How much would you pay for a dozen Krispy Kreme doughnuts?
Minnesota college student Jayson Gonzalez found out the answer to that question earlier this year when he found an unexpected business opportunity.
Minnesota residents desperately wanted Krispy Kreme doughnuts despite the fact that there weren’t any stores nearby. So desperate, they were willing to pay about double the retail price for a box of a dozen.
Gonzalez started making weekly drives to Clive, Iowa, about four hours each way, so that he could meet the desperate need. He would buy around a hundred boxes (of a dozen doughnuts each) to resell on the way back.
Krispy Kreme might have applauded Gonzalez’s spirit of entrepreneurship, and the fact that they were selling an additional 1,200 donuts every week to customers outside its normal area of operation.
Instead, Krispy Kreme contacted Gonzalez and told him to shut down.
Gonzalez, a 21-year-old who studies accounting at Metropolitan State University, traveled with the youth soccer team he was coaching for a tournament. When he saw a Krispy Kreme, he posted a message on Facebook asking if anyone wanted him to bring them back some doughnuts.
“I kid you not, a couple days later, I had over 300 replies,” Gonzalez told Deanna Weniger, a reporter with the Twin Cities Pioneer Press.
And so, a great business was born.
Weniger shared details of the operation: Gonzales takes orders via a Facebook page, “Krispy Kreme Run Minnesota.” He emails the manager at the Krispy Kreme in Clive, Iowa, to make sure the large order of about 100 boxes will be ready when he arrives. Then, he wakes up before 2 a.m., which is when he begins the four-hour drive (about 250 miles) to Clive, where he loads up his Ford Focus with the 100 boxes.
On the return drive to the Twin Cities, Gonzalez makes eight stops, mostly in Target parking lots. After parking his car, he puts a Krispy Kreme bag on the roof as a signal to customers. Cars pull up within minutes.
Gonzalez became known as “the doughnut guy,” and he sells the doughnuts for between $17 to $20 per box. (A dozen “original glazed” doughnuts currently retails for around $7.99. That makes for a profit of about $9 to $12 a box, minus gasoline costs, car wear and tear, and of course, labor.
Less than a week after the Pioneer Press ran the original story, Gonzalez told Weniger that “one of the big managers” called him, and corporate said he should “cease and desist.”
Gonzalez responded with remarkable emotional intelligence.
“It was never my intent to make Krispy Kreme seem like the bad person, or the bad company, in this scenario,” Gonzalez said in a video posted to Facebook. “It is kind of upsetting that I had to stop, but it is what it is.”
“One opportunity closes, another one will open,” he continued. “But we’ll kind of just see where we go and what happens and, who knows? Something amazing could happen from it…. But whatever happens, I’m always willing to embrace it. Always looking for the positive.”
News outlets around the country picked up the story: The big, bad corporation crushing the entrepreneurial dreams of a single college kid.
And then, Krispy Kreme realized it had made a huge mistake.
“We have become aware of Jayson’s situation, which involves one of our well-intended locations, and are looking into this,” the company told Weniger in a statement on Sunday. “We appreciate Jayson’s passion for Krispy Kreme and his entrepreneurial spirit as he pursues his education.”