Dive Brief:
- McDonald’s will sell Krispy Kreme donuts at nine restaurants in Louisville, Kentucky, and surrounding areas starting Oct. 26, the companies announced Tuesday. The companies didn’t disclose when the test will end.
- The Golden Arches will offer Krispy Kreme’s Original Glazed Doughnut, Chocolate Iced Sprinkles Doughnut and Raspberry Filled Doughnut across all dayparts for in-restaurant and drive-thru service while supplies last.
- Krispy Kreme will deliver fresh doughnuts daily to participating McDonald’s restaurants for the duration of the test, which McDonald’s will leverage to inform future menu and operations strategy, the company said.
Dive Insight:
By bolting Krispy Kreme products on to its menu, McDonald’s could bolster its breakfast business and protect morning customer traffic that might otherwise be lost to nearby Krispy Kreme units. Though the doughnut chain’s store network is dwarfed by McDonald’s sprawling footprint, Krispy Kreme could eventually prove a strong morning daypart competitor.
Krispy Kreme is expanding via a hub-and-spoke growth model, wherein the chain’s production centers deliver doughnuts to local retailers and convenience stores. Earlier this year, the company announced it would build delivery-only units in the U.S to take advantage of this capacity.
Still, breakfast was McDonald’s strongest-performing daypart in Q2, CEO Chris Kempczinski said on the company’s earnings call in July. McDonald’s already offers four pastries, as part of its McCafe menu, though not a doughnut product. It brought back its cheese Danish as an LTO during the fall, and added Donut Sticks in 2019 as an LTO. Golden Arches customers can order Krispy Kreme doughnuts individually or in a pack of six during the test.
