Krispy Kreme … More Troubles.
A few months ago I mentioned that Krispy Kreme had a new strategy to move into selling ice cream, which seemed like a pretty lame idea to me. According to the Wall Street Journal today, “Great Circle Family Foods, LLC, once Krispy Kreme Doughnuts Inc’s largest franchisee, filed for Chapter 11 [bankruptcy]” last Wednesday. If you remember in my previous posting on this topic, I described Krispy’s goal to expand from 300 stores to 500 stores. Gonna be hard to do if their larges franchisee’s can’t make it! According to the WSJ, the reasons for the bankruptcy filing were given as “an unmanageable amount” of debt, overexpansion, lack of marketing, increases in costs of goods purchased from Krispy Kreme, consumer dietary changes, and the absence of a “credible” coffee program!
– Chris