Watch this video on Gerry Thomas – The South African Krispy Kreme SA Managing Director.
- Player: Gerry Thomas
- Position: Managing Director
- Company: Krispy Kreme South Africa
- Visit: krispykremesa.com
How did the establishment of Krispy Kreme SA take place?
It literally started with a call. The guys behind the brand in the US wanted to bring it to South Africa, and contacted us at John and Gerry’s Brands. We ended up partnering with Fournews to bring the brand to South Africa. Luckily, it was a good fit.
Krispy Kreme in the US liked what Fournews and John and Gerry’s could bring to the table, and we were really impressed with the brand.
Related: Krispy Kreme to Open in Johannesburg
What did you like about the brand?
We loved the product. It was clear that Krispy Kreme offered great-quality products, and that it had a business model that allowed it to offer this product at a very competitive price.
Price point is incredibly important, and we knew that we could offer a premium product locally at a very competitive price.
How did you know that Krispy Kreme was a brand that could work in SA?
We did our homework. We looked at countries that had a similar market to South Africa, and realised that Krispy Kreme was doing well there. We also realised that we were dealing with a strong brand. It’s been going since 1937 and is now present in around 30 countries. It has shown that it has international appeal.
Can you expand on how Krispy Kreme SA is structured locally?
Krispy Kreme SA is a joint venture between John and Gerry’s Brands and Fournews. Krispy Kreme SA is a master licensee with the right to develop the brand here, but not to franchise the business, which means that we will be directly responsible for opening every store. We are the exclusive franchisees, in other words.
What will the expansion of the brand locally look like?
According to our agreement with Krispy Kreme in the US, we need to open 31 stores within the next five years. Although baking takes place at our flagship Rosebank store, other stores are supplied by a production hub that is located in Linbro Park, Sandton.
We envision every hub supplying five to ten stores. For now, we are focusing on stores that can be supplied from this hub. In time, though, we will branch out and set up hubs and stores throughout the country.
Setting up production hubs and stores must be expensive, especially considering that the business is not being franchised locally. How have you dealt with this?
We are a capital intensive business. Moreover, we’re a private company and the shareholders have had to find ways to fund it. Luckily, we’ve found an excellent partner in Nedbank.
They understand the nature of our business and the industry we operate in, and they are very familiar with the funding requirements of this sort of operation.
We still have more than 20 stores to open locally, so we look forward to a long and fruitful relationship with Nedbank.
What in particular was it about Nedbank that appealed?
Well, I think it’s important to have a specialist partner that truly understands your business. You want someone who is a trusted partner — who can help guide you in your journey. Nedbank is great at offering tailored solutions and excellent advice.