Quick Summary

Krispy Kreme, founded by Vernon Rudolph in 1937 in Winston-Salem, North Carolina, is a global leader in the doughnut industry. Famous for its Original Glazed® doughnuts, Krispy Kreme also offers coffee, beverages, and a variety of specialty treats.

Initially focused on selling doughnuts through grocery stores, Krispy Kreme later transitioned to retail locations, emphasizing fresh production through its signature tunnel oven shops. This innovative approach has made Krispy Kreme a standout in the dessert franchise market.

Key Takeaways

• Krispy Kreme operates over 1,600 locations globally, including 373 in the U.S., across 35 countries.

• Franchisees can choose from four models: Factory Store, Tunnel Oven Shop, Fresh Shop, and Box Shop.

• Initial investments range from $440,000 to $2,750,000, depending on the store model, with a required net worth of $2 million.

• Training includes 65 days of on-the-job learning and 15 days of classroom instruction.

• Franchise owners earn approximately $275,000 annually, with an average payback period of 10 years.

Is Krispy Kreme a Franchise?

Yes, Krispy Kreme operates as a franchise with four distinct store models:

Franchise Models

• Factory Store:
  • Produces fresh doughnuts on-site.

  • Supplies Tunnel Oven Shops and Fresh Shops.

  • Investment: $1,287,500 to $2,750,000.

• Tunnel Oven Shop:
  • Uses specialized ovens and receives doughnuts from a Factory Store or Commissary Facility.

  • Investment: $558,500 to $1,500,000.

• Fresh Shop:

• • Limited or no manufacturing capabilities, receiving doughnuts from a Factory Store or Commissary.

  • Investment: $440,500 to $1,200,000.

• Box Shop:

• • A retail facility resembling a Krispy Kreme box with no manufacturing capabilities.

  • Receives doughnuts from a Factory Store or Commissary Facility.

Krispy Kreme is actively seeking franchisees in select U.S. cities and continues to expand internationally.

How Many Krispy Kreme Locations Are There?

As of 2024, Krispy Kreme operates over 1,600 locations globally, including 373 in the United States. The company’s international presence spans 35 countries, including key markets like Canada, Australia, and England.

Innovative Expansion

Krispy Kreme leverages e-commerce and delivery services, providing nearly 13,000 “fresh points of access” to reach more customers. This strategy has contributed to its sustained growth.

What Training Is Required to Open a Krispy Kreme?

Krispy Kreme ensures franchisees are fully prepared through a comprehensive training program:

• 65 Days of On-the-Job Training: Hands-on experience in daily operations.

• 15 Days of Classroom Instruction: Covers business management, product standards, and customer service.

• Six-Month Management Training: Available for new recruits, including housing and mentorship from upper management.

Franchisees must align with Krispy Kreme’s brand values, providing a fun and family-friendly experience.

How Much Does It Cost to Open a Krispy Kreme?

Opening a Krispy Kreme franchise requires a significant investment, which varies by store model:

Investment Ranges

• Factory Store: $1,287,500 to $2,750,000.

• Tunnel Oven Shop: $558,500 to $1,500,000.

• Fresh Shop: $440,500 to $1,200,000.

• Box Shop: Estimates not available at the time of writing.

Ongoing Fees

• Royalty Fee: 4.5% of gross sales.

• Ad Royalty Fee: 1.5% of gross sales.

Franchisees must have a net worth of $2 million and $300,000 in liquid assets. Multi-unit development requires additional financial resources.

What Is the Krispy Kreme Franchise Fee?

• Factory Store: $25,000 initial franchise fee.

• Other Models: $12,500 initial franchise fee.

These fees grant franchisees the rights to operate under the Krispy Kreme brand and access its extensive support systems.

How Much Does a Krispy Kreme Franchise Owner Make a Year?

On average, Krispy Kreme franchise owners earn approximately $275,000 annually after expenses.

Revenue Insights

• Average Annual Sales: $819,000 per franchise.

• EBITDA Margin: 16%, yielding profits around $130,000 per year.

• Payback Period: 10 years on average.

Franchise profitability depends on factors such as location, operational efficiency, and adherence to brand standards.

Pros and Cons of Owning a Krispy Kreme Franchise

Pros:

• Strong brand recognition with a global presence.

• Multiple franchise models for flexibility.

• Comprehensive training and ongoing support.

Cons:

• High initial investment requirements.

• Longer payback period compared to other franchises.

• Competitive dessert and coffee market.

Why Choose Krispy Kreme?

Krispy Kreme’s iconic brand, innovative franchise models, and strong global presence make it a top choice for entrepreneurs. Its commitment to quality, fresh production, and family-friendly experiences ensures sustained customer loyalty and profitability.

Interested in exploring more franchise opportunities? Check out our guide to 5 Low-Cost Franchises That Make $1,000,000 and discover how to maximize your investment potential!