Krispy Kreme wants to fill Spain with Donuts: it lands in Madrid with its first store

Krispy Kreme prepares his landing in Spain. The small dónuts factory founded by Vernon Rudolph in Winston-Salem, a town in North Carolina, in full depression, is today an empire extended by the world whose donuts are found not only in the establishments of its chain, but also in supermarkets and hamburgers of McDonald's. The company has chosen the Westfield Parquesur Shopping Center (in Leganés) for its landing in Spain, where it arrives with great ambitions, but at a time when the company is accumulated problems, including a recent computer attack. The shares are quoted since the company, with an agitated corporate history, came out with the second time. Ozempic and diets are its enemies; The gluttony and the delicious taste of its products, its allies. Will the American brand triumph in Spain? The Parquesur premises will not be just a store. In the company's DNA is to manufacture donuts to distribute in stores and supermarkets. That was the original business of the first Winston-Salem store. However, Vernon Rudolph began selling donuts recently made directly to customers who passed through the workshop at the production schedule, between midnight and four in the morning. That success encouraged the entrepreneur to open their own premises. In the 1950s, the company introduced its Krispy Kreme theater concept, a simple, but effective idea. He separated the workshop from the sale and consumption zone with simple glass moons, so that customers could directly witness the hypnotic production process. Although of a smaller size than Dunkin (founded as Dunkin Dónuts in 1950), Krispy Kreme has become an iconic brand with a faithful audience that still uses its original logo. With its lights and its shadows, the case of the company has been studied again and again in business schools. The expansion of the company occurred in stages. In the 1950s, in the southeast of the country, its region of origin. In the next one, he began to get out of his natural market, both with his own stores and with franchises. In parallel to their growth, property changes began. Beatrice Foods bought it in 1976, but a franchisee group acquired it again six years later. After another period of strong expansion in the 1990s with a model of regional master franchises or developers, Krispy Kreme opened its first store outside the United States in Mississauga, on the outskirts of Toronto (Canada), in 2001. It sold to investors a growth story, a strong brand recognition, a multichannel distribution, a profitable business model and sannelled finances. Its sources of income were their own stores, the sale to shops, the rights paid by the franchises and the sale of equipment and ingredients to the franchisees. He succeeded. In its premiere in the stock market the shares rose 76% and in just two years they had multiplied their value at a time when investors were scalded by the outbreak of the technological bubble and appreciated traditional businesses and in which Krispy Kreme accelerated their growth. This growth was choked. He saturated the market with openings that cannibalized the sales of the old stores and with the increase in distribution in supermarkets. In addition, the smallest premises did not have their own production, to disgust from the brand lovers, who valued that they were freshly made. First, the franchisees began to go wrong; Then, to the matrix. The company breached its forecasts, suffered its first losses and the actions collapsed almost as fast as they had risen. The company undertook a flight forward in which the SEC accused her of inflating her income, growing artificially with the fraudulent sale of franchises and other irregularities in order to meet objectives and that the managers receive their incentives. The company ended up reformulating its accounts and dismissing those responsible for the deception. Jab Holding Company, investment group of the German family Reinmann, owners of Pret to Manger and Peet's, launched an OPA for 1,350 million dollars and excluded it from the stock market in 2016 and took it out to the market in 2021, in the prostrimers of the pandemic. This second time, the placement was not so successful. The sellers had to lower the price from the initial range of $ 21-24 and place the titles to $ 17. Even so, they captured 500 million dollars, with an assessment of the company of about 2.8 billion. This week the shares have quoted to less than four dollars and the valuation has fallen below 700 million. A computer attack altered the company's operations in the fourth quarter. The results disappointed and analysts have cut their forecasts. With an economy that cools and threatening inflation, donuts appear as a dispensable whim. The company has undertaken a strong expansion plan, but neither sales nor profitability have accompanied. That includes 394 stores with its own work and 1,684 smaller stores, but also 1,900 McDonald's restaurants, with whom it has signed an alliance, and thousands of supermarkets and hypermarkets of large chains such as Walmart, Target and Safeway where the product serves daily. Krispy Kreme has an international division with its own premises and distribution in the United Kingdom, Mexico, Canada, Australia, New Zealand, Ireland and Japan and another of franchise development, so that it is present in more than 40 countries, despite its greatest implementation, sales fell 1.2% in 2024, up to 1,665 million dollars and the result of exploitation (EBIT) It excludes the impact of cyber attack, decreased by 21.6%, up to 90.2 million. The net profit was three million, in the face of losses the previous year. With everything, the company continues to bet on its international expansion, with Spain, Brazil and Germany as immediate bets. In Spain, the Parquesur premises will have the concept of Krispy Kreme theater, which will allow to see the elaboration of the glazed donuts, its original recipe. The establishment will work not only as a store but also as a main production center for Madrid and its area. The expansion plan foresees new openings of “Krispy Kreme” theaters in cities such as Barcelona and Valencia, as well as premises around that they will receive recent products made every day. Currently, the director of the Company for Spain, Manuel Zamudio, has as one of the priorities the location of the locations for the Spanish adventure of the donuts born 88 years ago in North Carolina.