Los Angeles Business Journal

Local Krispy Kreme Franchisee Plans Major Expansion

By Deborah Crowe Tuesday, January 21, 2014

Krispy Kreme Doughnuts Inc. on Tuesday announced that its longtime Southern California franchisee plans to develop 20 new doughnut shops in the region in the next seven years.

Great Circle Family Foods of Long Beach has signed a new development agreement with the Winston-Salem, N.C. company. Great Circle has been developing and operating Krispy Kreme stores for the Winston-Salem, N.C. restaurant company since 1998, and was Krispy Kreme’s first big franchisee west of the Mississippi.

"We are thrilled to be growing our business in Southern California," Great Circle Chief Executive Roger Glickman said in a statement. "This commitment for an additional 20 stores is a reflection of our success with the Krispy Kreme brand, our outstanding, system-leading same store sales growth, and our confidence in the small factory shop model."

Great Circle Family Foods now operates 11 shops in Southern California, far below the more than 30 outlets it had at the height of Krispy Kreme’s domestic and international expansion spurt in the early to mid-2000s. The parent company, whose stock was once a Wall Street darling, fell victim to overly aggressive growth expectations. Great Circle suffered along with it, suing the company in 2005 and filing for Chapter 11 reorganization in 2008.

The companies in 2006 settled litigation, and Great Circle today is Krispy Kreme’s third largest domestic franchisee.

Krispy Kreme, which had 812 predominately franchised shops in 23 counties as of Sept. 30, has set a goal of 900 international stores and more than 400 domestic shops by the end of fiscal 2017.