Krispy Kreme Banking On International Market
When Krispy Kreme Doughnuts Inc. began thinking about selling its glazed doughnuts internationally in 2001, analysts questioned how well the delicacy would go over with foreign consumers.
Eight years later, the company’s slowly blossoming global sales could be the key factor keeping the it independent and out of bankruptcy — a fate some analysts have predicted for this year.
All of which means the jobs of 490 Triad employees, including 414 in Winston-Salem, are riding on Krispy Kreme’s ability to make its doughnuts a lifestyle choice rather than an occasional treat in markets as diverse as China, England, Kuwait and Japan.
More than 80 percent of Krispy Kreme’s stores are operated by franchisees, and 57 percent of its 526 stores are outside the United States as of Jan. 31.
Kristin Graham, a senior analyst for The Motley Fool, said she questions whether Krispy Kreme will survive intact this year because of the heavy load of corporate debt it took on during its ill-fated domestic expansion strategy under previous top executive Scott Livengood.
“But if there is a life preserver for Krispy Kreme, it would be its international sales,” Graham said.
“If they can expand correctly and establish the brand correctly, particularly in new markets in China, Malaysia and Turkey, it could be enough to carry them through 2009.” The company plans to open at least 75 stores in those markets by 2013.
“If international sales fail to grow, the company probably will fail overall,” Graham said.
None of the speculation is news to Moto Shimizu, a Krispy Kreme franchisee operator in Japan.
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