Krispy Kreme For New Stores

The company has been sold several times. First, in 1935 Ishmael Armstrong sold Krispy Kreme to Vernon Rudolph’s father Plumie Rudolph. Second, in 1976 due to Vernon Rudolph’s death, the company was then sold to Beatrice Foods of Chicago. Third, in 1982 Joseph A McAleer Sr. who led a group of Krispy Kreme franchisee bought back Krispy Kreme from Beatrice Foods. Finally, Krispy Kreme Inc. became a publicly traded company in 2000 by joining the NASDAQ as well as joining NYSE in 2001.

Their strategy was about customer service rather than profit or revenue. The growth was built on creating new products for the existing target market.

Krispy Kreme is a branded specialty retailer and manufacturer of premium quality doughnuts. Its principal business is to own and franchise Krispy Kreme doughnut stores in the U.S. and internationally. The main product is the Hot Original Glazed, a one-of-a-kind doughnut with an established brand. Each outlet also sells over 20 other varieties of doughnuts and coffee products. Product quality and consistency has provided the Company with a very loyal customer base.3

Each of the individual components have been previously discussed, but it is interesting to compare them together to see how three of the most important aspects of the business have changed over time. Specifically it is worth noting that Profit Margin has increased significantly every year since 2000. What this means is that Krispy Kreme has gotten better every year at turning each sale dollar into net income.

Dunkin’ Donuts is an American global doughnut company and coffeehouse chain based in Canton, Massachusetts that was founded in 1950. At start, it was famous for its quick service food doughnut but now it has already been well known for its high quality coffee and quick customer service. It is one of the subsidiary companies with sister brand Baskin-Robbins under the franchiser Dunkin' Brands.

Krispy Kreme has experienced dramatic growth over the past 5 years based on their income statement. Every line on the income statement has grown rather impressively. Revenues have grown from $220M to $666M and net income has grown from $6M to $57M. Based on the income statement, Krispy Kreme is doing very well.

As Wall Street Journal stated, Krispy Kreme grew too quickly and diluted its cult status by selling its doughnut in too many outlets. They could not anticipate when the demand decreased due to low-carbohydrate diet trend issues. It can be seen clearly that interest expenses also increased for the year ended Feb 2, 2003 to the year ended Feb 1, 2004 as the debt increased.

Dunkin’ Donuts was established by Bill Rosenberg in 1950 in Quincy, MA. Dunkin’ Donuts started license franchises in 1955. It is the world’s leading baked goods and coffee chains serving more than 3 million customers per day. Dunkin’ Donut sells 52 varieties of donuts and more than a dozen coffee beverages as well as an array of bagels, breakfast sandwiches, and baked goods. At the end of 2010, there were 9,760 franchises all over the

Dunkin also has salads and soups for its clients unlike Starbucks. The baked goods of Starbucks are cooked somewhere else and not in the shop whereas the entire bakery operations of Dunkin Donuts are handled in house only. Apparently, Starbucks products have a regional flavor to them whilst the same does not hold true with Dunkin Donuts. You would find Starbucks offering you entertainment accessories like CDs and books

Socio-Cultural- Due to the numerous cultures present in Dunkin' Donuts' target market, the company as a whole must be in continuous change in order to keep up with its consumers. Dunkin Donuts must keep in mind the age, income, occupation, and most importantly the lifestyles of their customers if they wish to succeed in such a competitive market. As an answer to this problem, the company has implemented several changes aimed at keeping and attracting a new customer base. Many restaurants are looking towards centralized kitchens to maximize space and reduce costs, consequently cutting product costs, thus saving the customer money. The

Strengths: Dunkin’ Donuts is very popular in its industry and has established a powerful brand and image through its efficient operations, low prices and the wide range of high quality products it offers. Moreover, the company experiences economies of scale as it has many operations worldwide. In addition they have significant bargaining power against their suppliers due to the experience they obtained and the support they acquire from Allied Domecq, one of the strongest companies in the market.

The company under analysis in this report is Dunkin Donuts. The brand of Dunkin Donuts originated in 1950 when Bill Rosenberg opened the very first outlet in Massachusetts, USA. Today Dunkin' Donuts is the world's leading baked goods and coffee chain, serving more than 3 million customers per day worldwide. It sells about 52 varieties of donuts and more than a dozen coffee beverages as well as an array of bagels, breakfast, sandwiches, subs and other baked goods. Dunkin Donuts is a subsidiary company of Dunkin Brands Inc that owns companies like Dunkin Donuts, Baskin Robins etc. Dunkin Donuts is a multinational company with its presence in more than 32 nations. By the end of 2011, there were 10,083 Dunkin' Donuts stores worldwide that included 7,015 franchised restaurants in the United States of America and 3,068 international outlets in more than 32 countries across the globe employing more than 9000 people. According to the financial report published by Dunkin Brands Inc, the parent company of Dunkin Donuts the net sales worldwide totaled up to $8.77 billion, up 5.2 percent from the previous year and the Net income for the year was $108.3 million, up 214.5 percent as reported by the company.

Problem is Thai people interest with Krispy Kreme lower than the beginning period, so male Krispy Kreme no more long queues although Krispy Kreme launch more favors, but not attraction customer like beginning period. Now Krispy Kreme has not yet opens a new branch although I think Krispy Kreme must to open new branch.

A shift in consumer demand to want healthier fast-food options has hit the industry hard. Dunkin’ Donuts and Starbucks have combated this shift by offering healthier menu items, something Krispy Kreme has failed to do. Dunkin’ Donuts offers healthy breakfast sandwiches and

KKD's business model provides the company three sources of revenue: (1) Sales at company-owned stores; (2) Royalties from franchised stores and franchise fees from new stores; and (3) Sales of doughnut mixes, customized doughnut-making equipment, and coffees to franchised stores.