Duck Donuts CEO Betsy Hamm on Balancing Growth and Franchisee Success

Duck Donuts CEO Betsy Hamm had a successful career at Hershey Entertainment Resorts before joining Duck Donuts, where she has played a key role in the brand’s growth from a beloved local favorite to an emerging national franchise. In a recent episode the “Meet the Zor” podcast hosted by 1851 Franchise Founder and Publisher Nick Powills, Hamm discusses her entrepreneurial journey and her strategies for providing franchisees with the support they need to succeed.

Hamm’s background in marketing and operations helped her navigate the transition to franchising, where she quickly realized the unique challenges of supporting franchisees in a rapidly growing system.

“It was very quick to realize that there’s a lot to it, and these franchisees are investing their life savings — a ton of money — and it’s our job to make sure we’re giving them the tools and resources to be successful,” Hamm said. 

As Duck Donuts continues to expand, Hamm emphasizes the importance of selecting franchisees who are not only passionate about the brand but also capable of managing the operational demands. The brand’s rapid growth has created both opportunities and challenges, particularly in ensuring that franchisees are well-supported and can thrive in their local markets. Hamm is focused on refining the brand’s operational processes and increasing franchisee profitability while maintaining the brand’s core values.

“We talk about the ‘circle of success’ at Duck Donuts, where everyone supports each other — from the franchisor to the franchisee, to the managers, to the team, to the customers,” said Hamm. “If everyone is happy and doing their part, the customers keep coming back, the franchisees make more money and the whole system is successful. It’s all about interdependency and making sure everyone in the circle is doing their part.”

With nearly 200 locations in the pipeline, Duck Donuts is poised for significant growth, but Hamm remains committed to supporting franchisees and maintaining the brand’s integrity. Her journey from corporate America to franchising underscores the importance of experience, adaptability, and a clear vision in leading a successful franchise.

The full transcript of Hamm’s interview with Powills is provided below. It has been lightly edited for clarity and brevity.

Nick Powills: How did you accidentally fall into franchising? What’s your franchise backstory?

Betsy Hamm: It really was by accident. I spent the first 15 years of my career at Hershey Entertainment Resorts. My job was getting people to the sweetest place on Earth — Hershey Park, the chocolate spa, and all that good stuff. It was a cool job, but I always kept an ear out for any opportunities. A friend mentioned that Duck Donuts was opening their corporate headquarters in the Harrisburg area, and they were looking for someone to build a marketing team. Honestly, I had never heard of Duck Donuts at the time and had never been to the Outer Banks. I texted a few of my friends who were big Outer Banks fans and asked if they had heard of Duck Donuts. They were so excited about the donuts, so I thought, “I really need to take this interview.” I ended up meeting with the founder, who was the CEO at the time, and he shared his vision of making Duck Donuts a national household name. That’s a marketing person’s dream, so I jumped in, and here we are.

Powills: You fell into this. Did you feel like you had a grip on what franchising is from day one, or was it a crazy rollercoaster?

Hamm: I had food and restaurant experience from Hershey, but not franchising experience. It was a quick realization that there’s a lot to it, and these franchisees are investing their life savings — a ton of money — and it’s our job to make sure we’re giving them the tools and resources to be successful. Coming into an emerging brand where everything wasn’t fully developed, we needed to figure out the strategy, structure, people and processes so that we could not just grow the brand but also support these franchisees and small business owners to be successful. It was definitely eye-opening.

Powills: I’m going to put myself in your shoes in that moment. When you go into a brand that has size, there’s a need to sell franchises versus cultivating operators. When you heard about Duck Donuts, people probably raved about it, similar to Hershey chocolate. That’s a rarity, but it almost puts pressure on the brand. How do you say no to the wrong people when they’re knocking down your door to franchise?

Hamm: The founder, Russ, will be the first to admit that when they started selling franchises, it was his brand — it was his baby. He was excited when people loved the brand, and he would say, “Great, let’s do this.” But mistakes were made along the way with people who weren’t the right fit or didn’t have the capital. Franchising — especially running a franchise — is a lot of work. We give you the tools, the brand, the recipes, but you have to run it. In the beginning, when everything wasn’t figured out, there was so much interest that it became a challenge to step back and really assess who the right partners were and which markets made sense. That was one of the biggest challenges, especially when you’re so excited that people are excited about you.

Powills: How do you navigate the challenge of opening in a new market where initial enthusiasm is strong, but maintaining momentum relies heavily on the local operator’s ongoing marketing efforts?

Hamm: Yeah, because you can have that big honeymoon phase, right? You get that initial push with all the excitement, and that might carry you through six to nine months. But eventually, the hype wears off and you have to focus on maintaining frequency. When you’re just one donut location with a small marketing budget — both national and local — it’s really tough. That requires a lot of boots on the ground, building relationships. It’s much easier when you have multiple locations in a market. And from a supply chain perspective, being a single shop pulling from distribution presents its own set of challenges.

Powills: Is navigating the shift from corporate infrastructure with extensive resources and red tape to a franchise system with less support, more urgency, and still significant red tape a challenging storm for you as a leader?

Hamm: The storm has definitely changed a few times. When I started at Duck Donuts, I was the first hire from outside the friends-and-family circle — I think I was employee number 12. I came in with a strong corporate background, accustomed to structure, process, and a lot of red tape and endless meetings. I remember thinking, “Where is everybody?” I conducted a SWOT [strengths, weaknesses, opportunities and threats] analysis on the brand and marketing, identified priorities, and then realized, “Oh, it’s just me and one other person, so I have to do all of this myself.” Coming from a large marketing team at Hershey, it was a huge culture shock, especially since we were such a small, mom-and-pop operation. That was the first major adjustment. Then, three years ago, I stepped into the CEO role, and that’s also when private equity came in, which changed the structure and approach significantly. You see the same thing with franchisees — they come from all sorts of backgrounds: corporate, military, medical and more. We’ve evolved from a small operation with 12 employees to a much more sophisticated organization, and as we approach 200 locations, that evolution continues, impacting not just us but our franchisees as well.

Powills: Does navigating both the structured environment at Hershey and the hands-on experience at Duck Donuts give you a unique perspective that has changed or evolved how you approach your career day-to-day?

Hamm: Absolutely. Over the past eight years at Duck Donuts, I’ve realized that emerging brands could be my niche. If we can continue to grow Duck Donuts successfully, maybe down the line I’ll have the opportunity to do the same elsewhere. It would likely be easier the second time around with all the lessons learned — mistakes and successes alike. Getting the strategy, structure, people and processes in place is the recipe for success, and helping other brands do that in the future would be incredibly rewarding.

Powills: How are you closing gaps in franchising, especially when it comes to the time it takes from impression to inquiry on franchise websites?

Hamm: Absolutely. I think nearly all of our franchisees — probably 95% — didn’t have franchising experience when they joined us, so it’s about setting the right expectations. My sales team might say, “Well, we talk about this on the brand overview calls, and we explain what we do and what the franchisees need to do.” But the reality is, people often come in thinking we’ll do everything for them, or they don’t realize the importance of consistency and being part of a larger brand. I try to put them in the shoes of the customer: Would you expect a Chipotle or McDonald’s to be different each time you visit? No, there’s an expectation of consistency. So, with an emerging brand like ours, where most franchisees have no prior experience, it’s crucial to help them understand their responsibilities versus ours. Sometimes we might disagree, but the key is to find the best path forward together.

Powills: Do you think educating franchisees about what’s behind the fees they pay — like showing them how much infrastructure and support is provided — could help create a smoother path for them?

Betsy Hamm: Absolutely. As we simplify operations, it becomes easier for franchisees to be more profitable, which is ultimately why they’re here. They’re not necessarily in love with the brand; they know there’s potential to make good money. So, the challenge is improving profitability, increasing average unit volumes and reducing the need for extensive infrastructure within the shops. We’re at a point where addressing these areas is crucial to taking the next step with larger, more sophisticated franchisees.

Powills: Have you found that your ability to remove the emotional side of running a business, while still loving the product, has helped you set up a good business infrastructure?

Hamm: Right. I think what I’m really a fan of is the experience and the joy our brand brings to people. At Hershey, people had a nostalgic connection, and I’ve seen the same with Duck Donuts. It’s amazing to see how something as simple as a donut can bring such happiness. I couldn’t see myself working for a brand where I didn’t believe in the product’s ability to make people’s lives better, even if just for a moment. That’s what makes it fun for me — knowing that we’re sprinkling happiness in people’s lives.

Powills: Do you think happiness, starting from the franchisee and flowing down through the entire operation, is key to the success of a brand like Duck Donuts?

Hamm: Right, exactly. We talk about the “circle of success” at Duck Donuts, where everyone supports each other — from the franchisor to the franchisee, to the managers, to the team, to the customers. If everyone is happy and doing their part, the customers keep coming back, the franchisees make more money and the whole system is successful. It’s all about interdependency and making sure everyone in the circle is doing their part.

Powills: What’s your vision for Duck Donuts over the next year or two?

Hamm: We’re in growth mode right now. We’ll open about 45 shops this year and hit 200 locations in the first quarter. Beyond just increasing our number of locations, we’re focused on making our franchisees more successful and profitable. The challenge is driving frequency — getting people to come back more often. We’ve added other product lines like beverages and ice cream, and we recently launched a donut ice cream sandwich that’s doing really well. Our goal is to stay relevant and keep the traffic coming into the shops regularly, all while continuing to grow and improve profitability for our franchisees.

Watch the full interview above or on YouTube.