Krispy Kreme Case Study :: Business Analysis Strategy

Krispy Kreme Case StudyQuestion 1. The chief element of Krispy Kremes scheme is to throw in the towel a better doughnut and to appeal to customers in new ways. They gull taken great steps to insure customer satisfaction from the subprogram of their proprietary flour recipe to their automated doughnut making machines. They set about chosen to target mainly markets with 100,000 households. They also were exploring smaller-sized stores for secondary markets. Krispy Kremess strong injury conjure, highly differentiated products, high-volume production capability and multi-channel market penetration strategy has worked well. With each new store opening there be lines wait at the door all night to experience the Krispy Kreme quality. In Denver, more(prenominal) than 3000 people stood in a line extending for more than three urban center blocks on opening day. They have production areas in full ensure and a neon light that lights up when Hot Donuts are actually co ming off the line. Krispy Kreme makes customers feel good about indulging. Even Krispy Kremes name brings a smile to peoples faces.Question 2. I think Krispy Kremes financial carrying into action has been good. Since its initial public offering in April 2000 it has grown from 140 stores to one(a) with 218 locations in 33 states and Canada. Preliminary results for fiscal year 2002 showed sales exceed $621 million, up 39% from the previous year. Revenues climbed 30% to $392 million. Krispy Kreme is a product come with and the most profitable part of the business is doughnut sales due(p) to the high volume of loyal customers. Many Wall Street analysts considered Krispy Kreme to be overvalued. Analysts said in April 2000 the stock was destined for the $15 to $20 contend range at best, which is where most known food related stocks are located. Instead it had been hovering at a value of $40 a get by for most of the year. The stock rose to a high of $54 and so me(prenominal) analysts doubted Krispy Kremes strategy and potential growth merited a stock price nearly 70 times projected 2002 earnings per share. I go for with the statement the numbers just dont work.Question 3. SWOT ANALYSIS