Discuss the pros and cons of Jamba Juice’s strategy and how it compares to that of Dunkin’ Donuts. What similarities are there between the two companies in term of their growth strategies? Discuss.
INFORMATION THAT MAY BE HELPFUL WHILE ANSWERING:
Jamba Juice's humble beginnings started in 1990 in San Luis Obispo, California, when cycling enthusiast, Kirk Perron, opened his first store. Having now grown to over 760 locations, mostly in the United States, Jamba, Inc. plans to broaden its reach through franchising with a mix of 80-90% franchised stores with 10-20% company owned. The company sees potential for 2,700 domestic and 1,000 international store locations. “We are going for an asset-light business model, with a focus on brand development,” says its CEO, James White.
Owners of the international chain of company-owned and franchised yogurt and smoothie stores, Yogen Fruz, have invested $20 million in the firm. Its CEO Michael Serruya says his company's goal is to provide Jamba, Inc. with insights into global franchise operations. Jamba's accelerated growth plans include worldwide franchising, expanding in-store products beyond smoothies, complimentary acquisitions, and the sale of Jamba-branded consumer packaged goods beyond its stores—things like fruity coconut water, fruit cups, and even a frozen home-smoothie kit for kids.
Jamba's strategy is to diversify from a smoothie-only shop to a line of wraps, sandwiches, salads, and flatbreads. So far, so good. The company's expanded menu includes fruit and vegetable smoothies, Fit and Fruitful smoothies with a weight burner boost to support weight management goals, Whirl'ns Frozen Yogurt, Probiotic Yogurt blends, and coconut water infused smoothies. Nondairy, nongluten vegan items are included on its menu as well.
Viewing it as a natural fit to the breakfast market, Jamba acquired an Oprah Winfrey favorite—Talbott's Tea. The company believes premium, all-natural hot beverages will be a great complement to its existing lines. So far, with all of these growth strategies in place, same-store comparable sales at this cold beverage company are turning out to be very “hot.” Is Jamba ready to take on the fast-developing market for beverage alternatives?}