If America runs on Dunkin’, then the Midwest runs on Heartland Restaurant Group [HRG]. Almost 20 years in, the group oversees 80 Dunkin’ locations across Southwestern Pennsylvania, West Virginia, Ohio, and Maryland, making it one of the beverage chain’s largest operators.
Fresh on the scene in 2008, HRG was given the largest franchise development deal in Dunkin’ history at the time, which included an exclusive opportunity to buy out the Pittsburgh region with approximately 100 stores. The area only had a handful of Dunkin’ locations, but the group has since opened five new stores per year.
HRG is privately owned by New Jersey-based real estate developer Ed Jaten and his college football teammate and roommate-turned-partner, Michael Orie.
From 1988 to 2008, Jaten spent his career buying, building, and developing high-quality real estate. “I felt that my background and my experience in real estate and construction and finance would make me a good super-franchisee if I could find the right brand and operator because at the time I knew nothing about restaurant operations,” Jaten says.
“I got involved with Dunkin’ mostly because I have a ton of kids and I was spending an awful lot of time at Dunkin’ Donuts on the weekends,” Jaten continues. “In [northern New Jersey], there’s a Dunkin’ on almost every corner, in every community.”
While getting treats with his children, Jaten also spent a lot of time observing the business model. Constantly crowded stores, everyday staples of coffee and doughnuts, and the recession-resistant aspect of an everyday drive-thru, Jaten knew instantly that Dunkin’ would be a great spot to franchise with, and assembled a group of restaurant operations experts.
Fueled by the magic of the New Jersey bacon, egg, and cheese (or Taylor ham), Jaten and his team set their sights on Pennsylvania.
Recently, HRG signed on to build 30 new stores within its territory, which Jaten estimates will take around seven years. “Ultimately, the goal is to top out at around 110 stores, plus or minus,” he says.
HRG is the top franchisee in terms of annual profitability and the number one franchisee in the Midwest region, which makes up about 2,000 Dunkin’ stores. The group owns and operates within a two-hour radius of Center City, Pittsburgh. Jaten notes that he’s considered franchising with other brands, but has yet to find an option that fits.
HRG is one of the largest employers in Western Pennsylvania, and VP of operations Scott Getty believes that the group’s “outside-of-the-box” culture has helped them achieve this status. One such offering is its car program, in which the brand pays for a new car when a general manager joins the team. Getty, who has worked for several other QSRs and fast-casual restaurants, says “nobody else is doing stuff like that.” Getty also hosts a “culture committee” comprising a quarterly rotating roster of general and district managers from across the company to gain insight and learn ideas from each other. Additionally, HRG hosts a monthly GM meeting, splitting the time between volunteering and team-building.
“We’ll go to a food bank, a school, a Salvation Army, a nature park, a foster home, we’ll bring a hundred people, and we’ll volunteer there,” Getty says. “After the volunteer event is completed, we’ll have an educational learning booth meeting. They’ll meet with [HR director] Laura [Parham] in one booth, and she’ll go over HR stuff with them, they’ll meet with my directors in another booth, and go over operations stuff with them. [The GMs] really love that, getting to see each other once a month.” A few times a year, Getty says the team will have a company barbecue, complete with volleyball and softball games.
Parham, who has been with the company for almost six months, has hit the ground running. One of the main initiatives she’s reinforcing is a people-first approach to improve employee retention.
March 7 was National Employee Appreciation Day, but, Parham says, “We decided one day wasn’t enough to show our employees how much we appreciate them, so we did a whole week filled with fun events and themes.”
Every HRG location dressed up to a different daily theme, such as Mardi Gras, Dr. Seuss characters, and band T-shirts to generate excitement and team collaboration, Parham says. “They shared all of their photos and some videos on social media and were able to connect with other stores and network and collaborate in a way that we really haven’t done before, so we’re continuing to approach unique opportunities like this in order to engage with our staff.” Even HRG’s doughnut-shaped mascot participated.
“Over the years, we’ve invested very heavily in recognition and reward programs because we understand the value and the correlation between recognition and reward and then retention,” Jaten says. “Even though we’re a big company, we’re small in the sense that we’re privately owned, and the owners are very accessible, empathic, and sensitive to each and every one of our employees.”
Another key aspect is hands-on assistance, and, as Getty notes, “We’re not coming in [to stores] and shaking hands or sitting in the dining room on our computer.”
Rather, Getty and fellow team members are in the stores seven days a week, “working side by side with the team, and that’s everybody—from my level as vice president to the directors below me to the [district managers] below them.”
HRG is also involved in nonprofit community organization efforts, including Best of the Batch Foundation, Penguins Foundation, Support Our Heroes Campaign, and the Dunkin’’ Joy in Childhood Foundation. Founded by former Pittsburgh Steelers quarterback Charlie Batch, Best of the Batch assists in improving the lives of local underprivileged youth across the region, with which HRG has helped raise money for the past 15 years, as well as assisting in the present-wrapping celebration in December. The brand helped to raise $100,000 for the Support Our Heroes Campaign and is a long-time donor to the Dunkin’ Joy Children’s Foundation as well.
