A year after hatching a plan to replicate the Donut Bar brand beyond its downtown San Diego location, the company has awarded franchises for nearly a dozen new locations, including three in San Diego County.
The franchisees, who will be spending from $300,000 to $600,000 apiece to open their doughnut-centric stores, were culled from 1,600 applicants, said Donut Bar co-owner Santiago Campa.
He expects nine of the 11 new locations to open by the end of this year. Nearly all of the leases are finalized, and all of the planned franchises should be complete by next summer, Campa said.
In San Diego County, plans are in the works for new Donut Bars in Oceanside, Eastlake and Pacific Beach. Outside the county, Donut Bar’s affliate, Sweet Assets Franchise Group, plans to open shops in Temecula, Scottsdale, Riverside, Pasadena, North Hollywood/Burbank, Tucson, Sacramento, and Anaheim.
“It was very hard to narrow down all the applications,” said Campa, who initially hired a franchising consultant last year to advise him and his partner, Wendy Bartels, on how to proceed. “A lot of people have money but the biggest thing I wanted to make sure of is that they have the same culture as Donut Bar, from the quality control to the person who will pick up a broom and mop the floors. And we also wanted people who also understand customer service, our No. 1 priority.”
Like the downtown San Diego location, Donut Bar franchises will incorporate wine and craft beer offerings on weekend nights, along with fresh-baked doughnuts. The only location that will not do so is in Eastlake, Campa said. During the summer months, the locations will likely be set up to reopen in the evening hours for as many as five nights a week, he added.
The selected franchisees, he said, represent a range of experience, from people who have operated multi-unit franchises to newbies, who don’t have franchise experience but who have been in business for themselves.
For the most part, the shops will occupy vacant spaces in existing strip malls, although two — the Anaheim and Riverside Donut Bars — will be built from the ground up, Campa said.
The role of Sweet Assets, which will collect a percentage of sales from the stores, will be to train the franchisees, provide them with marketing support, and help with menu development and quality control.
Artisan-style doughnuts have grown increasingly popular, and there is no shortage of gourmet shops selling such confections. While Campa does not seem overly concerned about the expansion, he acknowledged that he is making a point of not moving too quickly. He said he does not plan on searching for additional franchisees until the end of the year.
“We are worried about saturation, which is why we are being very selective.” he said. “We’re not going to put them where they’re competing with one another. And I won’t ever put one where it would be next to a mom and pop doughnut shop.
“But I think our concept is tried and true. We’ve been around five years, and I think we have a unique product that can’t be mimicked too much.”