We expanded too quickly,
Craig Blum, co-founder and CEO of Johnny Doughnuts, told the San Francisco Chronicle.
The California doughnut chain is closing half of its six locations as it attempts to refocus on its core operations, according to reports from the San Francisco Chronicle and SFGATE.
Three locations to close
The closures, which began Monday, affect shops in San Francisco’s Pacific Heights, Santa Rosa, and Santana Row in San Jose, the San Francisco Chronicle reported. The Santa Rosa shop is located at 1200 4th Street, and the San Francisco location was at 2404 California St.
The downsizing will result in the layoff of 34 employees, according to the San Francisco Chronicle.
Sara Segal, a spokesperson for the company, told The Press Democrat that the remaining stores will continue to operate as usual, and the company’s catering and events business will proceed as planned.
Segal noted that no further layoffs are currently being considered for the three remaining sites. She added that the company is deeply grateful
to its partners, customers, and staff, and is dedicated to supporting those impacted by the closures.
Financial obligations drove decision
The owners informed customers via email on Monday that the company had taken on more financial obligations than the business could carry over the last two years, SFGATE reported. In the message, Blum and Diamond stated, That’s on us. We’ve spent a lot of time asking ourselves what Johnny needs to be healthy for many years to come. Focusing on our core shops is our answer.
Blum, who co-founded the chain with Kim Diamond, said the decision involved many tears shed and sleepless nights,
the San Francisco Chronicle reported. He added, The business couldn’t support all these operations going forward,
He also noted, The road ahead will take work, but we’re committed to it, and we’re grateful you’re here with us.
History of expansion
The company’s recipes utilize 1920s techniques and incorporate fresh potatoes into the dough to create a specific texture.
The company expanded to Hayes Valley in 2017 and Larkspur in 2018. While the Hayes Valley location closed in 2022, the company opened shops in Santa Rosa in 2021 and Pacific Heights in 2022. The chain also previously planned for expansion into the East Bay and Petaluma, though those plans did not materialize.
The chain added two new locations this summer, with the San Jose shop debuting in June and the Napa location opening in August, SFGATE reported.
The menu includes vegan and wheat-free options, along with signature items like a raspberry jam-filled bismark, a chocolate salted caramel old-fashioned, and a “crodough,” which is a croissant-doughnut hybrid. The chain also serves tea, coffee, and espresso, utilizing local ingredients such as Clover dairy from Sonoma and Central Milling flour from Petaluma.
The business has received various accolades, including being ranked among the top five doughnut shops in the country by the Food Network in 2015. It was also named to the Chronicle’s 2025 Top Doughnuts list, where critic Cesar Hernandez noted the styles are all worth exploring.
Additionally, readers of the Press Democrat selected the shop for the Best of Sonoma County list in 2022 and 2023.
We are a small company, and we’re really determined to continue to serve the communities that we’ve been involved with for so long,
Blum said, according to the San Francisco Chronicle. We’re not trying to be hip and fancy.