Krispy Kreme and Wal-Mart

Krispy Kreme is partnering with Wal-Mart.

Krispy Kreme Doughnuts Inc. (KKD) on Thursday plans to open test stores in five Wal-Mart locations by the end of October, a spokeswoman said on Thursday.

Wal-Mart Stores Inc. (WMT) "has a booming business, and we thought we would try to combine their market with our market," Krispy Kreme spokeswoman Robin Pfefferkorn said.

It's a nice idea to boost sales, but I'm not sure a product with a cult-like status can benefit long-term by associating itself with Wal-Mart. I wrote about this before when Levi's inked a deal with Wal-Mart. If I were Krispy Kreme, I'd rather sell my doughnuts in Starbucks. I think this is a gamble and could go either way. It really depends on how much people demand the doughnuts once they become more common.

Thanks to Beth for the link.

UPDATE: WSJ has an article in the Money section on Krispy Kreme same store sales being down. Management, of course, dismisses it, but it does make one wonder what will happen if the buzz wears off.