A Strategic Plan For A Little Start-Up Donut Shop To Take Down Krispy Kreme.
And Hope For Little Guys Everywhere.
By Rich Harshaw
Nothing brings joy to a Saturday morning in the Harshaw household more than a couple dozen Krispy Kreme donuts—fresh, hot, and ready to dunk in a cup of cold milk. My six locust-wannabe children can devour two dozen in approximately thirteen seconds—sprinkles and all.
So one Saturday morning when my oldest daughter reminded me she had to be at school for a band competition at 8:30, it was a perfect chance to make a run. My oldest son jumped at the chance to come with me and get the hottest of the hot right after they go through that glaze waterfall thingy. There’s nothing like father-son bonding at 240 calories and eight grams of fat per donut. Homer would be proud.
After we hastily dispatched of the flute player (more for the rest of us!), it was on to donut Shangri La. As we turned right onto Highway 26, my donut radar efficiently picked out a daring new player in the local donut scene. A new shop bearing the generic white letter sign “DONUTS” was a dead giveaway that this was a Korean-owned store. And judging by the parking lot, they weren’t experiencing the typical traffic control problems associated with Krispy Kreme grand openings. In fact, there wasn’t a single car in the lot.
My son was already locked and loaded: “Dad—check it out! A new donut shop! Let’s go there instead of Krispy Kreme. I hate Krispy Kreme. We always go to Krispy Kreme. I like the big donuts from the little shops better.”
The glaze waterfall thingy would have to wait for another day. The Koreans had just won a new customer.
No small feat considering that at approximately three miles from my house, this was the ONLY locally-owned shop in existence. Krispy Kreme had decimated the rest when they opened their mega store three or four years prior.
As we walked in, I was not surprised to see that indeed, this was a Korean shop. “Just opened?” I inquired as I approached the eager employee standing behind the counter ready to serve what appeared to be an endless and yet-untouched supply of donuts. “Three weeks open now,” came the broken-English reply. Amazing—three weeks and already the place had the look and feel of a crusty little donut shop that had been there twenty-five years.
It wasn’t dirty—but there was absolutely nothing remarkable in the entire place. The walls were all painted pale yellow, and on the left wall was the standard-issue donut shop drink cooler with sliding glass doors and an assortment of juices, milks, and energy drinks. Just past the cooler was the huge Jesus picture—the one that’s always there in these kinds of shops, unless they have the more traditional Buddha-type statues. Just below that was the seventeen-year old CD boombox playing random light rock hits from the 80s. The back wall featured a bulletin board where you could leave your business card, which caused me to think—do you really want to hire an accountant, plumber, or personal trainer you found on the bulletin board at the donut shop? A half-dozen of those flimsy little donut shop tables and chairs were in the middle of the shop for those who preferred to dine on their donuts while reading the Korean newspaper that was conveniently available. The glass cases under the counter featured a wide assortment of nice looking donuts—plus those creepy hot dog things wrapped in a bun that I’ve never really seen anyone buy.
Six dollars a dozen was the asking price on the menu board above the clerk’s head—it was the generic kind with lines on it that you can stick letters on to form whatever words and prices you want. Fancies and cream-filled would cost extra—but for regular old donuts, their price was a full dollar less than the Evil Empire was charging less than a mile down the road.
We bought my standard cache—a dozen glazed and a dozen chocolate sprinkles—plus three chocolate milks for the kiddos back home. Then, to my surprise, the lady threw in a dozen donut holes for free—a nice touch. We got out of there for just under seventeen bucks. Not too shabby.
As we drove home I couldn’t help but think that this brave little startup was doomed to be crushed by the venerable Krispy Kreme—it was only a matter of time. But it didn’t have to be this way! A savvy marketing Korean shop could take a substantial chunk out of KK’s hide if they would just employ a few simple strategies. Four strategies to be precise—detailed here for you reading pleasure, so you may be able to use them in your construction, plumber, or HVAC marketing efforts. Think of me as the holographic Princess Leah R2-D2 kept showing Luke in the original Star Wars.
Citizens, we have a plan to destroy the Evil Empire.