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1963 PRODUCTION
Hand production was a thing of
the past when automation
took over. The planning
and timing of production
became a vital task.
COMPANY PROFILE
Krispy Kreme is an international retailer of
premium-quality sweet treats, including its
signature hot Original Glazed doughnut.
Headquartered in Winston-Salem, NC.
Today, Krispy Kreme and its one-of-a-kind
Hot Light can be found in over 1000 shops
around the world.
Currently, Krispy Kreme can be found in 24
countries.
EXISTING MISSION
EXISTING VISION
VALUES
Consumers are our lifeblood, the center of
the doughnut.
There is no substitute for quality in our
service to consumers.
Impeccable presentation is critical wherever
Krispy Kreme is sold.
We must produce a collaborative team effort
that is unexcelled.
We must cast the best possible image in all
that
we do.
We must never settle for "second best;" we
deliver on our commitments.
PROPOSED MISSION
PROPOSED VISION
COMPETITORS
Dunkin' Donuts is an
American
global doughnut company
and coffeehouse chain.
Started in 1950
The chain's products
include doughnuts, bagels,
other baked goods, and a
wide variety of hot and iced
beverages.
Starbucks Coffee, is an
American coffee company
and coffeehouse chain.
Started in 1971
Serves hot and cold
beverages, whole-bean
coffee, microground instant
coffee, espresso, caffe
latte, full-leaf teas,pastries,
and snacks.
J.CO
DUNKIN
DONUTS
STARBUCKS
Weight
Rating
Score
Rating
Score
Rating
Score
Rating
Score
Advertising
.11
.22
.22
.44
.33
Product Quality
.15
.45
.60
.45
.45
Product Diversity
.08
.24
.24
.16
.08
Price
Competitiveness
.08
.24
.24
.24
.16
Management
.10
.30
.40
.30
.30
Financial Position
.10
.40
.40
.30
.20
Customer Loyalty
.10
.30
.40
.40
.30
Global Expansion
.13
.52
.52
.39
.52
Market Share
.10
.30
.30
.30
.30
Sales Distribution
.05
.20
.15
.10
.15
TOTAL
1.
2.
3.
1.00
3.17
J.CO 3.47
KRISPY KREME 3.17
DUNKIN DONUTS 3.08
3.47
3.08
2.79
SWOT MATRIX
STRENGTH
WEAKNESS
OPPORTUNITES
THREATS
1.
2.
3.
4.
5.
6.
7.
SWOT MATRIX
STRENGTH
1. Affordable high-quality doughnuts with strong visual
appeal and one-of-a-kind taste.
2. Many varieties of doughnuts and other menu items
including coffee.
3. Loyal customer base in the U.S. market.
4. Manufacturing uses accelerated approach that allows
a high volume of production.
5. The original glazed doughnut remains the top seller
amongst other pastries in its category.
6. Consistent expansion, now in 16 countries.
7. Product sold in thousands of supermarkets,
convenience stores, and retail outlets through U.S.
WEAKNESS
OPPORTUNITIES
1. Families crave convenience because of
busy lifestyle.
2. Asians love sweets and are open to
trying foreign foods.
3. Starbucks lacks a diversified and
distinctive pastry line.
4. Dunkin Donuts does not have hot
donuts to sell.
5. Many children love sweet treats.
6. Joint venture with other companies.
7. South America, Africa, and Southern
Asia are markets to conquer.
SO
1. More production of new doughnuts and other
menu items (S2, O2)
2. All store signs in supermarkets and
conveniences where product is sold have picture
of young child eating a Krispy Kreme doughnut
(S7, O5)
3. Continued grand openings of stores in highlypopulated cities (S6, O7)
WO
THREATS
ST
WT
SWOT MATRIX
STRENGTH
1. Affordable high-quality doughnuts with strong visual
appeal and one-of-a-kind taste.
2. Many varieties of doughnuts and other menu items
including coffee.
3. Loyal customer base in the U.S. market.
4. Manufacturing uses accelerated approach that allows
a high volume of production.
5. The original glazed doughnut remains the top seller
amongst other pastries in its category.
6. Consistent expansion, now in 16 countries.
7. Product sold in thousands of supermarkets,
convenience stores, and retail outlets through U.S.
WEAKNESS
OPPORTUNITIES
SO
WO
THREATS
1. Families crave convenience because of
busy lifestyle.
2. Asians love sweets and are open to
trying foreign foods.
3. Starbucks lacks a diversified and
distinctive pastry line.
4. Dunkin Donuts does not have hot
donuts to sell.
5. Many children love sweet treats.
6. Joint venture with other companies.
7. South America, Africa, and Southern
Asia are markets to conquer.
ST
1. Offering varieties of Donuts and filming their
reactions to make changes for such place; Do
"roadshow" across Europe as means of
advertising (S2, S5, T5, T6)
2. Compare "hot" doughnut appeal of Krispy
Kreme Donut to cold doughnuts of Dunkin'
Donuts in TV and Internet ads (S1,T1)
3. Express strengths and outline concrete
strategies in clear format within 10-K in order to
restore shareholder confidence in future of
Krispy Kreme Donut (S1-S7, T7)
WT
SWOT MATRIX
STRENGTH
WEAKNESS
1. Advertising not aggressive enough to appeal areas
outside of U.S.
2. Skill of management is questionable.
3. High employee turnover.
4. Slow to expand product line with nothing outside
sweet treats to draw in health-conscious
customers.
5. Revenue down, net losses in each of past three
years.
6. Limited amount of non-snack food items, because
of international differences/preferences, customers
tend to choose local stores.
7. Return on equity, assets, and investment are all
negative in the trailing twelve months.
OPPORTUNITIES
1. Families crave convenience because of
busy lifestyle.
2. Asians love sweets and are open to
trying foreign foods.
3. Starbucks lacks a diversified and
distinctive pastry line.
4. Dunkin Donuts does not have hot
donuts to sell.
5. Many children love sweet treats.
6. Joint venture with other companies.
7. South America, Africa, and Southern
Asia are markets to conquer.
SO
WO
1. Make strategy to increase profit such as
expansion through joint venture (W5, W7, O6)
2. Offer ways to incorporate nuts and protein into
foods; Make doughnuts filled with fruit, put
fruit cups on menu, and develop wide variety
of fresh fruit smoothies(W4, O3)
3. Demonstrate the appeal of Krispy Kreme
Donut, hot doughnuts, through aggressive
Internet ads (W1, O4)
THREATS
ST
WT
SWOT MATRIX
STRENGTH
WEAKNESS
1. Advertising not aggressive enough to appeal areas
outside of U.S.
2. Skill of management is questionable.
3. High employee turnover.
4. Slow to expand product line with nothing outside
sweet treats to draw in health-conscious
customers.
5. Revenue down, net losses in each of past three
years.
6. Limited amount of non-snack food items, because
of international differences/preferences, customers
tend to choose local stores.
7. Return on equity, assets, and investment are all
negative in the trailing twelve months.
OPPORTUNITIES
SO
WO
THREATS
1. Families crave convenience because of
busy lifestyle.
2. Asians love sweets and are open to
trying foreign foods.
3. Starbucks lacks a diversified and
distinctive pastry line.
4. Dunkin Donuts does not have hot
donuts to sell.
5. Many children love sweet treats.
6. Joint venture with other companies.
7. South America, Africa, and Southern
Asia are markets to conquer.
ST
WT
1. Open brand market to other countries
particularly in North-eastern U.S.; hire skilledemployee to manage such market (W2, T1)
2. Expand product line with low-calorie foods (W4,
T2, T7)
3. Recruit top executive talent from other fast-food
firms (W7, T7)
Weight
Rating
Weighted
Score
.08
.05
.10
.07
.03
.04
3
4
4
4
4
4
.24
.20
.40
.28
.12
.16
.09
.36
.12
.24
.08
.16
.08
.08
.06
.12
.05
.10
.06
.12
STRENGTHS
1. Affordable high-quality doughnuts with strong visual appeal
and
one-of-a-kind taste.
2. Many variety of doughnuts and other menu items including
coffee.
3. Loyal customer base in the U.S. market.
4. Manufacturing uses accelerated approach that allows a high
volume of production.
5. The original glazed doughnut remains the top seller amongst
other pastries in its category.
6. Consistent expansion, now in 16 countries.
7. Product sold in thousands of supermarkets, convenience
stores,
and retail outlets through U.S.
WEAKNESSES
1. Advertising not aggressive enough to appeal areas outside of
U.S.
2. Skill of management is questionable.
3. High employee turnover.
4. Slow to expand product line with nothing outside sweet
treats
to draw in health-conscious customers.
5. Revenue down, net losses in each of past three years.
6. Limited amount of non-snack food items, because of
Weight
Rating
Weighted
Score
.09
.36
.06
.24
.08
.24
.07
.21
.07
.28
.08
.32
.06
.18
.10
.10
.07
.06
2
2
.14
.12
.07
.07
.04
.08
Strong
3.0 to 4.0
I
IV
VII
II
V
VIII
III
VI
IX
The combined score of IFE and EFE puts it in cell V which indicates
hold and maintain.
This translates that the tactical strategies to be employed by KKD
should be market penetration and product development.
QSPM
In the QSPM two strategic alternatives were
compared:
KKD should discontinue its Company Store segment
and concentrate solely on building the Franchise
segment, or whether ;
It should continue the slow and steady growth of its
Company Stores and Franchise business segments
through its traditional business model.
QSPM
STRATEGIC ALTERNATIVES
1) Discontinue unprofitable stores and
2) Continue slowly and steady or
concentrate solely on building Franchise maintain growth of Company Store and
(local or international)
Franchise business segments through
traditional business model (local or
international)
Advantages
Disadvantages
Advantages
Disadvantages
Increase capital
Increase cost for
Attractive to
New development
from sold locations new franchise
international
and packaging
and properties
market
costs
Decrease loss
Risk for
More competitive
New ideas may
international
with markets
discomfort old
locations
customers
Develop new
May keep existing
market
customers
Opportunities for
More efficient
higher profit
More cost effective
in long run
2.93
1.36
RECOMMENDATION
The strategy that was decided for Krispy Kreme is to
discontinue unprofitable stores and concentrate solely on
building Franchise (local or international). This allows for
Krispy Kreme to get an increase in marketing and brand
awareness at a lower upfront cost. With the opening of
150 new stores in the next three years, costs will be
around $20, 000 TO $40,000 each store. The goal is by
the end of the three years to have a market share
increase and to also increase net income.
RECOMMENDATION
To support recommendation:
Adapt to consumers desires
Establish regular control of accounting
records and hire qualified personnel
Be more precise to mission and vision of
the company
RECOMMENDATION
Production
Understand and implement procedures to maximize efficiencies
and control variances in daily production of product and overall
commissary performance
Understand and implement commissary quality control
procedures, including standards
Coordinate production schedules to meet customer demands
and minimize labor hours
Inspect, troubleshoot, and assess any production or equipment
problems
Ensure all products meet Krispy Kreme quality standards
RECOMMENDATION
Sales
Work with the General Manager to achieve business plan objectives
and profitability as set forth in the commissary operating plan and in
the established financial goals
Thank
you!