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“People don’t just go to an ice cream store because they’re hungry,” says Amy Simmons. “They go because they’re happy or because they want to celebrate or because they’re going on a date. It can be a reward. There’s something about it that’s just bigger than a food.”
Ice cream and frozen dessert franchises offer a fun business model and a sweet way for investors to chase their professional goals.
Ice cream brings people together, either for celebrations or simply when they want to enjoy a sweet treat. Additionally, many ice cream franchises offer the opportunity for community involvement. Franchises in this area often contribute to their communities by fundraising for charity, giving out free ice cream, and hosting family fun events throughout the year.
In general, ice cream parlors can be traced back to France, while the predecessor to the modern-day ice cream shop made its first appearance in the United States in the late 1700s. The beginnings of the ice cream franchise industry, specifically, can be traced to the late 1940s—and the industry has developed in many ways over the years.
here are very few Americans who don’t love ice cream and frozen desserts. These days, the demand for ice cream extends throughout the year, rather than remaining confined to the hot summer months.
Many ice cream franchise businesses have broadened their menu offerings beyond ice cream to include gourmet coffee and delicious baked goods such as breads, bagels, pretzels, and cakes.
But the big draw for the American public is the ice cream – and, although we love our vanilla, we go crazy for wild and wacky flavor combinations.
However, according to YouGov, the favorites are the traditional choices; chocolate is the top favorite, followed by vanilla, then strawberry. So, it’s never wise to ignore the basics! The ice cream franchises that really thrive build on those primary flavors and take them to new heights.
Franchise models (and non-franchised) ice cream stores now range from kiosks and ice cream trucks to store locations in retail centers. Franchises within this industry also can serve their namesake product along with milkshakes, smoothies, and a variety of desserts such as cake. Other related businesses within the industry include Italian ice, gelato (an Italian frozen yogurt similar to ice cream), and shaved ice (snow cone) franchises.
Franchises with largest market share include: Dairy Queen, Baskin-Robbins, Cold Stone Creamery, Ben & Jerry’s, Kona Ice, Jeremiah’s Italian Ice, and Rita’s Italian Ice.
Per IBISWorld, revenue for the ice cream stores industry sustained an estimated 2.5% decrease in 2020. Now, over the period of time until 2025, the industry “is expected to continue to grow, albeit at a slower rate than the previous five-year period.”
Italian Ice Franchises Showing Promise
A subcategory of the industry, Italian ice franchises appeared to weather the pandemic slightly better than some other ice cream/frozen dessert franchises. The reason? Many Italian ice franchises were already smaller in scale as well as built for walk-up ordering and off site consumption.
As Rita’s Italian Ice CEO Linda Chadwick said in a May 2021 interview, “In a world where convenience, delivery, and off-premise options are king, Rita’s was poised to succeed from the start. This is because the vast majority of Rita’s locations feature walk-up ordering and outdoor spaces to enjoy our frozen treats—that’s how it has always been. Because of this, we were able to quickly adapt to implement social distancing and additional safety measures to keep our guests and teams healthy.”
How the franchise concept is positioned wasn’t lost on people looking to buy a franchise in the turmoil of the year. Rita’s signed 75 new franchise agreements in 2020.
Another Italian ice franchise that’s heating up is Jeremiah’s Italian Ice, which was able to award 100 units during its first year of franchising despite the onset of a pandemic.
Ice Cream Industry Flavor Trends
According to 2020 Innova Market Insights, 64% of U.S. consumers want to discover flavors from other cultures. When it comes to ice cream, these flavors include Mexican-inspired flavors, such as dulce de leche, mango salsa, mango chili and churro; and South Asian beverage flavors including chai, Thai tea, and matcha. Toasted rice (mainly inspired by noo-roong, a traditional Korean snack) has also popped up per KerryDigest.
Some other trending flavors in the ice cream world are flavors inspired by nature, such as floral and botanical notes. Savory flavors, like olive oil ice cream, are also gaining traction.
Dealing with Seasonality
Ice cream franchises certainly reign supreme in the summer. National Ice Cream Month in the United States is celebrated all July long, and National Ice Cream Day is celebrated the third Sunday in July. Both of these national celebrations were signed into existence by President Ronald Reagan in 1984, and ice cream franchises have been celebrating ever since.
For most of the country, ice cream and frozen yogurt are largely seasonal treats for obvious reasons. Who wants ice cream when there’s a foot (or more) of snow on the ground? However, as noted above, many franchises have turned to menu expansion to keep customers coming through the door year-round. As a result, the difference between the peaks and valleys of ice cream demand throughout the year isn’t as large as it once was.
Buying an Ice Cream Franchise
The range of investment between different frozen yogurt franchises can be due to the variations in business systems and execution requirements.
Initial costs associated with opening a franchise include the franchise fee, training expenses (such as travel and living expenses, not the actual training courses), grand opening marketing costs, and more.
A significant cost within the initial investment is the franchise fee. This part of the overall initial investment grants the franchisee the right to use the franchisor’s trademarks and other branding. It also gives the franchisee access to the franchisor’s business system, including training opportunities.
As you set up your ice cream franchise, you can increase their chances for success by performing due diligence research to understand the demographics of the area in relation to the business. In addition, experienced ice cream shop owners recommend remembering why ice cream shops have been a part of Americana for decades: the memories.
As stated in MenuDrive: “Play up the magic of ice cream by hiring warm staff members, building an inviting ice cream space, and putting your all into creating one-of-a-kind flavors that light up your customers’ day.”
Facts About Ice Cream Franchises
The ice cream sector is projected to bring in $8.1bn in 2021, with a 3.6% growth in market size. While milk and dairy items are the principal constituents of ice cream, there’s a range of health-conscious varieties of frozen dessert that attracts those trying to watch the pounds.
These days, you can get vegan and non-dairy ice creams that use plant-based milk (from nuts and seeds) rather than high-fat dairy items.
Historically, ice cream was enjoyed mainly during the summer months. However, ice cream consumption is more evenly distributed throughout the year these days. One step many ice cream franchises have taken to augment the appeal of their ice cream stores is to add sundries such as gourmet coffee and baked goods. Some franchises have expanded their products into supermarket freezer departments to increase their year-round appeal.
July is National Ice Cream Month, with National Ice Cream Day celebrated on the third Sunday of this hot summer month. As if anyone needed an excuse to indulge in their favorite ice cream, they’ve certainly got one now. The National Ice Cream celebrations were signed into existence by President Ronald Reagan in 1984 and have helped ice cream franchises thrive ever since.
The ice cream and frozen dessert franchise segments offer a business model entrenched in fun; your customers come to your store for something to pick them up, cool them down, and excite the tastebuds.
Ice cream franchises appear in a range of locations such as shopping malls, movie theatres, train and bus stations, airports, and even ice cream trucks, bringing the delights of delicious ice cream to the burbs.
Ice cream brings people together – for celebrations or just for enjoying a sweet treat and hanging out in the ice cream parlor. Many ice cream franchises offer the opportunity for community involvement by getting involved in charity fundraisers and hosting pop-ups at family events throughout the year.
Franchising Vs. Independent
Ice cream franchises require a financial investment of varying sizes – check our selection of excellent ice cream franchise opportunities for investments from $50,000.
Of course, most of us don’t have that kind of money in our back pocket (or bank accounts), so you’ll need to apply for startup funding from banks and reputable money lenders.
Independent companies applying for startup collateral often find themselves at a disadvantage compared to franchisees who have the proven business model and financial history of the parent company to bolster their application.
Moneylenders tend to favor franchises because the business is built on verifiable and proven metrics that significantly reduce the risk of lending.
Luckily, moneylenders tend to favor franchise businesses: the business model has already proven itself popular, profitable, and sustainable.
Franchise companies tend to hit the ground running because they come with a ready-made customer base and access to an established supply chain. This means that they tend to recoup their initial investment much quicker than independent companies set up without the support of an established partner.
Almost half of all independent companies go into receivership within the first three years of trading as they struggle to establish themselves among the competition. Recoup of initial investment comes more slowly for indies, meaning that they often fold before they hit critical mass.
Ice cream franchises tend to thrive immediately, relying on the immediate visibility and familiarity of their branding, as well as a menu that local customers already know and adore.
Ice Cream Franchises
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