Why Your Local Krispy Kreme May Shut Down Soon

The Real Reason Your Neighborhood Krispy Kreme Might Close Not too far from now

Based on their website, Krispy Kreme has been delivering glazed, warm donuts for more than 75 years. Vernon Rudolph started manufacturing donuts using a secret yeast-raised technique, opening its doors in North Carolina in 1937. To allow him to offer fresh donuts straight to consumers walking by, he dug out a hole in one of the store's walls, causing traffic to line-up. Its popularity soared, and today Krispy Kreme has more than 700 stores all around offering a range of donuts and coffee.

Usually indicating fresh, hot donuts are ready to buy, whether for late-night cravings or a delicious start to your morning, Krispy Kreme's trademark neon sign is a staple at most establishments. Sadly, that brilliant neon sign could not be seen in your area for much longer; Krispy Kreme just said that it will be closing many outlets all over.

Reduced earnings results in store closings.

Michael J. Tattersfield, CEO of Krispy Kreme, said on August that underperformance and decreased earnings will cause Krispy Kreme to review its business model and close numerous outlets, reported Food Business News.

At the moment, Krispy Kreme runs under a hub-and-spoke strategy. One store is the "hub" that gets most items in a shipment; the other "spoke" retailers obtain their products from the hub to distribute (via Bizfluent). Though these are the stores most likely to be closing—they reportedly grew 5% slower than hubs running without spokes.

Of the 118 hubs-without-spokes sites around the country, 10 will be closing in the next months, according to Joshua Charlesworth, COO and CFO of Krispy Kreme, according Food Business News. The firm did say that the locations have been underperforming, hence if you find your local Krispy Kreme looking emptier than normal, stock up on treats while you can. The company has not yet said which stores would be closing their doors.