Ice cream shops are a favorite with buyers of small businesses, but many times don't know what to look for when seeking a purchase of a shop. Joe Ranieri and other intermediaries and advisors share their experience and expertise to potential ice cream shop owners. Explore these tips to learn more.
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According to the IDFA (International Dairy Foods Association), "The average American consumes approximately 23 pounds of ice cream and related frozen desserts per year." The IDFA also states that the ice cream industry on average has a $13.1 billion impact on the US economy. Americans love their ice cream, and to make things better, legislation is under heavy consideration to make daylight savings time permanent year around, which would be great for the industry, because in the winter months sales drop off, and longer sunlight days would cure that problem dramatically. Many buyers are attracted to ice cream businesses, because of the easy menu, through simple training, and the fact they can be run by a small number of staff, many times without the owner being present.
Here are some tips:
1. Franchise or Independent - Cold Stone Creamery and Baskin Robbins franchises are extremely well-established brands, but many independent locations are wildly successful, and offer the owner the opportunity to sell other items, such as boba drinks, organic, etc., that may be attractive to a specific clientele. A more flexible menu will help the operator be able to survive the colder months when sales tend to drop off.
2. Location - An important aspect to remember is that ice cream is often an impulse purchase, and so a buyer should really do their homework. Franchises work well in major shopping centers, surrounded by yoga studios, major supermarket chains, cleaners, etc., and independents work well in locations, such as boardwalks, and other areas with heavy foot traffic, that might be more attractive to have speciality items to sell, such as gelato, etc.
3. Creating a smart menu - Hundreds of ice cream businesses, whether kiosk, truck, or brick and mortar, may exist in one city alone, and so if one does go the independent route, it's vital to have a menu that not only encompasses the classics (vanilla, chocolate, cookies and cream, etc.), but also specialty items, and health-conscious items, such as low and or sugar free. Keep the menu simple and clean, because as stated before, ice cream is most common an impulse purchase, and the longer someone is deciding what to get, the longer it gives them to talk themselves out of buying all together.
4. Inspect equipment - Commercial frozen yogurt machines can be expensive, along with walk-in freezers, so a buyer should always do their due diligence and have them thoroughly inspected upon business purchase.
Upon closing, I've found many ice cream businesses to be highly profitable, if they are in heavy foot traffic locations, and areas that receive higher traffic during the summer months, if possible, because many ice cream shops make a large portion of their profits in the summer, especially beach locations.
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