Posted on 02/08/2005 2:50:16 PM PST by Willie Green
For education and discussion only. Not for commercial use.
Krispy Kreme Doughnuts Inc. is slashing its payroll by 25%. The number of jobs to be cut was not released by the company, but layoffs will affect employees in its corporate, mix plant, equipment manufacturing and distribution facilities.
The layoffs are the first significant move by Stephen Cooper, who was hired last month as chief executive. Cooper is chairman at turnaround specialist Kroll Zolfo Cooper.
The company (NYSE:KKD) says the cutbacks will result in annual pretax savings of $7.4 million and a cash restructuring charge of $600,000 in its first quarter.
The Winston-Salem-based doughnut manufacturer, whose shares have dropped from $40 in March to less than $8, has also divested a corporate airplane. Krispy Kreme says the move will result in annual pre-tax savings of $3 million and a cash charge of $300,000 in its first quarter.
Krispy Kreme has been investigated by the Securities and Exchange Commission regarding its accounting for franchise buybacks and its earnings outlooks. The company also faces shareholder lawsuits.
You know their donuts aren't exactly OUTTA this world for the price they ask for a doz. I think they are pretty expensive for 12 donuts. Besides, as much as I love sweets, that's one place I try to avoid...:(
My waist line will someday thank me!
The product is not that good and they not only over-saturated their franchises, but they also went into the grocery stores to provide a stale donuts there as well.
This story is no surprise to me at all.
Lent starts tomorrow. :-)
Once we lose these high paying jobs, we'll lose that frying technology.
We'll be wide open to attack by greasy Chinese teenagers asking if we want a sample.
Hmm, you'd think Micheal Moore would keep them in business...
never mind the lost technology (Just how DO they get the holes in the donuts..)
A friend in Seattle told me that when KK opened their first store in the city, there were lines of customers going out the door and around the block.
Today, nothing. The hype has evaporated.
I tried my first "classic" KK doughnut about 6 years ago during a trip to D.C. I thought it was pretty good then, but I must admit now that their products are kind of nasty and gross, as well as being riddled with fat grams.
The cost of the darned things also is high.
Take a flying leap at a rolling donut?
I beg to differ on the quality of there product, but on the hand they are over priced and you can tell the recession is over when donut businesses start losing money.
I don't get the rationale. All their profit margin is in providing yummy leftover donuts in the kitchen after corporate meetings.
Ancient Chinese secret!!
Just because I was available and near by, I went to California's first KK opening in La Habra a few years back.
Donuts were too sweet, so I haven't been back.
The first 18 months there were lines there, now nothing.
They also made a move to provide donuts to grocery stores so the grocery store did not have to maintain a bakery like before.
I see lots of donuts left behind there in the store as well.
They are failing...
They've been in groceries stores for over 15 years.
They just got greedy and expaned way too fast.
There donuts are tiny and glazed way to sweet.
The only draw regarding them are that they were warm when you got them and that was it.
Thats where I think Kripy Kreme is failing. You lesson the appeal of you product by letting them get stale all day in a glass case. I get a bad donut at a convenience store, sure wont make me go to the real place and get the fresh ones.
They haven't been in the grocery stores at all here in California until a couple of years ago.
About 4 years ago, the first state KK went up in La Habra, then other stores popped up.
Now they replaces the store donuts of Stater Bros. and others.
It is new to California.
15 years? Amazing, they are so bad.
Not here in NC, home of KK. :-)
They were losing their long lines after they opened more than a handful.
When they were available easier, most people realized they were NOT that special.
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