PPT On Krispy Kreme
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Krispy Kreme Presentation Transcript:
1. Krispy Kreme ProfileFounded In 1937
Headquartered in Winston-Salem, North Carolina
Products – Doughnuts (30 kinds), soft drinks (espresso, chillers), hot drinks (coffee)
Revenue – 510.21 million USD (2006)
Net Income - 88.45 million USD (2006)
Employees – 4,250
2. Store Locations
Krispy Kreme have stores located all over the US
Stores have not been limited to only the US (Canada, United Kingdom, Mexico, and Australia)
Krispy Kreme can be found in grocery stores (Wal-Mart & Target), convenience stores, and gas stations
3. Two Locations in Oregon
Beaverton
16415 NW Cornell Road Beaverton, OR 97006 US
Clackamas
9950 S.E. 82nd Avenue Portland, OR 97266 US
4. Store Layout/Design
Freestanding: Most free-standing Krispy Kreme stores are constructed with a long window between the customer area and the kitchen, allowing customers to watch the operation of the doughnut-making machines. Smaller Stores: Most of the smaller stores get their donuts from other locations rather than producing them on-site.
Atmosphere: Very welcoming, with bright lighting. Seating is limited but available. Factory tends to pull curious customers inside.
5. Advertisement / Marketing
Free doughnut strategy – “Hot Now”; free doughnut while waiting in line.
TV ad campaign
Gifts/Accessories – shirts, sweatshirts, hats, boxers, coffee, mugs, toys.
Fundraising – helped schools raise over $30 million last year (selling doughnuts, coffee, certificates, and partnership cards).
6. Distinguishing Aspects
Store Layout: Factory inside the store where you can watch how the donuts are made.
Reputation: Krispy Kreme has always been known as and has had a reputation of being the best.
Hot Now: When the Hot Now sign outside the store is lit you can get hot and fresh original glazed donuts.
7. Recent Activity
KK went public in April 2000 at $21/share, and within a year that number doubled.
All seemed well for a couple of years, in spite of a few renegade analysts declaring KK stock “too high, given its modest quarterly net income.”
Merrill Lynch downgraded stock to “sell” in October 2002; J.P. Morgan cut the rating to “underperform” in August 2003.
8. Downward Spiral
Many credible Wall Street names held on ‘til May 2004, when KK stock fell 29% in one day after KK issued a profit warning (they blamed the low-carb craze seizing the nation). By Sept ’04, the stock had plummeted 77%.
Shares took another hit in late July ’04, when KK announced federal regulators were investigating the company.
KK failed to file its SEC reports for over a year (failure to meet accounting and financial reporting obligations).
9. . . . and it gets worse . . .
defaulted on loans
unable to borrow more money
two important franchises bankrupt (owed lots to KK)
class-action lawsuit by stockholders
CEO, COO & CFO unloaded shares at peak
caught boosting profits by extorting franchises
sold equipment and booked the revenue before payment was received – “cooking the books”
“sweetheart deals”
independent auditors refuse to sign off on KK’s financial statement
CEO and six key officers fired
rumors of de-listing on the NYSE
10. What next?
Krispy Kreme is struggling back into the market eye after a desperate tussle with near extinction.
January 29th, 2007: KK announced it has finally become current in its SEC filings, and has since maintained that status.
February 2007: introduction of a new whole-wheat doughnut: “made with 100% whole wheat . . . and, to make it even better, the doughnut is ONLY 180 calories!”
April 2007: announces change in its board of directors and names new corporate officers.
May 2007: Files its UFOC (Uniform Franchise Offering Circular), essentially declaring that it is once again, finally, licensing franchises.
11. Thank You.
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