David Wheeler's fledgling franchise could take some of the guilt out of one of America's favorite deep-fried pleasures.
A 34-year-old Texan, Wheeler opened his Gonuts Gourmet Donut Bar in December 1998 at Collin Creek Mall in Plano, Texas. Rather than pitching the snacks to the granola crowd, Wheeler decided to target corporate customers and snack-hungry shoppers.
"When we did our test marketing, we found that when you say, 'Come try our low-fat or fat-free donut,' there's a perception that the product won't taste good," Wheeler says. "But this product is really flavorful."
Wheeler, who earned his law degree from the University of Tulsa, used to spend his days dissecting business plans, structuring investments, and thumbing through complex banking and real estate agreements. Growing dissatisfied with his life as an attorney and consultant, he longed for another line of work. The trouble was figuring out what to do.
The idea for Gonuts, including the name, logo and store, came to Wheeler in a recurring dream in 1997. "I can still visualize myself in the dream, leaning over the counter and handing donuts to children," he says.
Despite the confection-filled visions, Wheeler was wary of deep-fried foods. But one Saturday, while taking his children out for donuts, he thought: Why not exchange the deep-fryer for an oven? Would people go nuts over baked donuts?
Wheeler practiced law by day and studied the food industry at night. Finding no evidence that anyone else had tried baking donuts commercially, Wheeler quit his law practice and began meeting with chefs, pan manufacturers, architects and designers.
Research convinced him to move into a high-traffic regional mall rather than a freestanding store. "I found that most donuts are bought in the afternoon as a result of impulse buying in grocery and convenience stores," Wheeler explains. "I needed to be in a venue that was conducive to impulse purchases all day long."
Wheeler says business is bustling at the yellow-and-white debut location. Gonuts offers 30 different kinds of miniature donuts, many of which were suggested by customers. The menu includes traditional favorites such as sugar, glazed or chocolate, and more exotic flavors like strawberries and cream, Hawaiian delight or lemon poppyseed.
A single Gonuts serving of six donuts costs $2.29. A "Gonuts Dozen" of 14 donuts is $4.49, and a three-dozen party tray is $14.95. The donuts are each about 3 inches in diameter and contain roughly 17 calories and one gram of fat (before the topping).
Wheeler says Gonuts is ready to grow in 2000. "We're looking to expand in the-Fort Worth area immediately," he says. "After that, we'd like to move into Austin and Houston. I'd like to stay in Texas for the next couple of years because we're still perfecting the concept and refining our brand."
While Gonuts' Collin Creek location is 800 sq. ft., future sites would likely be between 500 and 600 sq. ft., Wheeler says. The existing store seats about 12 people, but seating is not a priority because to-go orders account for the majority of business. Gonuts adds variety to the food selections in a mall and faces little or no competition from other donut sellers, Wheeler notes.
"Taking my kids to shopping malls, I've found that we're really faced with two choices: Do we get one of those huge cookies or do we get a pretzel?" he says. "People get tired of the same old thing. This is just another option for consumers."
Contact: David Wheeler, Gonuts, 1139 Collin Creek Mall, 811 North Central Expressway, Plano, Texas 75075; (214) 999-5065; Fax (214) 999-5065.