California doughnut chain closes half its stores after 13-year run

Johnny’s Doughnuts has closed three of its six California shops, ending a rapid expansion that the company says it could not financially sustain. The closures affect locations in Pacific Heights in San Francisco, Santa Rosa and Santana Row in San Jose, while the business plans to concentrate on areas with stronger sales.

Thirty-four employees will be laid off, and the San Rafael, Larkspur and Napa shops will remain open. Co-founder and CEO Craig Blum said the company had taken on more financial obligations than its business could support. Founded as a food truck in 2012, Johnny’s opened its first café in 2013; its San Jose shop had operated for only four months.