US Markets
Thursday, November 9th, 2023 6:52 pm EDT
Key Points
- Krispy Kreme is in discussions to expand its partnership with McDonald’s, which began testing doughnut offerings at select McDonald’s locations in Kentucky more than a year ago. The partnership is being explored as part of a strategy to enhance customer visits to McDonald’s, where Krispy Kreme’s doughnuts would complement the coffee offerings.
- Krispy Kreme’s discussions with McDonald’s have focused on aspects such as ensuring the delivery of fresh and timely doughnuts, determining the necessary scale for expansion beyond Kentucky, and evaluating the commercial viability of the partnership. The pilot program aimed to gauge customer demand and assess operational considerations.
- Krispy Kreme, known for its fresh doughnuts, has been able to increase its prices without negatively impacting sales. The company’s “hub and spoke” model efficiently produces and distributes its doughnuts to retail locations, supporting both loose and pre-packaged doughnut sales. While the company’s third-quarter earnings and revenue fell short of expectations, Krispy Kreme’s stock has risen more than 20% this year, with a market capitalization of $2.10 billion.
Krispy Kreme is in discussions to expand its partnership with McDonald’s. The collaboration began more than a year ago, testing the appetite for doughnuts among Big Mac eaters in a few McDonald’s locations in Kentucky. By March, the pilot program had expanded to around 160 restaurants in Kentucky, serving as a test to gauge customer demand and operational viability. These discussions have touched on Krispy Kreme’s ability to deliver fresh and timely doughnuts, scalability for a wider rollout, and the commercial potential of the partnership. Krispy Kreme employs a “hub and spoke” model for efficient doughnut production and distribution. While the company’s third-quarter earnings and revenue fell short of expectations, shares of Krispy Kreme have risen more than 20% this year, currently holding a market cap of $2.10 billion.
For the full original article on CNBC, please click here: https://www.cnbc.com/2023/11/09/mcdonalds-and-krispy-kreme-are-in-talks-to-expand-partnership.html
