Krispy Kreme donuts are coming to McDonald's

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Donuts will be displayed for sale at a Krispy Kreme store in Austin, Texas on February 13, 2024.


New York
CNN

McDonald's customers may soon be pairing Krispy Kreme donuts with their morning McCafe in a new food partnership that seeks to expand both brands but instead weaken them.

Three varieties of Krispy Kreme donuts — original glazed, chocolate ice sprinkles and chocolate iced “cream” filling — will be available at McDonald's restaurants starting later this year, the companies told CNN on Monday.

Krispy Kreme shares were up about 18% Tuesday morning. Shares of McDonald's lost 0.2%.

This is not the first time the two rivals have teamed up. For example, Wendy's has brought cinnamon to its breakfast line Earlier this year. Some studies suggest that Brand partnerships open opportunities for new customers, brand extensions and innovations. But some retail experts suggest the partnership could be a risky move and one that could weaken the respective brand names.

Krispy Kreme's donut delivery model must find a way to successfully serve rural McDonald's locations 20 miles outside the urban core, analysts said.

McDonald's has also faced pushback from customers as the prices of its other menu items have risen. Ian Borden, McDonald's chief financial officer, said earlier this month Some low-income Americans choose to cook at home instead of eating out at its restaurants. In February, CEO Chris Kempczynski addressed McDonald's “affordability” problem and He indicated that the chain would lower prices In some menu items.

To celebrate the partnership, Krispy Kreme is offering a free glazed donut to guests who visit a Krispy Kreme location on Tuesday from 5 to 9 p.m.

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McDonald's began testing customers' breakfast orders with a Krispy Kreme donut at 160 restaurants in Kentucky. After a phased rollout starting later this year, the donuts will be available at participating restaurants nationwide by the end of 2026. A longer trial period reduces risk for both parties, analysts said.

The donuts will be available for purchase individually or in a six-pack, beginning at breakfast and continuing until supplies last.

There are far fewer Krispy Kreme locations than McDonald's 13,500 US locations In 2022. But customers can buy the Krispy Kreme donut at other locations, such as Walmart and other grocery stores. The partnership could increase the scope of Krispy Kreme, which has said it is scaling its supply chain to continue its promise to deliver fresh daily.

“By making Kreme Krispy (sic) accessible to fans across the country through this partnership, we expect to double our access points by the end of 2026,” Krispy Kreme President and CEO Josh Charlesworth said in a statement.

Krispy Kreme has been focusing its business operations on its donuts. The Charlotte-based company also has insomnia cookies It said it is exploring other options, such as selling the cookie brand in 2023.

The company returned to the market with an IPO in 2021. However, its The stock is still trading below its IPO price of $17.

“What does this mean for the company's previous plans to expand locations? How will it affect the existing access point on MacDonald Street?” Trust analysts said.

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