The Krispy Kreme franchise in Panama makes the most out of the global support from the company’s headquarters and brings its own creative twist, delivering astonishing results
The Krispy Kreme brand was created more than 80 years ago in North Carolina, with the original glazed donut as its cornerstone. Throughout the years, the company’s expansion has led to presence in more than 35 countries.
The successful run for the Krispy Kreme franchise in Panama began with the opening of its first store in 2017, located in the Costa del Este exclusive residential area. Five years later, Krispy Kreme has nine stores in Panama City.
Before the first location opened its doors, the Bárcenas Group worked for two years in preparation to launch the brand after obtaining authorization on behalf of Krispy Kreme to operate the franchise in Panama.
The store’s opening attracted lines of 500 to 600 customers, eager to purchase Krispy Kreme products. This earned Krispy Kreme Panama the Best Opening Worldwide award in 2017, on behalf of the company’s headquarters.
“This event thrusted us into the news for weeks after the opening,” commented Eduardo Escobar, General Manager of Krispy Kreme in Panama.
Creative, experienced leadership
Originally from El Salvador, Eduardo Escobar earned a Bachelor’s degree in Marketing from Dr. José Matías Delgado University, in his home country. Escobar also obtained an MBA from the Francisco de Vitoria University (Madrid, Spain). His body of work includes stints in industries such as real estate, advertising and for global brands such as Pizza Hut (in El Salvador and Guatemala), KFC (Guatemala) and for Krispy Kreme, in Panama.
Besides the award for Best Opening Worldwide award in 2017 and a “Melonhead” for achievements in innovation -both from Krispy Kreme-, Escobar was selected by Central America’s “Estrategia y Negocios” magazine as one of the 100 leaders in marketing for this territory after introducing Krispy Kreme in Panama.
Standards and flexibility
Krispy Kreme is no different from other franchises in regards to keeping every single detail consistent with the brand’s concepts besides product quality.
But the brand’s flexibility allows blending with local culture to improve its positioning, allowing also adaptations into local vernacular along other efforts contributing to reaching the brand’s target audience.
One of the brilliant strategies linking the brand with the city of Panama’s inhabitants was the activation campaign in which entire boxes filled with products derived from new hires’ training sessions. These giveaways took place in popular places in town, shopping centers, points of interest, plazas, busy streets and avenues.
A timely, transparent operation
The joy for Krispy Kreme products lies in its freshness, the bakery delivers new products twice a day (mornings and evenings), guaranteeing freshness to every customer.
Most of the Krispy Kreme locations open to the public are also bakeries, and customers can take their children to witness the production process before buying just-baked products. Bakery stores display a “Hot Now” neon sign, letting customers know that doughnuts are just leaving the production line.
Dark kitchen, an award-winning strategy
Krispy Kreme’s headquarters also displayed its flexibility by allowing the Panama franchise to run its “dark kitchen”, a model which -with more or less variations, even in the concept’s name- has gained popularity in the industry. The Panamanian operation developed hidden stores which increased coverage for delivery orders.
The strategy consisted in renting low-cost properties where finished products are delivered every day and set up to prepare beverages from the menu without being open to the public. These locations are intended for delivery-only purchases.
The dark kitchen strategy earned an award for innovation from the brand’s headquarters in early 2021.
Centralized supply for quality control
Consumables and materials for preparation of Krispy Kreme products are centralized in the company headquarters in North Carolina, ensuring the best available ingredients for each donut’s production. Global orders are collected and sent on consolidated freight in high volumes. The company deals directly with suppliers, which results in all ingredients being imported into Panama. Making these goods reach its final destination is a different matter.
“In this part is where local strategic partners rise to the occasion, as it happens with our raw material distributor. Our specialty is creating experiences, making donuts and selling them, theirs is logistics,” the executive explained.
Global support network
As well as global standards are carefully maintained as a brand, in the same way Krispy Kreme offers wide support in every area to its affiliates, be it training, marketing, operations, human resources and others, including location architecture, maintaining the same quality in every market for product quality, brand identity and other matters.
Each department in every country can access the staff at the headquarters directly to deal with specific subjects in every area.
The data exchange is a key aspect, as the company shares specific KPIs monthly, with leading markets exchanging information to be applied in countries with room for improvement in certain aspects, adding to best practices. This way, information does not flow only between headquarters and global locations, but also among operations in each country.
“We are able to propose pilot programs, and if one of them works, then these are escalable at a global level; like the dark kitchens, a program we were authorized to test-run, it worked, we earned an award, and now it’s going to be implemented worldwide,” Escobar declared.
Surpassing the pandemic
Consequences from COVID19 were felt worldwide. Panama stands out for having enforced very strict measures, including a six-month quarantine when the pandemic just began.
Compliance with these measures implied a halt in operations until the government began to allow a gradual opening to essential activities. Krispy Kreme Panama first reopened once a week, then twice a week, until the operation could run on a daily basis again.
Within the company, some movements contributed to discovering new skills within the hired staff, which shares a commitment to pull together through difficult times and has positively transformed some habits.
“The pandemic contributed to reinventing ourselves as a company, to reinvent processes, to reinvent our structure,” the executive added.
New hires with a purpose
Krispy Kreme’s support to its personnel in Panama is displayed with actions going farther than existing commitments by law. The company has gone the extra mile for employees that also deliver an extra effort. One of these examples came when not every employee qualified for government’s stimulus payment during the pandemic, and the company stepped up to make sure the entire staff could take home that same amount of money.
But probably the most notable contribution Krispy Kreme provides to its staff is the future plans for new hires, considering mid- and long-term paths. The company plans the possibility of climbing to new positions since prospect evaluation and hiring. This strategy has delivered valuable results not only in operational positions, but also for management roles, as there are team members who have reached mid-management positions after entering the company two levels below.
“The company has a focus on its staff, we know that the company’s strength and heart lies within the people working for us,” Escobar commented.
Expansion and challenges
Beyond previously-set goals, the pandemic became a game-changer in every industry. In Panama’s case, Krispy Kreme’s strongest competitor, precisely in the doughnut specialty, closed its operations countrywide, which does not necessarily translate into good news, since it was also a global brand. This drove Krispy Kreme Panama into setting a series of challenges in which its main reference is its own operation.
On one side, a 100% recovery plan was set for 2021, reaching the same production level. This goal is being achieved successfully. And the other goal is to keep expanding the business along Panama, going beyond the nine stores currently operating in the country’s capital.
The management’s vision is to keep evolving, coming up with better ideas to remain in the market as a relevant, appealing brand, far from believing that less competition will turn them into the only option for consumers.
“The challenge for ourselves is to innovate and reinvent ourselves continuously,” concluded Eduardo Escobar, General Manager for Krispy Kreme in Panama.