Key Points
- Revenue in the doughnut industry has had a CAGR of 5.9 % over the past five years reaching an estimated $9.6B in 2025
- To become a franchisee, Krispy Kreme investors should expect to spend anywhere from $440,000 to $4.1 million in initial fees.
- While Krispy Kreme enjoys strong brand recognition and a loyal following, it does not offer exclusive territories or a quick ramp up. There are many other franchise opportunities that don’t require the same level of investment.
Krispy Kreme doughnuts are hot—and not just because they come out of the oven that way. Best known for their Original Glazed® doughnut, the Krispy Kreme franchise offers a variety of decadent flavors that include Chocolate Ice Glazed, Cake Batter, and New York Cheesecake, to name a few.
Despite living in a diet-crazed culture, Americans are clamoring for these dessert-like doughnuts and other crullers. Revenue in the doughnut industry has had a compound annual growth rate of 5.9 % over the past five years reaching an estimated $9.6B in 2025, according to IBISWorld.
Krispy Kreme enjoys one of the highest market shares in the doughnut sector among competitors like Dunkin’, Duck Donuts, and Honey Dew Donuts—with plans to both grow and innovate. To keep its brand from going stale, Krispy Kreme recently overhauled its menu, adding nine new doughnut flavors and discontinuing three.
At Krispy Kreme’s 24-hour flagship store in the middle of Times Square, visitors can not only watch doughnuts being made, but can shop in a 4,500-square foot retail space. The 15-foot “Hot Light,” is always on, alerting shoppers that hot, fresh doughnuts are being made and served in-store.
How did this “hot doughnut” command such a cult following, and is now the time to invest in a Krispy Kreme franchise? Here’s what you need to know.
The History of the Krispy Kreme Franchise
A secret recipe led to the development of the Krispy Kreme Doughnut Corporation, which was founded in l937 by Vernon Rudolph. Rudolph bought this secret yeast-raised doughnut recipe from a New Orleans French chef. He rented a building in what is now historic Old Salem in Winston-Salem, North Carolina, and began selling doughnuts to local grocery stores. In the 1940s and 1950s, the Krispy Kreme recipe improved, ensuring consistency, thanks to its own mix plant and equipment. By the 1960s and early 1970s. Krispy Kreme franchises emerged in the southeastern part of the country until Rudolph’s death in 1973.
In the 1970s, it was sold to a parent company that took its focus away from doughnuts and sold them alongside soup and ice cream. In 1982, franchisees bought back the company, before it went public in 2000 as Krispy Kreme Doughnuts Inc., according to Entrepreneur. From 2004 to late 2007, Krispy Kreme did not offer franchises in the United States, according to its franchise disclosure document (FDD).
The doughnut company opened the first international store in Canada in December 2001. The first stores outside North America opened in Sydney, Australia and in London, England in 2003. Today, Kripy Kreme operates in more than 40 countries with big plans to continue global expansion.
In 2016, JAB Holding acquired Krispy Kreme for $1.5 billion, bringing it under private ownership once again. Since then, JAB has acquired other popular brands such as Panera and Einstein Brothers Bagels.
How Much Does a Krispy Kreme Franchise Cost?
Getting into a Krispy Kreme franchise is not inexpensive. Franchisees can expect to spend anywhere from $275,000 to $4 million in initial investment fees, depending on the type of store format they choose. In addition, franchisees can expect to pay 4.5% of gross sales in royalties.
Krispy Kreme offers three types of franchise formats:
Hot Light Theater Shop
The flagship of the Krispy Kreme franchise model, these full-service shops offer on-site doughnut production. Guests can experience the doughnuts being made and coming off the line hot and ready to eat.
Fresh Shop
Fresh shops are a streamlined format ideal for high-traffic retail areas, shopping centers, and urban locations. Doughnuts are produced off-site and delivered fresh daily.
Kiosks
Designed for smaller spaces, kiosks are ideal for malls, airports, colleges, and office complexes serving on-the-go customers. Lower start-up costs and minimal space requirements make kiosks an ideal entry point for franchisees.
Commissary Facilities
These are centralized production hubs that supply doughnuts to multiple retail locations throughout a region. They do not sell doughnuts for retail sale.
The franchise fee to open a Krispy Kreme franchise is:
- Traditional Shop: $25,000
- Kiosk: $7,500
- Commissary Facility: $12,500
All retail stores pay a royalty fee and contribute to advertising on the local and national levels.
Check out this year’s top rated food franchises
In comparison to its fellow doughnut franchisees, Krispy Kreme leads the doughnut pack in terms of franchise cost to entry depending on the format you choose.
However, an investment in Krispy Kreme might be worth it, thanks to its loyal following, strong brand recognition, and commitment to innovation.
The company does not disclose the typical earnings of franchises in Item 19 of the FDD. However, it will allow franchisees buying existing stores access to financial performance records for that location.
Krispy Kreme Franchise Alternatives — Investment Requirements
| FRANCHISE | FRANCHISE FEE | INVESTMENT | ROYALTY |
| Krispy Kreme | $12.5K-25K | $275K-$4M | 4.5% of sales |
| Dunkin’ | $40K-$90K | $527K-$1.8M | 5.9% of sales |
| Honey Dew Donuts | $35K | $85K- $735K | 7% of sales |
| Duck Donuts | $40K | $536K – $775K | 5-6% of sales |
| Ellianos Coffee | $30K | $672K-$1M | 6% of sales |
| Biggby Coffee | $20K | $246K-$565K | 6% of sales |
Why a Krispy Kreme Franchise Is Worth Your Investment
Loyal following
There’s a good chance that Krispy Kreme customers will stay true to their favorite doughnut shop—including yours. Thanks to its trademark flavors and fresh taste, Krispy Kreme keeps doughnut lovers coming back for more. For franchisees, this means lovers of warm, sweet confections will likely appreciate the consistency of their favorite treat.
To reward repeat customers, Krispy Kreme designed an app that allows customers to earn points toward tasty treats for every dollar spent. You can sign up for this benefit online through Krispy Kreme Rewards or download an app.
Brand recognition
Krispy Kreme is a recognizable brand, catapulted into popularity through its unique in-store experiences. And, it will continue to keep in touch with customers through mobile apps that will allow them to order, pick up, and earn rewards. More than a doughnut retailer, Krispy Kreme aims to stir up passion and evoke nostalgia.
Innovative distribution channels
The brand is partnering with big box retailers like Walmart, Costco, and Target to reach higher-traffic, higher-visibility locations. According to Yahoo Finance, only about a third of Walmart locations currently sell Krispy Kreme doughnuts, leaving room for expansion. Now might be just the right time to jump in!
No requirement to manage operations
If you’re looking to make a purely financial investment in one of its stores, Krispy Kreme allows for that. You or your managing partner are not obligated to personally participate in the direct operation of your store. Instead, you will need to appoint a general manager who can provide the direct, on-premises management needed to make it run smoothly.
Why Krispy Might Not Be the Right Brand for You
Krispy Kreme offers a lot of pluses for franchisees, but you should be aware of some requirements that may factor into your decision.
Don’t expect an exclusive
You might be the first to open a Krispy Kreme store in your area, but you could find yourself competing with another franchisee down the line. Franchisees are not granted any exclusive territory, protection, or right to a Krispy Kreme in a contiguous market, according to the company’s FDD. “We reserve the right to operate and to grant others the right to operate stores and commissary facilities at any location on such terms and conditions as we deem appropriate…” it states.
Account for a long ramp up
Depending on the store format you plan to open, you could wait up to 65 weeks between signing a franchise agreement and opening a store. It could take as long as 18 months or as little as two months to open, again depending on the format. The time may be extended or reduced depending on the location and condition of the site, the construction schedule, the extent to which an existing location will need to be renovated, the delivery schedule for equipment and supplies, and getting the necessary permits. Your managers must also complete initial training no later than 30 days before opening.
You should also be prepared to take part in 16 weeks of off-site training before you open your store. According to the FDD, franchisees should expect 40-50 hours a week of training in weeks one through eight at a store location to go over topics such as production, retail, processing, and shift management. Other training areas covered in the second half of the program include assistant general management development, shop development, general manager development and equipment usage—which all take place in Winston-Salem, North Carolina. Although training for up to four team members does not incur a cost, you are required to pay employees for any of their wages and travel expenses, according to the FDD.
Find your own financing
If you’re hoping to get loan assistance from the Krispy Kreme corporate office, you’ll be disappointed. The company does not offer any direct or indirect financing to franchisees.
If Krispy Kreme doesn’t quite strike the right flavor for you, there are plenty of other food franchise alternatives that offer a lower barrier to entry and deliver tasty investment options.
Check Out Some Delicious Contenders
Biggby Coffee
- Started by two friends for the simple purpose of loving people and sharing great coffee, Biggby Coffee opened its first location in Michigan in 1995 and began franchising in 1999.
- Includes more than 430 locations across the Midwestern and Southeastern United States.
- Initial franchise fee: ranges from $20,000
- Initial investment starts at $246,305, with the maximum estimated to be $564,626.
Learn About Biggby Coffee here.
Kona Ice
- Bring the cool taste of the tropics wherever you go! More than an ice cream truck, a Kona Ice truck delivers a fun experience for customers.
- Founded in 2007 in Florence, Kentucky and began franchising in 2008
- Includes more than 1,600 locations throughout the United States
- Franchise fee: $15,000
- Initial investment ranges from $149,995 – $189.300
- Rated number one for several years in a row on FBR’s Top Franchises List
Download the Kona Ice owner satisfaction report.
Checkers & Rally’s
- Since 1986, Checkers & Rally’s has been serving American classics such as hot dogs, hamburgers, and milkshakes to millions of happy customers.
- Headquartered in Tampa, the restaurant has been franchising since 1989.
- Includes more than 760 locations.
- Franchise fee: $20,000 to $30,000
- Initial investment: $639,998 – $2,777,950
- Recognized as a Top Franchise by Franchise Business Review
Learn more about Checkers & Rallys here.
Nothing Bundt Cakes
- Started by two moms in their Las Vegas home kitchens in 1997
- Known for signature cakes made with premium ingredients and unique decorations
- Includes over 500 locations across the U.S. and Canada
- Initial franchise fee: $45,000
- Total Startup Investment: $440,800 – $636,500
- Recognized as a Top Food Franchise by Franchise Business Review
Learn more about Nothing Bundt Cakes here.
Ready, Set, Dough!
A Krispy Kreme franchise could prove to be a delicious opportunity. But with so many franchise opportunities to choose from, we recommend you explore multiple franchises and perform extensive due diligence. Even the sweetest opportunities demand careful research. Remember to:
- Compare different franchising options
- Weigh franchising costs relative to profits
- Ask for feedback from current franchise owners
- Look at independent ratings and reviews from unbiased sources
- Be honest with yourself about how much time and effort you can put into it
Start your research by perusing our list of the Top Franchises. Each year, Franchise Business Review surveys over 35,000 franchisees to identify the top-rated franchise opportunities based on owner satisfaction. Many of them make their satisfaction reports publicly available on our site so you can see how they rate their franchise experience in eight key areas critical to owner success.
