Duck Donuts adds flavor to competitive regional market

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We eat more than 10 billion of them each year, and CNBC reports that Americans spend more than a half billion dollars a year just on convenience-store doughnuts. National chains blanket the country — Massachusetts-based juggernaut Dunkin’ Donuts has more than 8,000 U.S. locations, while North Carolina-based Krispy Kreme has more than 1,000 — and local and regional chains add another layer of flavor to a competitive industry.

Enter Duck Donuts.

Founded in Duck, N.C., in 2006, the up-and-coming chain opened its first Pennsylvania location last week in Lancaster County.

Is Manheim Township franchisee Todd Bidelman concerned about the competition? Don’t bet on it. He believes that fresh, hot, custom-topped vanilla-cake doughnuts, created in front of customers’ eyes behind glass viewing panels, will give the shop an edge over the mass-produced style.  

“This is the most superior doughnut I’ve ever had,” said Bidelman, who left a career in manufacturing and pharmaceuticals to open the made-to-order doughnut shop in the Overlook Town Center.

Duck Donuts CEO Russ DiGilio agrees, and momentum seems to be on his side.

The company has grown from a family project into an up-and-coming chain with 23 franchise locations. By the end of this year, the company expects to have up to 35 stores in operation, with dozens more under contract, stretching from New Jersey to Florida.

Closer to home, the Mechanicsburg resident plans to open in June a flagship store and 600-square-foot training center on the Carlisle Pike in Hampden Township, in a former Verizon outlet.

“This is happening organically,” DiGilio said.

And it all started with a summertime hankering.

A Cumberland County resident, DiGilio spent three decades working in health care, most recently overseeing the management and development of nursing and assisted-living facilities.

He and his family spent their vacations in North Carolina, but something was missing.

As a teen growing up in New Jersey, DiGilio had savored the pleasures of freshly made doughnuts along the boardwalk in Ocean City. The Outer Banks might be beautiful, but DiGilio and his family saw an opportunity to bring a taste of his youth to the North Carolina coast.

What started as “a whim, a far-fetched idea,” became a bricks-and-mortar reality 10 years ago.

Within five years of opening the original Duck store, the chain had four Outer Banks locations, and DiGilio said he was frequently approached about franchise opportunities.

The first franchise opened in Williamsburg, Va., in 2013. More followed.

“We didn’t know how this would do in non-vacation spots,” he said.

The answer, it turns out, is rather well.

Neither of the midstate locations looks anything like a coastal resort town, but there are other elements that DiGilio and Bidelman calculate as appealing to customers: 36,000 vehicles pass through the Carlisle Pike corridor each day past the Cumberland County store, and in Lancaster County, 18,000 along Fruitville Pike and 30,000 more nearby on Route 30.

DiGilio said Pittsburgh-area stores are expected to open later this year, while he hopes to gain a foothold in the Philadelphia market down the road — the opening of a store in Avalon, N.J., a resort popular with Philadelphia-area tourists, may help, he suggested.

Positioning itself as a tourist draw enabled Duck to grow, both by attracting customers, and by inadvertently convincing some of those customers — like Bidelman and his wife, Mimi — to become franchisees so they could bring the taste home to their own communities.

The Lancaster County couple was inspired to invest in a franchise after falling in love with the baked treats during a vacation to Kill Devil Hills, N.C., a few years ago.

Todd Bidelman said his brother-in-law told them about the shop.

“When we first pulled in, there was a line of about 50 people waiting out on the sidewalk,” Bidelman recalled.

He was skeptical. Until he finally tried one of the doughnuts.

“I was captured,” he said.

What’s so special? The doughnuts are the draw, but DiGilio says creating an atmosphere of family fun is what gets people in the door.

The baked goods are made fresh in front of customers for those who can visit the stores, with glass windows for families — especially children — to watch as doughnuts are dipped and topped with various confections before being served warm in the box.

Daughter Marissa DiGilio, who handles training for the chain, said training on making the vanilla cake doughnuts is important, but training franchisees on good customers service is essential. To satisfy anticipated crowds and keep the lines moving, a store can need as many as 10 employees, plus a manager, on busy Saturday mornings, she said.

Bidelman’s 1,300-square-foot Manheim Township store will create 25 new jobs, and uses PA Preferred milk products. In addition to doughnuts, the stores offer coffee and breakfast sandwiches.

For Mimi Bidelman, who is continuing her career in the pharmaceutical industry while helping with the franchise, it offered something else: a path toward entrepreneurship.

“Everyone wants to be their own boss, right?”