Compensation Benefits of Starbucks vs. Dunkin Donuts


Description of thepaper

This essay provides a detailed analysis of the job description andthe remuneration as well as the benefits of a manager at Starbucks,as well as a store manager at Dunkin donuts. The paper will offer acomparison of the two managers’ benefits, as well as differences intheir job description, salaries and benefits if any. The paper alsoprovides a description of the theoretical foundation of the argumentspresented.

Abstract (executivesummary)

The salaries and benefits enjoyed by a store manager atStarbucks and the ones enjoyed by a store manager at Dunkin’ donutshave various similarities and differences. The job descriptions ofthese managers are also almost the same. One aspect that has beendemonstrated is that both managers are paid based on performance,experience and the period they have worked for the company (Alon,2010). The major differences that were identified are on the line ofthe benefits that the managers enjoy such as dental insurance, mentalhealth cover and occupational accidental cover.


The paper is based on the reinforcement theory of compensation whichasserts that a behavior that is rewarded is likely to be repeated. Onthe same note, the theory clearly states that a behavior that is notrewarded well will have a small likelihood of being repeated. Thestore managers at both Starbuck and Dunkin donuts are rewarded fortheir performance at the workplace. When the managers are rewardedwell for their performance, they are likely to perform better inorder to receive more rewards. This theory applies perfectly to thisscenario especially when considering the bonuses that the managers atboth the stores receive. The bonuses are based on the performance ofthe store manager. This implies that a good performance will attracta high bonus. This is a theory that calls upon the directors of acompany to compensate the employees for the work that they have done.When employees perform well, they are entitled to rewards or even anincrease in their pay.

Application of the theory

This theory can be applied in any situation where a certain behaviorneeds to be enhanced or suppressed. In this case, the compensationand the benefits of the store managers depend on their behavior interms of performance. Many companies across the world will have afixed salary or wage for an employee and a commission and or a bonuson top of the salary which is based on performance. The behavior thatis being reinforced is the good performance. Starbucks and Dunkin’donuts have commissions and bonuses for their employees which arebased on the manager’s performance at the relevant store. These areaimed at enhancing good performance through increasing sales by doingsuffient marketing and offering quality services to the clients.

This theory, however, has some advantages and disadvantages. Tostart with, the application of the reinforcement strategy encouragesproductive behavior, as well as motivates the store managers to beinnovative and hardworking in order to be rewarded. It is a theorythat has been proven to increase or enhance good behavior over theyears. The rewards in terms of bonuses and commissions encourage themanagers and the employees they work with to work even harder. On thecontrary, the application of rewards has been known for hindering newinnovations and behaviors since a manager may fear to lose the rewardwhen he fails in the new venture. Additionally, when a store managerfinds that the reward is not worth the effort he makes, he might notbe reinforced by the reward.

Job analysis, salaryand compensation benefit for a store manager at Dunkin donutsJob analysis

The job of a store manager at Dunkin donuts comprises of numerousduties and responsibilities that are associated with the job of amanager. A store manager at the enterprise of held responsible forthe performance of the employees that are under him or her in thestore. This implies that a store manager at Dunkin donuts mustsupervise the performance of the employees and also carry outperformance reviews with the employees periodically (Lamb et al.,2011). The store manager is held responsible for the operations ofthe store. The job of a store manager at Dunkin donuts is dividedinto three major categories which are customer care, labor managementand daily operations (Alon, 2010). Under labor management, the storemanager is expected to hire and facilitate the training of allassociates in the store, carry out the employees’ performancereviews and also create work schedules for the store. It is notablethat when the manager creates a work schedule, the responsibility ofdelegating duties and assigning work falls directly on him.

The daily operations in the store comprise a number of activitieswhich the manager at the store is expected to carry out. The openingand the closing of the store is one of the responsibilities of thestore manager under the daily operations. Secondly, the store managerat Dunkin donuts is expected to file all the paperwork in the storeand order any supplies for the store. Additionally, the manager atthe store is tasked with the responsibility of analyzing the weeklysales that the store has made (Dicarlo, 2004). Under the category ofcustomer care, the manager has the responsibility and the duty ofgreeting customers with respect and dignity. Additionally, themanager is expected to handle the complaints that customers mighthave in a professional manner. It is also the duty of the manager tomake sure that the employees handle the customers respectfully andaddress their concerns speedily and correctly.

A store manager’s job at Dunkin’ donuts comprises the role ofensuring that the standards of the Dunkin’ are maintained throughthe services offered to the clients. The manager must ensure that theemployees are trained on the standards expected in their servicedelivery and critically observe to ensure that the standards arebeing kept. The standards relate customer service, food quality,sanitation and safety. The manager is also responsible for themaintenance of the controllable costs in the store such as payrolls,cost of papers and food. The job requires an honest andstraightforward person as the manager at any Dunkin’ Donuts storeis expected to handle cash on a daily basis. It is also worth notingthat the store manager is responsible for the observation of all thelaws from state and the federal government. When necessary, the storemanager is held responsible for the discipline of employees. Everystore manager at Dunkin’ Donuts is expected to attend all themanagement meetings and also chair meetings in his or her department.

Salary and bonuses

A store manager at Dunkin’ donuts is entitled to a salary everymonth and additional benefits. It worth noting that the salary forstore managers varies depending on experience, period a manager hasbeen with the company and the location. It is evident that there aresome stores that are in extremely busy regions and the job analysisof managers in such regions indicates that they have more duties tohandle than managers in areas where there is a small flow ofcustomers (Dicarlo, 2004). The longer a store manager stays with thecompany, the higher the pay. This is tied to the aspect of experiencewhere an employee is said to gain experience on the job. Performanceof a manager at a Dunkin’ store increases with experience hence theadditional pay.

As a starting store manager at Dunkin’ donuts, one is entitled topay of between $ 20,000 and $ 30,000 per year. However, research hasindicated that the average pay for the store managers at the companyranges between $ 25,000 and $ 40,000 per year. Critics have arguedthat the salary offered for a store manager at Dunkin’ donuts is20% less than the national average salary for store managers. Thereare some store managers at Dunkin’ Donuts who earn as much as $60,000 per year. These are managers who have worked for the companyfor a long time and who have immense experience on their jobs.Additionally, such managers might be working in some extremely busylocations (Alon, 2010). It is essential to note that the payment ofthe manager or the salary is calculated on hourly basis. On top ofthe salary, the manager is entitled to commissions. There are alsobonuses which are based on performance and which might go as high as15% of the basic salary.

Other benefits

There are other benefits that the store manager enjoys while workingat the store. The store manager is entitled to health insurance ormedical cover where the company pays up to 75% of the medical cost.Managers are also offered the 401k benefits by the employer. Inaddition to these benefits, the store manager also enjoys dentalinsurance and vision insurance. It is also worth noting that themanager enjoys a life insurance cover while working at the company.Vacations for the managers are paid. The company offers storemanagers vacations every year and also the managers are entitled tothe normal pay during the vacation. The same case applies to sickvacation where store managers are entitled to their salaries andother benefits while at a sick vacation. Store managers at Dunkin’donuts are also offered free training on the job once they join thecompany. However, there have been complaints regarding the quality ofthe training. The store manager is entitled to either a maternity orpaternity leave. Additionally, the store manager is also entitled toa family medical leave and also entitled to tuition assistance. Whena store manager wants to extend his paid leave, the company offers apackage for unpaid extended leave to the store manager.

While at the store, the company offers free lunch and snacks for thestore manager. Additionally, the store manager is entitled to a 10%discount on all the items he or she purchases from the store. A worthpoint to note here is that the store manager is not allowed to carrysnacks or lunch away from the store without paying a discountedprice. Other benefits include sponsorship of company social events,volunteer time off and reduced and or flexible working hours (Alon,2010). It is abundantly clear that the store manager at Dunkin’donuts has numerous benefits and the salary is attractive. There isopportunity for growth at the store and the managers are givenautonomy to run the store independently.

Job analysis, salaryand compensation benefit for a store manager at StarbucksJob analysis

Starbucks is one of the largest coffee shops across the worldand this means that job analysis of a store manager will indicatethat the manager has numerous duties and responsibilities. A storemanager at Starbucks has the responsibility of running the dailyoperations of the store (Quelch, 2006). The manager is expected tocontrol the supply of materials in the store and ensure that there issufficient stock for running the store efficiently. Every storemanager at Starbucks is also expected to conduct training for theemployees who are also known as partners at Starbucks (Bussing-Burks,2009). The store manager conducts the hiring process as well as thefiring process of any partner. Additionally, the store manager isexpected to carry out performance reviews for all the partners andalso for a review of their wages.

The profitability of the store is in the hands of the store managerand he or she is expected to look for opportunities for sales(Reavis, 2014). The manager at every Starbucks store must keepaccurate weekly inventories of labor costs, as well as cost of goods.In case of any product, the store manager should inform all thepartners and provide them with all the details. The store manager hasthe responsibility of preparing work schedules for the partners,assigning work and also preparing time off for the partners(Bussing-Burks, 2009). It is evident that in every workplace thereare employee conflicts and concerns. A store manager at Starbucks isexpected to address every partner concern and also resolve anyconflicts in the workplace. It is also the role of the manager toguide the partners towards achieving the goals of the Starbuckscoffee company (Schultz &amp Gordon, 2011).

The handling of the cash at the store is left in the hands of thestore manager. This is one of the daily operations at the store thatthe manager is held accountable for. The manager is also expected tocarry out assessments to determine the requirements of partners, aswell as the requirements for new partners at the workplace. The“service experience” phrase is extremely common at Starbucks andit is used as a marketing tool (Isidro, 2004). The directors of thecoffee company expect every store manager to offer every customer aservice experience at their stores (Gulati &amp Neilson, 2008).Store managers are expected to handle every customer complainprofessionally and to ensure that every customer looks forward toreturning to the store. The manager must also guide the partners inhandling the customers professionally and maintaining the serviceexperience for all the customers.

Salary, bonuses and commissions

A store manager at Starbucks is entitled to salary, commission,bonuses and other benefits which will be discussed below. The averagesalary for a store manager at Starbucks is $ 48, 355 per year. Thesalary may start as low as $ 35,000 per years and rise over time toas high as $ 71, 000 per year. Research has indicated that this isthe average national salary for a store manager across the UnitedStates. A store manager is also entitled to cash bonuses which aretied to performance. Stock bonuses are also part of the package thata store manager at Starbucks gets (Reavis, 2014). This is calculatedon the basis of the stock that a store manager has managed to sellover a certain period.


There are other numerous benefits that a store manager at the coffeecompany enjoys. A store manager is entitled to health insurance, lifeinsurance, dental insurance, disability insurance, mental healthcare, occupational accidental cover and supplemental life insurance.This is a clear indication of the benefits that relate health andlife that a store manager enjoys at Starbucks (Bussing-Burks, 2009).The manager is also entitled to the 401k plan, pension plan andretirement plan. This comes along with the employee stock purchaseplan and the performance bonus. The store manager is also entitled to92 sick days paid leave, as well as vacation and paid time off. Thecompany offers managers and other partners military leave, maternityand paternity leave, as well as adoption assistance.

Lastly, the store managers are offered free lunch and snacks at thestore, as well as employee discount on products bought from thestore. The company has a program for tuition assistance and alsooffers intensive job training. It is clear that Starbucks is indeedone of the best companies to work for as a store manager (Isidro,2004). The benefits are immense and they resonate with the needs of amodern employee.

Comparison of thesalaries and benefits between store managers at Starbucks and Dunkin’donutsComparisons

There are a number of similarities in terms of jobdescription and benefits that a store manager at Starbucks enjoys, aswell as those enjoyed by store managers at Dunkin’ donuts. Bothmanagers at both stores are paid hourly and this is basis that isused for calculating the annual pay. It is also clear from thediscussion above that the store managers from both coffee companieshave overlapping duties. To start with, the managers are responsiblefor customer service and to ensure that the customer’s complaintsare addressed effectively. The managers at both stores are alsoresponsible for the process of hiring, carrying out performancereviews for employees and firing when necessary.

The store managers are rewarded with various benefits which aresimilar at both coffee companies. The managers are offered lifeinsurance by their respective companies. Additionally, the managersare offered dental cover, vision cover and health insurance. The twomanagers are also offered paid vacation and paid leave for certainperiods. The managers are also entitled to maternity and paternityleaves which are paid (Alon, 2010). Research has indicated the twocompanies offer extended leave days which are unpaid. The two storemanagers are entitled to free lunch and snacks at the companypremises. However, they have to pay when buying products from thecompany for use outside the company. It is worth noting that themanagers buy the products from the company at discounted prices.Managers at both coffee shops are offered free training about theirjobs and are entitled to tuition support. Additionally, managers atboth stores are offered bonuses which are based on their performance.The higher the performance by a manager: the higher the bonus.

Differences of salaries, benefitsand job analysis between store managers at Starbucks and Dunkin’donuts

Since the two businesses are rivals in the industry, there arevarious differences in terms of the way employees are compensated andtreated. As it has been found in the above discussion, store managersat Starbucks are paid a higher salary than the ones at Dunkin’donuts (Shultz, 2008). A store manager at Starbucks earns $ 48,335per year which is equivalent to the average national salary for astore manager. On the other hand, a store manager at Dunkin’ donutsearns $ 25,000 to $ 40,000 which is 20% less than the nationalaverage store manager salary. This is an indication that Starbucks isdetermined to attract the best employees and to abide by the setstandards by the state and federal laws regarding compensation.

There are also various differences in terms of the benefits that theemployees enjoy in both companies. At Starbucks, a store manager isentitled to military leave while at Dunkin’ Donuts there is no suchleave. It is also evident from research that at Starbucks, a storemanager is entitled to mental illness cover which is absent for astore manager at Dunkin’ donuts (Notte, 2009). Another benefit thatthe Starbucks leadership offers the store managers is the adoptionassistance benefit which is not available to store managers atDunkin’ donuts. It is clear that Starbucks is coming out as thebetter employer. Another key difference in the benefits that areoffered by Starbucks and not offered by Dunkin’s donuts is thedisability insurance. This is benefit that managers at Starbucksenjoy while those at Dunkin’ donuts do not enjoy (Bussing-Burks,2009). There is also the contrast in terms of the benefits related tooccupational accidental cover and supplemental life insurance. Thesecovers are available to store managers at Starbucks but are notavailable to store managers at Dunkin’ donuts.


The research conducted and documented above has clearly indicatedthe differences in terms of salaries, job analysis and benefits thata manager at Starbucks coffee company and a store manager at Dunkin’donuts enjoy. It can be conclusively be said that the store managerat Starbuck is well remunerated and has numerous benefits than themanager at Dunkin’ donuts (Porter, 2010). This is from the annualsalary to benefits such as mental health cover and occupationalaccident cover. Starbucks has come out as the company that abides tothe law in terms of remuneration of employees (Alon, 2010). It is,however, worth noting that the two store managers have almost similarduties and responsibilities. As it has been found out above, bothmanagers have the responsibility of ensuring that there are smoothoperations in the store every day. The managers handle the cash andhave duty of reviewing the employees’ performance and assigningthem work. The store managers have also been given the mandate tohire, train and fire the non-performing employees.


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