Does Your Company have a Competitive Advantage? Krispy Kreme Doughnuts, Inc. was created in 1937 by Vernon Rudolph. Nowadays Krispy Kreme Doughnuts, Inc. is a popular chain of doughnut stores that offers quality coffee roasting at significant discounts because of direct buying channels and unique know-how recipes, new improved coffee and new Hot Doughnut Machine technologies. According to MSN Website, as of January 29, 2006, there were 402 Krispy Kreme stores operated systemwide in 43 United States, Australia, Canada, Mexico, South Korea and the United Kingdom (MSN Website, http://moneycentral.msn.com/investor/research/prof ile.asp?Symbol=KKD).
According to Yahoo!Finance (Yahoo!Finance, http://finance.yahoo.com/q/co?s=KKD), direct Krispy Kremes competitors are Dunkin Brands, Inc., Starbucks Corp., Tim Nortons Inc, to mention a few. As far as all of them belong to fast food industry, the companies compete in several positions in order to get a competitive advantage. Krispy Kreme Doughnuts, Inc., Dunkin Brands, Inc., Starbucks Corp., and Tim Nortons Inc occupy an easibly accessible location for their customers and propose a high range of quality products at quite moderate prices.
Krispy Kreme Doughnuts, Inc. pursues short-term and long-term goals aimed to increase revenues from the new customers, to establish conditions sufficient to support planned growth of the stores through profitability, to maintain tight control of logistics, operations and quality, and to develop and market doughnut and coffee services. The company constantly improves its logistics and distribution process. According to information from Krispy Kremes website, every day Krispy Kreme makes approximately 7 million doughnuts. The components, store supplies and ambient temperature ingredients are shipped from Krispy Kremes distribution warehouses in NC, IL, and CA. According to information from Krispy Kreme Doughnut Case Study in October 2002, they shipped their first load of mix to Australia and have added locations in the UK, Korea and Mexico (p.1).
The Business plan on Krispy Kreme Doughnuts 5
... stores and the rest are satellites (MSN, 2009; Krispy Kreme Doughnuts, 2009a). KKD’s primary competitors include Starbucks Corporation, and Tim Hortons (Yahoo ... were recorded. The results appear surprising considering that the company has negative profitability. It could mean that the ... competitors and its industry Based on profitability ratios, the company is less profitable than two of its direct ...
The original project (March 1999) was the lone distribution warehouse in Winston-Salem, NC (p.1) with its goal to eliminate the manual/paper-based system and go to a real-time, RF-based pick and ship process. Recently the company started to use the Macola Progression Series ERP system that allows controlling distribution on a real-time basis for order status, and inventory and due to special interface module posts transactions to Macola as they occur in the warehouse (p.1).
Joe Pennel, Vice President (Distribution and Logistics, Krispy Kreme) underlines that due to this system, the company doesnt loose paperwork anymore as the Krispy Kreme distribution center supplies all of the products needed to operate a retail store (p.1) and carries approximately 10,000 SKUs which range from doughnut ingredients (mix, filling, glaze, sprinkles, etc) to cleaning supplies and uniforms (p.2).
The major part of the products and components are received into the system via purchase orders. The barcodes are generated automatically as a part of the working process. When the products are labeled, the operator utilizes the Directed Put-away function to determine the optimum stock location (p.2).
Such system uses different methods to consider any bin restrictions such as category or product, existing inventory of the same product, FIFO date requirements, proximity to the pick slot, etc. These details help to define recommended location. As the next step of the process, the orders packed in the bags are picked and loaded onto company trucks for delivery at the designated retail locations. The IVS system proposes the function of the Route Code Assignment: Warehousing, the individual store orders are assigned a route code and sequence that defines the stop order for the deliveries (p.2).
The Essay on Krispy Kreme 2 Industry Doughnut Stores
Krispy Kreme Doughnuts, Inc. is a branded specialty retailer of premium quality doughnuts. The doughnut retailer started its operation in 1937 when Vernon Rudolph, the company founder, realized the opportunities that existed in the thriving local economy of the developing southeastern city of Winston-Salem. Today, Krispy Kreme has its headquarters in Winston-Salem and sells approximately 3. 5 ...
The operators pick the products using both motorized floor jacks and forklift trucks (p.3).
Finally, the IVS system generates e-mail notification and sends it to the retail stores letting them know that their order has been shipped and a detail breakdown of the pallets and contents (p.3).
This new distribution solution increases the accuracy of order fulfillment and helps the company to operate more efficiently. Krispy Kreme Doughnuts, Inc. explores new distribution channels such as sporting events, schools, colleges and in-store bakeries at grocery stores. Although the company is constantly looking for new business solutions that improve their profitability, it seems Krispy Kreme hardly has the competitive advantage compared to its nearest competitors due to its assortment of goods. McDonalds, for example, has had its success with its fast food concept, Starbucks have had success increasing prices on soup and coffee over the years (Trigg n.p.), whereas Krispy Kreme has nothing addictive in its doughnuts. The company should undertake some effort in order to get the competitive advantage over its competitors. Bibliography Integrated Visual Systems. Krispy Kreme Doughnut Case Study.
Retrieved August 31, 2006. http://www.ivsi.com/pdffiles/KrispyKremeCaseRev1.p df MSN Website. Krispy Kreme Doughnut. Retrieved August 31, 2006. http://moneycentral.msn.com/investor/research/prof ile.asp?Symbol=KKD Trigg, Mike. (April 6, 2001).
Is Krispy Kreme the Next Starbucks? Retrieved August 31, 2006. http://www.fool.com/portfolios/rulebreaker/2001/ru lebreaker010406.htm Yahoo!Finance. Krispy Kreme Doughnut. Retrieved August 31, 2006. http://finance.yahoo.com/q/co?s=KKD.
