Strategic Management of Krispy Kreme Doughnuts

STRATEGIC MANAGEMENT OF KRISPY KREME DOUGHNUTS
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(26, November 2010)
Strategic Management of Krispy Kreme Doughnuts
Having analyzed the organization`s situation, this essay considers Krispy Kreme Doughnuts` current strategy and makes justified recommendations or development of that strategy. Some possible strategies that have matched external factors with internal factors at Krispy Kreme Doughnuts include marketing, vital business model, attention to quality, a balanced financial model, and aggressive expansion.
Krispy Kreme Doughnuts in the recent years has used marketing strategy to capitalize on strong market existing for doughnuts by establishing itself as a director by using the power of its recognized brand name, entering target market through many sales channels, and turning out a high volume product. (Novelguide, 2002).
The company has employed unique and successful business model. Krispy Kreme Doughnuts is divided into two business units and that one is the compliment of the other. It has the store operations that encompass the company store segment and the franchise segment of store. The other division is the manufacturing and development or KKM&D unit, its main source of income is the sale of doughnuts produced and distributed by the store operations, having its strong operating competencies and abilities to support the store.
On quality side, Krispy Kreme Doughnuts has set itself apart from competitors by the use of the best ingredients and vertically integrated process of production designed to create consistent quality in a manner that is efficient. The efforts of quality control include state-of-the-art labs in its manufacturing plants. These laboratories undertake quality control tests on all main ingredients and on each batch of mix (Novelguide, 2002).
With its efficient financial model, the company creates sales and income from its store, franchise fees and royalties, and a supply chain that is vertically integrated, that supports its operation.
The company has also employed an aggressive expansion campaign. In 2002, sixteen new stores, while 25 more stores were opened 2001. By the year 2000, area franchisees were contractually mandated to open 250 new stores in the period of January 2000 and 2006 Januar, (Bilal, 2010).
The company strategies that appeared included; branding strategies, pricing strategies, and distribution strategies. The company over years has created a huge reputation, and a significant amount of its brand awareness and loyalty- on its signature warm glazed doughnuts, forms a huge branding assets branding asset for them. The Krispy Kreme marketers know the value of brand equity. The customers are given chances to purchase buy hot doughnuts, hence became l...