A major US donut chain owned by Australia, Krispy Kreme has taken major restructuring steps and surprised everyone with the decision to close almost half of its retail outlets.

The chain has decided to shut down its underperforming stores that were adversely affecting the business. 35 of the 59 stores would still be operating with improved sales and customer support.

The stores were closed because of decline in sales and increased rental and distribution costs.

John McGuigan the chairman of Krispy Kreme further added that the company would now be able to focus more on their existing performing retail stores. This shutdown of 24 stores has caused 201 full time and part-time as well as casual workers to lose their jobs.

The employees losing their jobs are slated to get full pay. The amount for their pay will be arranged from the deed fund.

The provision of the deed fund of $2.3 million has already been done with the help of creditors.