"KrispyKremeBusiness" news and stories

Recently, Moody's investor service listed several companies that, it predicts, will probably not survive 2009. While most of them aren't all that interesting, three key ones caught my eye, as well as my tastebuds. Not only are they endangered; the key three are also popular food joints.

Moody's argues that Krispy Kreme's problems come from an over-expansion during the 1990's, and note that the chain hasn't shown a profit in three years. Of course, it's also worth pointing out that every bite of KK deliciousness comes with a hearty helping of sugar, fat, and calories. Even with the chain's announcement that it has cut out trans-fats, it's still hard to connect donuts to a healthy diet. For consumers who are becoming increasingly conscious of the poisons in their food, Krispy Kreme is becoming a tough sell.

The same goes for Sbarro. Moody's points out that many of the pizza seller's outlets are located in malls, which are experiencing very tough times. Moreover, Sbarro apparently has a much higher debt-to-cash ratio than competitors Pizza Hut and Dominos, which also hurts its chances of surviving the recession. What Moody's forgets to point out is that Sbarro's pizza is, frankly, foul. It is a heavy, dull, palate-deadening travesty that is generally foisted on the unwilling, the unwise, and the insensate. There's a reason that Sbarro outlets are rarely located near competing pizzerias: even substandard crud like Domino's tastes like ambrosia when served next to their horrifyingly foul pizza blasphemies.

According to Moody's, Landry's Restaurants basically needs $400 million to finalize a merger that it initiated last year; if it doesn't come up with the money, it will presumably go bankrupt. The other side of this, which Moody's neglected to mention, is that the company, which owns the Rainforest Cafe and Chart House chains, is latched into the low-level eatery niche. With customers cutting back expenses, Landry's is probably finding itself in competition with Mickey D's or even (horrors!) home cooking.

So there it is: the good, the bad, and the ugly; three food retailers that, according to Moody's, probably won't survive the recession. I'm going to miss Krispy Kreme...