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Krispy Kreme Doughnuts Essay Sample

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Krispy Kreme Doughnuts Essay Sample

Krispy Kreme Dougnuts was founded on July 13, 1937 in Winston-Salem, North Carolina, United States by Vemon Rudolph. The company became a publicly-traded company in April 2000. Krispy Kreme Doughnuts produces approximately 5.5 million doughnuts a day consisting of 20 varieties. Krispy Kreme Doughnuts serves customers in 395 stores where 40 stores are in the United States and the rest are in 10 foreign countries namely Australia, Canada, Hong Kong, Indonesia, Japan, Kuwait, Mexico, the Philippines, South Korea and the United Kingdom. 282 stores are owned by franchisees while 113 stores owned by the corporation.

THE VISION OF KRISPY KREME DOUGHNUTS

Our vision guides every aspect of our business by describing what we need to accomplish in order to continue achieving sustainable growth. 1) People: Being a great place to work where people are inspired to be the best they can be. 2) Portfolio: Bringing to the world a portfolio of quality doughnuts brand that anticipate and satisfy people’s desires and needs. 3) Partners: Nurturing a winning network of customers and suppliers, together we create mutual, enduring value. 4) Planet: Being a responsible citizen that makes a difference by helping build and support sustainable communities. 5) Profit: Maximizing long-term return to shareowners while being mindful of our overall responsibilities.

THE MISSION OF KRISPY KREME DOUGHNUTS
Our mission declares our purpose as a company. It serves as the standard against which we weigh our actions and decisions. It is the foundation of our Manifesto.

1) To make people happy while enjoying our products.
2) To inspire moments of optimism through our brand and our actions. 3) To create value and make a difference everywhere we engage.

LONG-TERM OBJECTIVES

Positioning itself as the leading high-quality donut maker and retailer in its established market, and to expand its market around the world, with emphasis on domestic expansion. And to set themselves apart from other donut makers in the industry through its many distinguishing attributes.

STRATEGY

On-premise KKD sales include direct in-store sales to customer visiting inside or coming through the drive through window. Discounted sales for community organization fundraising purposes are also included in on-premises sales. Off-premises sales include fresh doughnuts distribution of branded, unbranded, and/or private-label doughnuts to grocery and convenience stores.

DEVELOPMENT OF VISION AND MISSION STATEMENT FOR THE ORGANIZATION

Vision: To be the customer’s doughnut of choice by offering an affordable product with universal appeal.

Mission statement. Based on the mission statement provided by KKD, it has not fulfilled the overall criteria of an effective mission statement. It has not explained about the products and services, markets, technology, concern for survival, growth and profitability, concern for public image and concern for employees.

Suggestions:

i) Products and services. Our doughnuts, which are made from a secret recipe that has been in our company since 1937, have a one-of-a kind taste that generations of loyal customers have grown to love.

ii) Markets. Currently, Krispy Kreme can be found in 17 countries, including the United States, Australia, Bahrain, Canada, Indonesia, Japan, Kuwait, Lebanon, Malaysia, Mexico, the Philippines, Puerto Rico, the Republic of Korea, Qatar, the Kingdom of Saudi Arabia, the United Arab Emirates, and the United Kingdom.

iii) Technology. Our vertically integrated, automated system is designed to create high quality, consistent doughnuts in an efficient manner. Quality control starts with our manufacturing plant, which produces proprietary Krispy Kreme mixes our state-of-the-art laboratory runs quality tests on all key ingredients and each batch of mix.

iv) Concern for survival, growth and profitability. The company will conduct its operations prudently and will provide accurate profits and growth which will assure shareholders satisfaction and the success of KKD.

v) Concern for public image. Krispy Kreme is also committed to strong local community relationships. Our store operators support their local communities through our popular fundraising programs and the sponsorship of local events.

vi) Concern for employees. To recruit, develop friendly personnel of exceptional caliber by providing good working conditions and benefits on the basis of performance and opportunity of growth.

EXTERNAL OPPORTUNITIES AND THREATS

OPPORTUNITIES

1. It is anticipated that the remaining stores will receive the new beverage program, primarily expresso and frozen beverage in the next 12 to 18 months. 2. Krispy Kreme plans to continue to open stores internationally in Japan and Spain and increase their presence in countries where they currently operate. 3. Krispy Kreme will develop a new “low calorie” doughnut selection. 4. Krispy Kreme will offer the tea drinking British with its own custom brews of coffee. 5. Krispy Kreme Doughnut is planning to concentrate on development efforts primarily in Asia and Middle-East.

THREATS

1. Dunkin Donuts has over seven thousands stores in 2007 up from 5438 stores two years earlier. 2. Starbucks approximately have 12 thousands retail stores worldwide. 3. Tom Horton’s is the largest restaurant chain in Canada.

EFE Matrix

Key Internal Weight Rating Weighted
Factors Score

Opportunities

6. It is anticipated that the remaining stores will receive the new
Beverage program, primarily expresso and frozen beverage in The next 12 to 18 months. 0.05 4 0.2 7. Krispy Kreme plans to continue to open stores internationally

In Japan and Spain and increase their presence in countries where
They currently operate. 0.15 2 0.3 8. Krispy Kreme will develop a new “low calorie” doughnut

selection. 0.20 3 0.6 9. Krispy Kreme will offer the tea drinking British with its own

custom brews of coffee. 0.10 1 0.10 10. Krispy Kreme Doughnut is planning to concentrate on

development efforts primarily in Asia and Middle-East. 0.15 2 0.3

Threats

4. Dunkin Donuts has over seven thousands stores in 2007 up from
5438 stores two years earlier. 0.25 4 1.00 5. Starbucks approximately have 12 thousands retail stores

worldwide. 0.05 1 0.05 6. Tom Horton’s is the largest restaurant chain in Canada. 0.05 2 0.10

Total 2.65

IFE Matrix

Key Internal Weight Rating Weighted
Factors Score

Strengths

1. Company stores average weekly sales per store increased 1.6% 0.08 3 0.24
to approximately $51,000

2. Krispy Kreme’s total revenues from franchise fees rose $2.3 0.09 4 0.36
Million in fiscal 2007.

3. Sales of mixes and other supplies were partly offset by a 26% 0.08 4 0.32
increase in epuipment, furniture, fixtures and similar items.

4. In fiscal 2007, 60 new international stores were opened. 0.18 3 0.54

5. Franchise revenues consisting mostly of franchise fees and 0.10 3 0.30
Royalties increased over 14% to $21 million in fiscal 2007 from
$18 million one year earlier.

Weaknesses

1. Sales to franchise stores decreased 10% to $114 million in fiscal 0.08 1 0.08
2007.

2. Company stores revenues decreased 18% to $326 million in
0.11 1 0.11
fiscal 2007 from $398 million in fiscal 2006.

3. KKD’s net loss for the second quarter of fiscal 2008 was $27 0.09 2 0.18 million compared to a net loss of 4.6 million in the comparable period of fiscal 2007.

1. KKD supply chain revenues decreased 16.8% to $23.7 million. 0.09 1 0.09

2. KKD total average weekly sales per store decreased 2.8% to
Approximately $37500. 0.1 1 0.1

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