Krispy Kreme case study Free Essay, Term Paper and Book Report
Krispy Kreme Doughnuts began in 1937 as a provider of a special recipe doughnut, obtained by Vernon Rudolph from a French chef, wholesale to supermarkets. As consumer interest in the product grew, Rudolph's concept of a factory store selling to retail customers began. Customers were enticed by watching the production of doughnuts while making their purchases. In the next 13 years, Krispy Kreme Doughnuts expanded to 29 shops in 12 states operating as franchisees.
Beatrice Foods purchased the company in 1973 and utilized a strategy of market saturation by quickly expanding from 29 to 100 locations. New products were introduced while changing the original doughnut recipe using less expensive ingredients and changing the storefront appearances. In less than 10 years the consumers lost interest and business suffered. Beatrice Foods then sold the company to the franchisees.
The CEO, Scott Livengood took the company public and raised $500 Million of market capitalization. As of 2004, new stores were growing at a rate of 42% for corporate owned, 22% franchised owned and 29% for factor......
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