[Document title] Contents Current State of Dunkin Donuts 2 The same products, yet so much more 2 Introduction 2 Challenges 3 Strengths 3 Rising industry 4 Future of Dunkin’ Donuts 5 Tables 6 References 7 Current State of Dunkin Donuts Dunkin Donuts is best known for its variety of delicious donuts and coffee, but over the years they expanded their product lines to include many different breakfast items and specialty coffee drinks. Over the past five years, the company developed a solid reputation for their coffee, and has managed to gain a loyal customer fan base. The company has been in operation since 1948, currently has approximately 6,500 outlets, and a goal to go to 15,000 outlets by the year 2020. The five main goals of Dunkin’ Donuts are as follows: (1) Grow relevant brands; (2) Expand globally; (3) Enhance the guest experience; (4) Continue their sustainability plan; and (5) Intensify domestic and international markets. The same products, yet so much more Mission statement:“Dunkin’ Donuts will strive to be the dominant retailer of high quality donuts, bakery products and beverages in each metropolitan market in which we choose to compete “ (DD IP Holder LLC, 2015). Krispy Kreme is a company in the industry that offers high quality doughnuts, and packaged sweets, among various kinds of beverages. Introduction The restaurant services industry has high levels of complexity and stiff competition, therefore, a potential acquisition of Krispy Kreme by Dunkin Donuts is identified. These two companies have great levels of potential, but face stiff competition from the other leading competitors previously mentioned. It would cost both Dunkin Donuts and Krispy Kreme a lot to expand to the levels of some of the competitors. The acquisition will most likely improve the companies’ performance and reduce the competition, thereby giving the two companies an opportunity to achieve their organizational objectives. Challenges There are some factors that could affect the growth and profitability for the restaurant services industry. The three most prominent risks are healthcare costs, mandatory wage hikes, and taxes. The new healthcare law, Affordable Care Act, has put significant pressure on the restaurant industry because a vast majority of the franchisees are small businesses. This is because these businesses tend to be labor intensive with a high number of young, part-time employees and are not typically associated with healthcare costs. However, the healthcare law will require these businesses to offer health care to employees which will drive up the healthcare costs. A second factor that affects the growth and profitability of the restaurant services industry is the mandatory wage hike. This recent federal proposal calls to raise the minimum wage from $7.25 to $10.10 over roughly two years. This is an increase in labor expenses of 40%, which will drive up operating expenses and will affect the ability of companies to have cash ava.

1. [Document title]
Contents
Current State of Dunkin Donuts 2
The same products, yet so much more 2
Introduction 2
Challenges 3
Strengths 3
Rising industry4
Future of Dunkin’ Donuts 5
Tables 6
References 7
Current State of Dunkin Donuts
Dunkin Donuts is best known for its variety of delicious donuts
and coffee, but over the years they expanded their product lines
to include many different breakfast items and specialty coffee
drinks. Over the past five years, the company developed a solid
reputation for their coffee, and has managed to gain a loyal
customer fan base. The company has been in operation since
1948, currently has approximately 6,500 outlets, and a goal to
go to 15,000 outlets by the year 2020. The five main goals of
Dunkin’ Donuts are as follows: (1) Grow relevant brands; (2)
Expand globally; (3) Enhance the guest experience; (4)
Continue their sustainability plan; and (5) Intensify domestic
and international markets. The same products, yet so much
more
Mission statement:“Dunkin’ Donuts will strive to be the
dominant retailer of high quality donuts, bakery products and
beverages in each metropolitan market in which we choose to

2. compete “ (DD IP Holder LLC, 2015).
Krispy Kreme is a company in the industry that offers high
quality doughnuts, and packaged sweets, among various kinds
of beverages. Introduction
The restaurant services industry has high levels of complexity
and stiff competition, therefore, a potential acquisition of
Krispy Kreme by Dunkin Donuts is identified. These two
companies have great levels of potential, but face stiff
competition from the other leading competitors previously
mentioned. It would cost both Dunkin Donuts and Krispy Kreme
a lot to expand to the levels of some of the competitors. The
acquisition will most likely improve the companies’
performance and reduce the competition, thereby giving the two
companies an opportunity to achieve their organizational
objectives. Challenges
There are some factors that could affect the growth and
profitability for the restaurant services industry. The three most
prominent risks are healthcare costs, mandatory wage hikes, and
taxes. The new healthcare law, Affordable Care Act, has put
significant pressure on the restaurant industry because a vast
majority of the franchisees are small businesses. This is because
these businesses tend to be labor intensive with a high number
of young, part-time employees and are not typically associated
with healthcare costs. However, the healthcare law will require
these businesses to offer health care to employees which will
drive up the healthcare costs. A second factor that affects the
growth and profitability of the restaurant services industry is
the mandatory wage hike. This recent federal proposal calls to
raise the minimum wage from $7.25 to $10.10 over roughly two
years. This is an increase in labor expenses of 40%, which will
drive up operating expenses and will affect the ability of
companies to have cash available to grow, expand, and hire
additional employees. The third major factor that affects the
growth of the industry is taxes. Recently, there has been
negotiation around the required tax rate for corporations in the
restaurant services industry. The higher the tax rate, the more

3. difficult it is for companies to have the needed cash flow to
grow, expand and hire new employees.Strengths
Krispy Kreme opened its doors in 1937 by selling their donuts
to local grocery stores. Today, Krispy Kreme is a leading brand
retailer who generates revenues from four different business
segments: Company Stores, Domestic Franchise, International
Franchise and KK Supply Chain. Krispy Kreme believes they
owe their success to brand recognition, and their original glazed
doughnuts. Another important factor they believe contributed to
their growth is strong community relationships and customer
loyalty. Krispy Kreme also contributes much of its success to its
extensive training program and support they offer to each and
every franchisee. From the beginning, Krispy Kreme was
committed to building relationships with guests and in
communities; and still support local communities through
fundraising programs and sponsorship of charitable events.
Krispy Kreme currently has 1,003 outlets in 24 different
countries worldwide. Revenues have increased by 9% from
121.6 million to 132.5 million. Their total assets and liabilities
is $352,713 as of February 2015 (KKD Corporation, 2015). Net
income has increased by 39% for 2014 and has declined by
nearly 19% thus far through 2015 (KKD Corporation, 2015).
The earnings per share directly correlates with these increases
and decreases. Please refer to Table 1 and Table 2 for Krispy
Kreme’s detailed Revenue and Income amounts, as well as
Earnings per Share amounts for the last three fiscal years.
Currently, Krispy Kreme is in the process of implementing
numerous strategic initiatives to allow growth and improve
profitability. The company is focused on accelerating global
growth, leveraging technology, enhancing their menu, and
maximizing brand awareness.[footnoteRef:1] [1: Information
provided in the Strengths section is taken from Krispy Kreme’s
10-K annual report.
KKD Corporation. (2015). Krispy Kreme. (E. online, Editor)
Retrieved July 14, 2015, from Financial Information :
http://investor.krispykreme.com/phoenix.zhtml?c=120929&p=ir

4. ol-
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TRVE9MCZTUURFU0M9U0VDVElPTl9FTlRJUkUmc3Vic2lkP
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]
Rising industry
The restaurant service industry is just under a $700 billion
industry and employs nearly 14 million people. It currently
does roughly $1.9 billion in sales on a typical day. This
industry is segmented into 3 services: commercial restaurant
services, noncommercial restaurant services, military restaurant
services. The largest by far is the commercial restaurant
services category which is grouped into 5 categories: Eating
places; bars and taverns; managed services; lodging places;
retail, vending, recreation, mobile. Some of the more well-
known competitors in the commercial segment of the industry
are McDonald’s, Burger King, Pizza Hut, Dunkin’ Donuts, Tim
Horton’s, Starbucks, and Krispy Kreme among others.
The restaurant industry has been trending up and is projected to
do $709 billion in sales for 2015; which is nearly a 4% increase
in sales over 2014. The 2015 projection is the sixth consecutive
year of growth in the restaurant sales industry. The industry is
also projected to create roughly 1.7 million new restaurant jobs
in the next 10 years, with 15.7 million employees by the year
2025. This projection is in line with our goal of increasing our
outlets by the year 2020. Future of Dunkin’ Donuts
Please see Table 3 on the growth of the company since 2012.
The profit of the company has increased by 7.8% over the past 2
years, clearly seen in table 4. This leaves the company in a
great position to expand if the want is there. “The acquisition of
Krispy Kreme by Dunkin Donuts will certainly make sense,
since the strengths of the two companies will give the acquirer
an edge in the highly competitive industry” (Hubbard, 1999).
Some of the benefits that will emanate from the acquisition are
as follows: Dunkin Donuts will increase its diversity of product

5. lines offered in the industry, and further improve the quality of
the staff through the robust training program of Krispy Kreme.
The cost to expand will be reduced and thus enable the
companies to effectively compete and capture a larger market
share of the restaurant services industry. “The acquisition of
Krispy Kreme by Dunkin Donuts will provide additional
flexibility necessary for success in the complex and highly
competitive restaurant services industry” (Hubbard, 1999). We
can begin this process for the 2nd quarter of the next fiscal
year. Tables
Table 1: Krispy Crème income
Revenue and Income
Year Ended
February 1, 2015
February 2, 2014
February 3, 2013
Revenues
490,033
460,331
435,843
Net Income
30,060
34,256
20,779
Note: Retrieved from Krispy Kreme form 10-K annual report.
Copyright 2015, Edgar online, inc. by Krispy Kreme
Table 2: Krispy Crème EPS
Earnings Per Common Share:
Basic
0.45
0.51
0.31
Diluted
0.44

6. 0.48
0.30
Note: Retrieved from Krispy Kreme form 10-K annual report.
Copyright 2015, Edgar online, inc. by Krispy Kreme
Table 3: Dunkin Brand growth
Note. Retrieved from Dunkin’ Brands form 10-K annual report.
Copyright 2015, Edgar online, inc. by Dunkin’ Donuts
Table 4: income
Note. Retrieved from Dunkin’ Brands form 10-K annual report.
Copyright 2015, Edgar online, inc. by Dunkin’ Donut
References
CIT Group. (Restaurant Trends, 2014). 2014. Retrieved July 13,
2015, from Commercial Financing Trends
http://www.cit.com/perspectives/executive-insights/commercial-
financing-trends/index.htm.
DD IP Holder LLC. (2015). Dunkin Donuts. Retrieved July 13,
2015, from Company Snap Shot:
http://www.dunkindonuts.com/dunkindonuts/en/company.html
Hubbard, N. (1999). Acquisition Strategy and implementation.
West Lafayette: Ind:Ichor Business Books. Retrieved July 14,
2015
kimes, S. E., & Macmillan, P. (2010, December 18). The Future
of Distribution Management in the Restaurant Industry.
Retrieved July 13, 2015, from http://www.palgrave-
journals.com/rpm/journal/v10/n2/full/rpm20111a.html
KKD Corporation. (2015). Krispy Kreme. (E. online, Editor)
Retrieved July 14, 2015, from Financial Information :
http://investor.krispykreme.com/phoenix.zhtml?c=120929&p=ir
ol-
SECText&TEXT=aHR0cDovL2FwaS50ZW5rd2l6YXJkLmNvbS
9maWxpbmcueG1sP2lwYWdlPTEwMTkwNjU1JkRTRVE9MCZ
TRVE9MCZTUURFU0M9U0VDVElPTl9FTlRJUkUmc3Vic2lkP
TU3
Maze, J. (2013, September 10). Restauant Industry Gets More
Competitive. Retrieved July 13, 2015, from Restaurant Finance
Monitor: http://www.restfinance.com/Restaurant-Finance-

7. Across-America/September-2013/Restaurant-Sales-Still-Stuck-
In-The-Mud/
Maze, J. (2015, January 2015). NRA: 2015 Restaurant Sales to
Grow 3.8%. Retrieved July 14, 2015, from Nation's Restaurant
News : http://nrn.com/finance/nra-2015-restaurant-sales-grow-
38
National Restaurant Association. (2012-2015). Industry Facts at
a Glance. Retrieved July 13, 2015, from National Restaurant
Association: http://www.restaurant.org/News-
Research/Research/Facts-at-a-Glance
National Restaurant Association. (2012-2015). The Front
Burner. Retrieved July 2013, 2015, from National Restaurant
Association: http://www.restaurant.org/advocacynal Restaurant
Association; Retrieved on 7/13/2015
National Restaurant Association. (2014, January 16). 2014
Restaurant Industry Forecast Reveals Economic. Retrieved July
14, 2015, from Workforce and Consumer Food and Technology
Trends:
http://www.restaurantnewsresource.com/article75901National_R
estaurant_Association_s______Restaurant_Industry_Forecast_R
eveals_Economic__Workforce_and_Consumer_Food_and_Techn
ology_Trends.html
National Restaurant Association. (2015). Forecast Summary.
Retrieved July 13, 2015, from National Restaurant Association:
http://www.restaurant.org/Downloads/PDFs/News-
Research/research/ForecastExecSummary2015-FINAL.pdf
National Restaurant Association. (2015). Pocket Fact Book.
Retrieved July 14, 2015, from National Restaurant Association:
http://www.restaurant.org/Downloads/PDFs/News-
Research/research/Factbook2015_LetterSize-FINAL.pdf
Nations Restaurant News. (2013, May 16). Issues Keeping
Industry Leasers Up At Night. Retrieved July 14, 2015, from
Regulation Nation: http://nrn.com/government/regulation-
nation-issues-keeping-industry-leaders-night
New York Times. (2002, September 23). New York Times.
Retrieved July 13, 2015, from William Rosenberg, 86, Founder

8. of Dunkin Donuts:
http://www.nytimes.com/2002/09/23/business/william-
rosenberg-86-founder-of-dunkin-donuts.html
The Boston Globe. (2014, September 17). The Boston Globe.
Retrieved July 13, 2015, from The Secret World of the Dunkin
Donuts Franchise Kings:
http://www.bostonglobe.com/magazine/2014/09/17/the-secret-
world-dunkin-donuts-franchise-
kings/pb2UmxauJrZv08wcBig6CO/story.html#
Watrous, M. (2015, June 26). Five Things to Know About the
State of the Restaurant Industry. Retrieved July 14, 2015, from
Food Business News:
http://www.foodbusinessnews.net/articles/news_home/Food-
Service-
Retail/2015/06/Five_things_to_know_about_the.aspx?ID=%7B2
6FB1E23-DAFC-4C35-A20A-7AC0B58835EF%7D
ACCT600 MAFM CAPSTONE
{Session}
{Instructor Name}
Team Name
Team Members
[Pick the date]
Table of Contents
1 EXECUTIVE SUMMARY 1

9. 2 INDUSTRY OVERVIEW 1
2.1 Industry Snapshot 1
2.2 Organization and Structure 1
2.3 Background and Development 1
2.4 Current Condition 1
2.4.1Exhibit 1 1
2.4.2Exhibit 2 1
2.4.3Key Statistics for 2010: Industry 1
2.4.4Exhibit 3 1
3 INDUSTRY LEADERS 1
3.1 Competitor 1 1
3.2 Competitor 2 1
3.3 Competitor 3 1
3.4 Competitor 4 1
3.4.1Revenue / Income History 1
3.5 Competitor 5 1
3.5.1Revenue / Income History 1
3.6 Competitor 6 1
3.6.1Revenue / Income History 1
3.6.2Exhibit 4 1
3.6.3Exhibit 5 1
3.7 Corporate Overview 2
3.7.1Table 1 – Revenue and Income (in thousands) 2008
through 2010 2
3.7.2Table 2 – EPS 2008 through 2010 2
3.7.3Exhibit 6 2
4 SWOT 2
4.1 Strengths 2
4.2 Locations 2
4.3 Growth 2
4.4 Cost 2
4.5 Range of Merchandise 2
4.6 Weaknesses 2
4.7 Ability to Gain Market Share 2
4.8 Profitability is Vulnerable to Cost Increases 2
4.9 Pressure from Competitors May Reduce Their Sales and

10. Profits 2
4.10 Opportunities 2
4.11 Threats 2
4.12 New Entrants 2
4.13 Concentration 2
4.14 Product Differentiation 2
4.15 Legal Problems 2
4.16 Substitute Products 2
5 CORPORATE CULTURE2
5.1 Business Strategy 3
6 ORGANIZATION AND CORPORATE ISSUES 3
6.1 Employees 3
7 CAPITAL STRUCTURE 3
7.1 Assets 3
7.2 Lease Agreements 3
7.3 Accounts Receivable 3
7.4 Inventories 3
7.5 Depreciation 3
7.6 Assets Categories 3
7.7 Cash and Cash Equivalents 3
7.8 Short Term Investments 3
7.9 Long-lived assets 3
7.10 Deferred Tax Asset 3
7.10.1 Table 3 – Property, Plant and Equipment past Two
Years 3
7.11 Goodwill 3
7.12 Other Assets 3
7.13 Expansion Plans 3
7.14 Liabilities3
7.14.1 Table 4 – Contractual Obligations 3
7.15 Operating Lease Obligations 3
7.16 Capital Lease Obligations 3
7.17 Credit Agreement 4
7.18 Revenue Bond Financing 4
7.19 Interest on Long-Term Borrowings 4
7.19.1 Table 5 – Commitments 4

11. 7.20 Letters of Credit and Surety Bonds 4
7.21 Freight Contracts 4
7.22 Technology Assets 4
7.23 Derivative Financial Instruments 4
7.23.1 Tables 6 and 7 – Current and Other Liabilities 2009
and 2010 4
7.24 Other Current Liabilities 4
7.25 Other Long-Term Liabilities 4
7.25.1 Table 8 – Other Long-Term Liabilities 4
7.26 Long-Term Debt 4
7.26.1 Table 9 – Long-Term Debt 4
7.27 Deferred Compensation Plan 4
7.28 Income Taxes 4
7.28.1 Table 10 – Provision for Income Taxes 2008 through
2010 4
7.28.2 Table 11 – Deferred Tax Asset 4
7.28.3 Table 12 – Unrecognized Tax Benefits 4
7.29 Zero Balance Line of Credit and Risk Hedging 4
8 PERFORMANCE MEASUREMENTS 4
8.1 Asset Utilization 4
8.1.1Table 13 – Sales to Working Capital 2008 through 2010 4
8.1.2Exhibit 7 5
8.1.3Exhibit 8 5
8.1.4Table 13 – Total Shareholder’s Equity 2008 through 2010
5
8.1.5Exhibit 9 5
8.2 Operating Performance 5
8.2.1Exhibit 10 5
8.2.2Exhibit 11 5
8.3 Return on Equity (ROE) 5
8.3.1Exhibit 12 5
8.4 Earnings Per Share 5
8.4.1Exhibit 13 5
8.5 Cash Flow 5
8.5.1Exhibit 14 5
8.5.2Exhibit 15 5

12. 8.6 Capital Structure and Solvency 5
8.6.1Exhibit 16 5
8.6.2Exhibit 17 5
8.6.3Exhibit 18 5
8.6.4Exhibit 19 5
8.7 Net Profit Margin 5
8.7.1Exhibit 20 5
8.8 Operating Profit Margin 5
8.8.1Exhibit 21 5
8.8.2Exhibit 22 5
8.9 Market Performance 5
8.9.1P/E Ratio 6
8.9.2Exhibit 23 6
8.10 Capitalization Rate 6
8.10.1 Exhibit 24 6
9 FINANCIAL REPORT ANALYSIS 6
9.1 Consolidated Financial Statements 6
9.2 Auditing 6
9.3 Analysis of Financials 6
9.3.1Exhibit 25 6
9.4 Sales 6
9.5 Third-Quarter Results 6
9.6 39-Week Period Results 6
9.7 Financial Update 6
9.8 GUIDANCE 6
10 CONCLUSION AND RECOMMENDATION 6
10.1 Similar Acquisitions6
10.2 Combined Value 6
10.3 Anticipated Financial Performance 6
11 WORKS CITED 6
12 APPENDIX 6
12.1 Financial Report 6
12.2 Compensation of Executive Officers 7
12.2.1 Table 14 – Compensation to Executive Officers 7
12.3 Director Compensation 7
12.3.1 Table xx – Director Compensation 7

13. 12.3.2 Table xx 7
12.4 Compensation Committee7
12.5 Incentive Bonuses 7
12.5.1 Table xx 7
12.6 Overall Payroll 7
12.7 Benefit Package 7
12.8 Biographies of the Consultants {the team} 7
12.9 The following names list {company} directors’ nominees:
7
12.10 Committees of the Board of Directors 7
12.11 Footnotes from the most recent Annual Report7
12.11.1 Note x: 7
Page i
EXECUTIVE SUMMARY INDUSTRY OVERVIEW
Industry Snapshot Organization and Structure
Background and Development Current Condition
Exhibit 1
Exhibit 2
Key Statistics for 2010: Industry
Exhibit 3 INDUSTRY LEADERS Competitor 1 Competitor
2 Competitor 3 Competitor 4
Revenue / Income History Competitor 5
Revenue / Income History Competitor 6
Revenue / Income History
Exhibit 4

14. Exhibit 5 Corporate Overview
Table 1 – Revenue and Income (in thousands) 2008 through
2010
Table 2 – EPS 2008 through 2010
Exhibit 6 SWOT Strengths Locations Growth Cost Range
of MerchandiseWeaknesses Ability to Gain Market Share
Profitability is Vulnerable to Cost Increases Pressure
from Competitors May Reduce Their Sales and Profits
Opportunities Threats New Entrants Concentration
Product Differentiation Legal Problems Substitute
Products CORPORATE CULTUREBusiness Strategy
ORGANIZATION AND CORPORATE ISSUES
Employees CAPITAL STRUCTURE Assets Lease
Agreements Accounts Receivable Inventories
Depreciation Assets Categories Cash and Cash
Equivalents Short Term Investments Long-lived assets
Deferred Tax Asset
Table 3 – Property, Plant and Equipment past Two Years
Goodwill Other Assets Expansion Plans Liabilities
Table 4 – Contractual Obligations Operating Lease
Obligations Capital Lease Obligations Credit Agreement
Revenue Bond Financing Interest on Long-Term
Borrowings
Table 5 – Commitments Letters of Credit and Surety Bonds
Freight Contracts Technology Assets Derivative
Financial Instruments
Tables 6 and 7 – Current and Other Liabilities 2009 and 2010
Other Current Liabilities Other Long-Term Liabilities

15. Table 8 – Other Long-Term Liabilities Long-Term Debt
Table 9 – Long-Term Debt Deferred Compensation Plan
Income Taxes
Table 10 – Provision for Income Taxes 2008 through 2010
Table 11 – Deferred Tax Asset
Table 12 – Unrecognized Tax Benefits Zero Balance Line of
Credit and Risk Hedging PERFORMANCE MEASUREMENTS
Asset Utilization
Table 13 – Sales to Working Capital 2008 through 2010
Exhibit 7
Exhibit 8
Table 13 – Total Shareholder’s Equity 2008 through 2010
Exhibit 9 Operating Performance
Exhibit 10
Exhibit 11 Return on Equity (ROE)
Exhibit 12 Earnings Per Share
Exhibit 13 Cash Flow
Exhibit 14
Exhibit 15 Capital Structure and Solvency
Exhibit 16

16. Exhibit 17
Exhibit 18
Exhibit 19 Net Profit Margin
Exhibit 20 Operating Profit Margin
Exhibit 21
Exhibit 22 Market Performance
P/E Ratio
Exhibit 23 Capitalization Rate
Exhibit 24 FINANCIAL REPORT ANALYSIS Consolidated
Financial Statements Auditing Analysis of Financials
Exhibit 25 Sales Third-Quarter Results 39-Week
Period Results Financial Update GUIDANCE
CONCLUSION AND RECOMMENDATION Similar
Acquisitions Combined Value Anticipated Financial
Performance WORKS CITED APPENDIX Financial
Report Compensation of Executive Officers
Table 14 – Compensation to Executive Officers Director
Compensation
Table xx – Director Compensation
Table xx Compensation CommitteeIncentive Bonuses
Table xxOverall Payroll Benefit Package Biographies of
the Consultants {the team} The following names list

17. {company} directors’ nominees: Committees of the Board of
Directors Footnotes from the most recent Annual Report
Note x:
Page 1 of 12