Krispy Kreme's Turnaround Faces Three Key Risks

Krispy Kreme's turnaround is threatened by three key risks: structural weakness in its business model, execution risks, and competition from larger peers with more efficient models. The company owns and operates many of its stores, production hubs, and delivery networks, making it capital-intensive and limiting profitability. Closing underperforming stores and refranchising operations can be challenging and may not lead to meaningful cost reductions. Additionally, the company's logistics model could become a margin headwind if costs spike.