Krispy Kreme -- International Expansion discussion

Essay by schadenfreudeUniversity, Master'sA+, May 2008

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Rashers (bacon), fried eggs, toast, sliced tomatoes, fried mushrooms, black pudding (blood sausage), white pudding (pork and oatmeal sausage), baked beans, and tea or coffee comprise the cholesterol-laden traditional “full English” breakfast often offered to unsuspecting tourists. While the substantial meal is still served on the weekends in homes or at the local greasy spoon diner, the English prefer to eat cereal, toast, croissants, or muffins during the busy weekday mornings. The English are admittedly unconcerned with calorie content; instead, they gravitate towards convenient foods that can be consumed at one’s desk or on the way to work. Unlike the remainder of Europe, then, it is unsurprising that the British diet is largely composed of prepackaged, heavily processed “ready meals”(

Founded in 1937, Krispy Kreme Doughnuts has enjoyed wild popularity, currently selling over 7.5 million doughnuts a day ( Undoubtedly, the warm, fluffy, sugary treats would fare exceptionally well in the United Kingdom, particularly in light of the trends in breakfast habits.

Expanding internationally by opening Krispy Kreme franchises in the U.K. ideally will help increase long-term growth and profits, maximize revenue, enjoy the advantages of economies of scale, and improve the overall market position.

Expanding into developing countries, such as Ethiopia, would be a worthless venture for a company like Krispy Kreme. For one, the per capita income of Ethiopia is a scant $700, compared to the wealthy United Kingdom, whose per capita income is $27,700. Even though a Krispy Kreme donut costs a mere 85 cents, that sum is a fortune to an Ethiopian family, who survives on just $1.92 a day. The average family in the United Kingdom has funds to spare for convenience and snack foods, and thus would likely receive Krispy Kreme donuts well.

Along the same lines, the culture and political environment in the...