downtown Rochester. The location ends a nearly decadelong absence from the state.

The franchisee, Rochester Retail Services, added that this is just the beginning, that it plans to open five free-standing Dunkin' Donuts in the Rochester area over the next several years. The first Rochester outlet, at 15 1st Av. SW., has about 40 employees.

Grant Benson, Dunkin' Donuts vice president for franchising, said it is also targeting Minneapolis, Mankato and Duluth for outlets "in the years to come."

The push into Minnesota is part of a national expansion that saw the chain make inroads last year in Salt Lake City, Dallas, Houston and other markets far from its Massachusetts headquarters.

In January, Steve Rafferty, senior director of U.S. franchising for Dunkin' Brands, said he wasn't expecting a return of Dunkin' Donuts for 12 to 18 months.

The return of Dunkin' Donuts ends a decadelong absence from the Twin Cities, after its stores either closed or went independent. An Austin franchise was the last one in Minnesota. That locale lowered the Dunkin' Donuts sign in 2005 and became the Donut Connection.

In 2008, Dunkin' Donuts announced plans to sell about 100 franchises in Minnesota. That effort never materialized because the company realized it didn't have the proper supply chain or training infrastructure in place for such an ambitious expansion, Rafferty said.

This time around, he added, Dunkin' Donuts is better positioned geographically for reclaiming Minnesota and supporting franchise efforts now that the company has a stronger presence in the Midwest and elsewhere beyond its East Coast comfort zone.

Dunkin' Donuts also has been steadily expanding its sandwich and wrap offerings of late in an effort to counter competitors such as the Starbucks and Caribou national chains.

Paul Walsh • 612-673-4482