National Donut Day: Sweet treats, sweeter payback for companies

Consider, while on your third doughnut of the morning, the massive industry behind the popular pastries celebrated Friday on National Donut Day and by police officers and Homer Simpson on every other day.

The holiday, which takes place on the first Friday of June, was launched in 1938 by the Salvation Army to honor the women who served the humble treats to soldiers during the First World War. Today, chains such as Dunkin’ Donuts and Krispy Kreme are offering free doughnuts.

Also sold as paczki, beignets, berliners, holes and more, doughnuts by any other name are just as sweet. The fried dough is also quite lucrative, forming a nearly $700-million industry in the U.S.

Doughnuts make up some 7.4% of bakery sales, according to the Perishables Group Inc. And they’re only becoming more popular (so much for the nationwide push to eat more healthfully).

Restaurants such as Umamicatessen in downtown Los Angeles are serving foie gras-stuffed doughnuts. Other upscale doughnuts have steadily emerged on eatery menus around the country. Some brave analysts even dare suggest that the doughnut may surpass the cupcake as the next culinary craze.

Each week, the average store brings in $757 from doughnut sales – a 5.1% increase in 2011 from the previous year. From 2006 to 2010, they’ve increased about 5% overall.

That’s partly because doughnuts – specifically the yeast used to make them – are getting more expensive. Sales also tend to spike during holidays such as Mardi Gras.

Same-store sales at Krispy Kreme Doughnuts Inc. rose 2.1% in the first quarter ended April 29 – the 14th consecutive quarterly increase. Overall revenue was up 3.7% to $108.5 million.

The company will celebrate its 75th birthday in July. Among its initiatives for staying fresh: branching into more remote markets by building smaller factory stores with full doughnut-making capabilities.

Competitor Dunkin’ Brands recently opened its only Dunkin’ Donuts store in California in Camp Pendleton. In its first quarter, which ended March 31, same-store sales at the coffee-and-doughnut cafes soared 7.2%.

Doughnut stores overall will become a $11.6 billion industry in 2012 by selling coffee and other products, according to research group IBISWorld. By 2017, analysts expect revenue to grow to $13.9 billion as major chains cannibalize smaller independent doughnut stores.

Such shops are also boosting revenue, which is expected to jump 8.2% this year alone, by offering smaller doughnuts with fewer calories and less fat to appeal to health-conscious consumers.

RELATED:

Have a doughnut, or two, and celebrate National Donut Day

What the foie gras? Man meets jelly doughnut at Umamicatessen

Follow Tiffany Hsu on Twitter and Google+