Krispy Kreme, Inc. (previously Krispy Kreme Doughnuts, Inc.) is an American multinational doughnut company and coffeehouse chain. Krispy Kreme was founded by Vernon Rudolph (1915–1973), who bought a yeast-raised recipe from a New Orleans chef, rented a building in 1937 in what is now historic Old Salem in Winston-Salem, North Carolina, and began selling to local grocery stores.[2][3] Steady growth preceded an ambitious expansion as a public company in the period 2000 to 2016, which ultimately proved unprofitable. In 2016, the company returned to private ownership under JAB Holding Company, a private Luxembourg-based firm. In July 2021, Krispy Kreme became publicly traded again on the Nasdaq. The brand name is a deliberate non-standard spelling of "crispy cream", for marketing effect.
History
Early years
In 1933, eighteen-year-old Vernon Rudolph, along with his brother Lewis Rudolph, began working for his uncle, Ishmael Armstrong, who owned a small general store in Paducah, Kentucky, that sold a wide variety of goods, including its very popular doughnuts.[4] While the exact origin of the doughnut recipe remains partially a mystery, it is believed that Ishmael Armstrong was inspired by an Ohio River barge cook named Joseph LeBeouf who was famous for his light and fluffy doughnuts, which contained potatoes.[3][4]
The store struggled during the Great Depression. In 1934, Vernon and Ishmael decided to move to the larger city of Nashville, Tennessee, where they hoped business would be better. The uncle and nephew focused solely on selling their doughnuts and opened "The Krispy Kreme Doughnut Company" in a rented store on Gallatin Road.[4] The shop did so well that Vernon's father, Plumie, also left Kentucky and moved to Nashville to help sell doughnuts. In 1937, Rudolph opened his own store, deciding on Winston-Salem, North Carolina, for the location when he learned that his favorite cigarette company, Camel Cigarettes, was headquartered in the small North Carolina city.[4] Rudolph primarily sold to convenience stores; however, he also sold hot doughnuts to individual customers who came during production time between midnight and 4 a.m.[4] The first store in North Carolina was located in a rented building at 534 South Main Street in Winston-Salem in what is now called historic Old Salem. The Krispy Kreme logo was designed by Benny Dinkins, a local architect. The first Krispy Kreme bakery outside the South opened in Akron, Ohio, in 1939.
Growth
Expansion occurred in the 1950s, including an early store in Savannah, Georgia. By the 1960s, Krispy Kreme was known throughout the Southeast, and it began to expand into other areas. In 1976, Krispy Kreme Doughnut Corporation became a wholly owned subsidiary of Beatrice Foods of Chicago, Illinois. The headquarters for Krispy Kreme remained in Winston-Salem. A group of franchisees purchased the corporation back from Beatrice Foods in 1982. Krispy Kreme began another phase of rapid expansion in the 1990s, opening stores outside the southeastern United States where most of their stores were located. In December 2001, Krispy Kreme opened its first store outside the US in Mississauga, Ontario, Canada.[5] The minimum investment amount to open a Krispy Kreme franchise ranges from approximately $450,000 to above $4M.[6]
IPO and accounting scandals
On April 5, 2000, the corporation went public on the NASDAQ at $21 using the ticker symbol KREM.[7] On May 17, 2001, Krispy Kreme switched to the New York Stock Exchange, with the ticker symbol KKD, which it carried until its private acquisition. The stock reached what would be its all-time high of $50 on the New York Stock Exchange in August 2003, a gain of 135% from its IPO price. For the fiscal year ending in February 2004, the company reported sales of $665.6 million and operating profits of $94.7 million from almost 400 stores (including international locations). The market initially considered the company as having "solid fundamentals, adding stores at a rapid clip and showing steadily increasing sales and earnings."
In May 2004, the company missed quarterly estimates for the first time and suffered its first loss as a public company. Chairman and CEO Scott Livengood attributed the poor results to the low-carbohydrate diet craze. This explanation was viewed with skepticism by analysts, as "blaming the Atkins diet for disappointing earnings carried a whiff of desperation",[8] and as rival doughnut chain, Dunkin' Donuts, has not suffered from the low-carb trend over the same compared period.[9]
Return to private ownership
In May 2016, JAB Holding Company, a German investment firm, announced that it made an offer to purchase the company for $1.35 billion over the following two months that would make the company privately owned.[14] The transaction closed on July 27, 2016. In December 2017, Krispy Kreme moved its corporate headquarters to Charlotte, North Carolina; while Winston-Salem retained the majority of operational departments and the Krispy Kreme Support Center.[15]
Also in 2010, Krispy Kreme Express, a delivery service for businesses, began testing at the Battleground Avenue location in Greensboro, North Carolina.[16] In the early 2010s, the company began developing shops with tunnel ovens, which allow for an all-day "Hot Now" hot doughnut experience.
On February 24, 2015, Krispy Kreme opened its 1,000th shop, in Kansas City, Kansas.[17]
Going public again
In May 2021, Krispy Kreme confidentially filed for an initial public offering to once again go public.[23] The company went public again on the Nasdaq on July 1, 2021, under the name Krispy Kreme Inc.[24][25]
On March 26, 2024, Krispy Kreme and McDonald's announced a partnership where Krispy Kreme doughnuts would be gradually rolled out to all McDonald's locations nationwide by the end of 2026. This followed a successful test market experiment in Kentucky. Markets such as Pittsburgh and Columbus, Ohio, were selling Krispy Kreme products at McDonald's by the end of 2024.[26][27][28]
International operations
The first Krispy Kreme store to open outside North America was in Penrith, part of metropolitan Sydney in Australia.[30] The second Krispy Kreme store that was opened internationally was in the United Kingdom and was in Harrods department store London. It closed in June 2011. As of 2018, there are over 100 stand alone Krispy Kreme stores in the UK, and a presence in 500 Tesco stores.[31] Besides the stores that Krispy Kreme operate in the United States and Canada, there are also locations in Egypt, France, the United Kingdom, Australia, New Zealand, South Africa, Spain, Lebanon, Turkey, India, the Dominican Republic, Iceland, Ireland, Kuwait, Guatemala, Mexico, Costa Rica, Panama, Russia, Taiwan, South Korea, Malaysia, Thailand, Brazil, Indonesia, the Philippines, Japan, Singapore, Cambodia, Jordan, the United Arab Emirates, Qatar, Saudi Arabia, Bahrain,[32] Hong Kong, Nigeria, Ethiopia, Jamaica and Chile.[33]
In August 2011, Krispy Kreme's Japanese operation planned to increase the number of stores from 21 to 94, and its Mexican operation announced the number of stores would increase from 58 to 128 in five years.
Products
On February 19, 2007, Krispy Kreme began selling the Whole Wheat Glazed doughnut in an attempt to appeal to the health conscious. The doughnut has nearly the same number of calories as the original glazed doughnut (180 calories vs. 190 calories) but contains more fiber (2 grams vs. 0.5 grams). As of January 2008, the trans fat content of all Krispy Kreme doughnuts was reduced to 0.5 of a gram or less. The U.S. Food and Drug Administration, in its guidelines, allows companies to round up to 1 g in its nutrition facts label when the food contains as much as 0.5 of a gram per serving. Krispy Kreme benefited from this regulatory rule in its subsequent advertising campaign, touting its doughnuts as "trans fat-free" and having "0 grams trans fat!".[46]
On July 1, 2010, Krispy Kreme introduced a doughnut that included the soft drink Cheerwine, which was to be sold in grocery stores in North and South Carolina during July.[47] The doughnuts proved so popular that the Salisbury, North Carolina, Krispy Kreme location (the town where Cheerwine is made) sold them as well.[48] After July 31, this was the only place to get them.[49]
Promotions
Although based on informal advertising such as word-of-mouth, in 2006, Krispy Kreme moved into television and radio advertisements, beginning with its "Share the Love" campaign with heart-shaped doughnuts.[58] Since 1955, the company has offered fundraising kits for organizations to sell boxes of doughnuts; Krispy Kreme would then split the proceeds with the organizations to raise funds for various causes.[59]
In 2014, Krispy Kreme released a $1,685 doughnut as part of fundraising efforts for The Children's Trust. It was covered with 24-karat gold and was decorated with edible diamonds. The inside was made from Dom Pérignon champagne jelly.[60]
In March 2021, Krispy Kreme announced that they were providing a free Original Glazed doughnut every day (except Thanksgiving Day and Christmas Day) for the rest of that year to customers in the US who could prove they have received a COVID-19 vaccine.[61]
Controversies
Krispy Kreme Klub Wednesday
In February 2015, a Krispy Kreme branch in Kingston upon Hull, England, announced during the half-term break of schools that it was launching, among other events that week, "Krispy Kreme Klub Wednesday", during which children could decorate doughnuts. However, it attracted controversy after it was promoted as "KKK Wednesday" on Facebook, due to it sharing an abbreviation with the Ku Klux Klan, an American white supremacist terrorist group. Krispy Kreme promptly apologized, canceled the event, pulled all marketing relating to it, and launched an internal investigation.[64][65][66]
Cage-free eggs
In 2016, Krispy Kreme committed to sourcing 100% cage-free eggs in the US by 2021, and globally by 2026.
See also
- List of doughnut shops
- List of coffeehouse chains
- List of companies involved in the Holocaust
External links
References
- Krispy Kreme Donuts Inc. 2024 Annual Report United States Securities and Exchange Commission, January 31, 2025, retrieved March 24, 2025^
- Krispy Kreme – About Us retrieved December 24, 2012^
- David A. Taylor. The History of the Doughnut