Spudnuts, the Potato Doughnuts: Are They Gone From Texas Forever?

The last remaining vestiges of what once was a flourishing business were apparently in Amarillo, Texas, but now even its web link reads, “Permanently closed.” The final Texas stronghold of Spudnuts is only an online memory. The Spudnuts heyday appeared to be throughout the 1950s and ’60s. Residents of Texas recall the product fondly, noting that they were wonderful—similiar to yeast donuts but even better. Many Texans even remember them being sold door to door! Can you imagine that happening now? Instead of a guy or girl showing up to survey you about your water heater costs, they instead offer you a sack of Spudnuts! What were these miracle mouthfuls of glorious carbs? Named for its potato-based mix of ingredients, Spudnuts were designed to be the perfect doughnut, in the eyes of Bob and Al Pelton, their creators.

Photo: Instagram/freshfromthefarmbc

In Lubbock, Spudnuts were sometimes sold directly to homes in local neighborhoods. During the 1960s, students at Lubbock High School were employed as Spudnuts salespeople. Customers would often buy all the Spudnuts the kids brought to their door. So what happened to what seems to have been a wildly popular franchise with a product that was making its rounds in Texas and far beyond?

In 1939, the Pelton brothers developed the Spudnut recipe and grew it into a wildly popular brand. Within months, they had started to franchise the business. Salt Lake City, Utah, was its home base, complete with a mix plant and warehouse. Their distribution center was established Cleveland, Ohio, to ensure effective product handling for the eastern U.S. By the 1950s, one could purchase a Spudnuts franchise for a mere $2,000 (which wouldn’t have been peanuts back then, but you get the picture).

Photo: Instagram/paigeobyrne

In 1952, there were 350 Spudnuts franchises through the U.S. and Canada. By 1968, the Pelton brothers sold their company and retired. At the time, their annual sales were $2 million. Spudnuts franchises also had combined annual sales of $25 million, and it was said to be the largest American doughnut franchise. However, 1979 truly signaled the end of what was known as a powerful (and tasty) empire. Pace Industries, the original purchaser from the Peltons, sold the company rights to Dakota Bake-N-Serv in 1973. As a result of some poor business decisions, the entire chain was defunct as of 1979. The franchisees were left to their own devices, with no parent company to support their efforts. At present, research indicates there are 35 remaining Spudnuts locations left open in nine states. Texas doesn’t appear to be one of them.

Photo: Instagram/ebarkus

In 2008, Douglas E. Bagley acquired the authentic Spudnut ingredient list from a former vice president and general manager at the company between 1970 and 1975. In 2012, he was in court with the MP-OTHA Corporation (Spudnuts trademark owner). In a 2014 article from the Lubbock Avalanche-Journal, Mike Patton, owner of MP-OTHA Corporation, stated that he was working to bring the brand back. He explained that he owned the Sputnuts trademark, the character trademarks, and the Mr. Spudmark trademarks. Then, in October 2015, MP-OTHA Corporation and Douglas E. Bagley settled their dispute. Bagley was allowed to continue selling the donut mix, but he was not allowed to make use of the company names. And so, the pastry that brought fond memories back for Texas residents and caused an enormous stir in small business – practically making it one of the building blocks for the “American Dream” – has made its way into the background of industry and our lives. Do you have memories of Spudnuts in your hometown? How did the Pelton brothers’ doughnuts stand up to what you know of today’s current offerings?