CNBC Interviews Dunkin's CEO

Nigel Travis, CEO of Dunkin Brands, Inc., appeared on CNBC Thursday morning to discusses the company's outlook. He brought with him a huge Christmas box that contained thousands of gift cards to give New York consumers.

The bakery chain has been on ground zero of the coffee wars, a value fight between itself, McCafe and Starbucks. When asked if the high unemployment was dampening sales because more people were not going to work, Travis didn’t share numbers but said, “Unemployment is something we are concerned about.” Sitting with a cup of Dunkin’ coffee and a donut, the CEO interjected, “We haven’t really seen a decline [in same-store sales].”

Travis declared, “We have a great relationship with our franchisees.” He added, “We push our franchisees the whole time to get their operations better and better. That’s the major job of someone like me.”

But there has been a very large group of franchisees who have not been happy with Dunkin’ Brands, and do not characterize their relationship as “a great relationship.” Franchise Attorney Robert Zarco declared a few months ago that Dunkin’ is the most litigious franchise chain in the industry, having some 350 lawsuits against its franchisees. And the new CEO has yet to meet with the largest association of its franchisees, the Dunkin’ Donut Independent Franchise Owners, an association that represents now nearly four thousand of its franchises, and growing.

When asked about why donut chain Krispy Kreme crashed in the number of their outlets, Travis speculated, “It’s very easy to grow too fast, too quickly. I’m not saying that’s what they did.” He added for Dunkin’, “We have very steady growth.”

Some have had difficulty seeing the franchisor focusing on slow and controlled development. “I wonder what they told the developers who were buying hundred store SDA’s [store development agreements] under the rapid development plans,” a franchisee queried of Blue MauMau. A number of those SDAs have aborted, most notably the Northern Texas SDA, operated under the Zale family.