Mr. Livengood is confident that the formula will work — even in Canada, a country that has more doughnut shops per capita than anywhere in the world. He has committed to building 31 more outlets over the next six years at a cost of $1.2-million (U.S.) each.
The Globe and Mail
December 12, 2001
Krispy Kreme store mobbed
Food frenzy attends doughnut firm’s first Canadian opening in Mississauga
Oliver Bertin
MISSISSAUGA — It was a feeding frenzy yesterday as Krispy Kreme Doughnuts Inc. opened in Canada for the first time.
Six people camped out overnight so they could be first in the door. Cars were backed up for a kilometre as a platoon of harried police officers tried to prevent rush-hour gridlock. People pushed and shoved to get into line, and then waited for an hour to reach the counter.
And Krispy Kreme sold more than 25,000 doughnuts before 10 a.m., when the store officially opened in Mississauga.
"It's almost cultish," said restaurant consultant Geoff Wilson of Mississauga. "People take them home and gorge on them."
That's quite all right with Scott Livengood, chairman, president and chief executive officer, who came up from head office in Winston-Salem, N.C., to oversee the launch.
He watched as dozens of staff herded customers through the crowded store, past the cash register and out the door, beaming as they carried boxes of doughnuts in their arms.
"I absolutely love them," said Tra-Lissa Hastings, who queued with her mother-in-law for 45 minutes in the early-morning cold. "They melt in your mouth."
"I take them home and freeze them," said her mother-in-law, Sharon Hastings, as the two women walked out the door carrying four dozen doughnuts between them. "I even eat them cold."
John Parry drove for an hour from Barrie, Ont., to buy the first Krispy Kreme doughnuts to be sold in Canada. "I've been on a diet for a year," he joked. "I'm off the diet as of now."
He saw nothing strange about driving that far just to buy a doughnut. "It's an absolutely different doughnut from everything else," he said as he carried three dozen to his car.
Food experts are at a loss to explain the huge crowds that Krispy Kreme seems to attract whenever it opens a new store. But they know that whatever the company is doing seems to work.
"I'm totally convinced they will do well," said Bill Dover, a food expert with Dover Hospitality Consulting Inc. of Toronto. "It's almost a cult."
Like other experts, he said Krispy Kreme has a good, if not universally acceptable, product. The doughnuts are made of a special, secret mix that is deep-fried to produce a featherweight doughnnut covered in liquid sugar.
The doughnuts taste of fat and sugar and not much else. But experts say they are a niche product with a loyal following.
"It's a very narrow, decadent, specialty product that you buy once a month at a premium price," said Patrick Gibbons, president of rival chain Country Style Food Services Inc. But he admits that the formula works.
The Krispy Kreme in Mississauga is charging $5.99 for a dozen of its doughnuts — $10.99 for two dozen. That's 35 per cent more than at least one of its competitors charges.
Like several experts, Mr. Gibbons said the secret to Krispy Kreme's success is the atmosphere in the stores, not the taste of the doughnuts.
"They are selling animation," he said, speaking of the lively buzz, the music and the singing staff. "They have more animation in their stores at midnight than we have during the day."
Mr. Livengood doesn't disagree. Ask him why Krispy Kreme is successful, and he uses words like "experience" as often as he mentions "taste."
"Krispy Kreme is a cultural experience, a multidimensional experience," Mr. Livengood said. "People come for the aroma of coffee, the visual theatre. They come to watch the people.
"They see doughnuts rising through the proof box. It's almost a Circadian rhythm. It's a stimulating visual presentation."
He talks about "wholesome food in a clean environment." But he makes no claims to produce a healthy product. "I didn't say 'healthy,' " he corrects a questioner. "I said wholesome."
After all, one Krispy Kreme doughnnut reportedly contains 210 calories, 12 grams of fat, 13 grams of sugar and no fibre. And that's about 30 per cent more sugar, fat and calories than the typical Canadian product.
Mr. Livengood is confident that the formula will work — even in Canada, a country that has more doughnut shops per capita than anywhere in the world.
He has committed to building 31 more outlets over the next six years at a cost of $1.2-million (U.S.) each.
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Risks: Development deal hype, Pump-and-dump scheme, More doughnut shops per capita than anywhere in the world, Pundit accuracy, Development deal collapses before risk shifted from investors to sub franchisees, Canada, 20011212 Krispy Kreme
