Oh, Dunkin Donuts. The day you opened your doors next to Noodles & Co. on Kirkwood, I predicted your doom. Did you forget to fully research ye ole Bloomington? Researching (#1) how large our population is, and (#2) how much of our population likes coffee and donuts (um, 99%) is just not enough for a town like Bloomington. First of all, I feel pretty comfortable stating that Dunkin’s prime time must be morning. I also feel pretty comfortable saying that people are more than willing to spend big $$$ on coffee and donuts in the morning. But there’s more you need to know!
Ok, if Dunkin Donuts had hired me as a consultant, here’s what they would have heard:
- There are two MAJOR competitors within one block of the proposed location. Does Bloomington have a big enough population to support three in one block? Probably not, but this is just a small observation.
- Does Bloomington, in general, support corporate businesses? Actually, yes / somewhat, but a good local joint will take away a lot of your business. Don’t expect to come in and take a chunk out of the local businesses’ devoted clienteles. It ain’t gonna happen. If the local business sucks, then you have a shot. In this case, you don’t.
- What is the foot traffic around your proposed business location during your peak hours (i.e. morning)? Um, nil. Trust me, I work right across the street. There are days I walk into work without seeing another human being on the street. Not what you’d expect, I know… but something you’d learn with a little research.
- But, you say, there 40K students on campus and they love coffee and donuts! Yes, but they are almost NEVER in this location in the morning. They do venture over for lunch…but even then the population of students eating lunch in this location is fairly small in comparison to the student population. This is because there are VERY few classrooms near this location (it’s mostly administrative buildings).
- Lastly, did you actually SEE the proposed rent from your landlords??? Perhaps you missed one zero in it?
Just think: I would have only charged you $1,000 for my consultation and you would have saved at least $500,000. Sometimes paying for market research is worth it J.
Other businesses (I think are) doomed and why:
- Campus Candy (location is WAY TOO expensive for their small revenues)
- Panda Express (too many competitors, food sucks, rent too high)
- B Boutique, Hey Nineteen, and any girly business with the name “Bella” in it (the overhead just trumps your potential earnings, too much competition)
- Sweet Grass (not enough sales, renting too much unused square footage)
- Finches (many people will disagree with this, but they just don’t get enough business)
- 90% of Bloomington's bakeries (because there have been 30 other bakeries in your location before you…so duh, don’t do it!)
- That new soup business on the square (for every reason listed above and a million more!)
Ok, it’s important to note that there are always some businesses that stay open without making a profit…meaning the owner pretty much finances it on his / her own because he / she loves it, OR because he / she doesn’t know how to do the books, therefore he / she doesn’t realize they are actually losing money (until it’s too late). Here are a few that I think fit this bill:
- O’Child! Darling store that the owners must feel very passionately about, but there’s no way they make a decent profit with that product and that rent.
- Baked! (a cookie store), Green Bananas (a clothing store), and this hippy store on Indiana that I don’t know the name of: I think these businesses make money, but not because of the product they advertise. Haha.
What are some others, Bloomingtonians?
Images from here.
Images from here.