In the market for cool customers

Nation's Business, Dec, 1997

We plan to open a wholesale-retail ice cream store. Where can we go for more information, and how can we find financing? S.S., Avondale Estates, Ga.

The National Soft Service and Fast Food Association in Waynesboro, Pa., represents several hundred independently owned ice cream operations nationwide. The organization's annual meeting offers sessions devoted to helping start-up ice cream businesses and lining up the necessary financing; call 1-800-535-7748 for more information.

Chauncey Blumbaugh, executive director of the association, says the health-food craze that pumped up sales of frozen yogurt in the early 1990s appears to have leveled off. Consumption of rich, calorie-soaked "premium" types of ice cream is on the rise, he says. Sales data also suggest that chocolate has overtaken strawberry as the nation's No. 2 flavor; vanilla remains king of the cone. (The International Dairy Foods Association, based in Washington, D.C., reports that U.S. ice cream sales, growing every year, hit $10.7 billion in 1995.)

The three key issues in the ice cream business, Blumbaugh says, are location, menu, and labor availability. The location should be a busy place but not one with so much traffic that drive-by customers can't stop. The menu should offer other foods to help carry the business through the winter, when ice cream sales typically fall off. And there should be a sufficient labor pool; young and retired workers are most common in ice cream retailing and can be drawn away from fast-food competitors with wages a bit above minimum.

"Help is hard to get," Blumbaugh says. "A small business cannot afford to pay some of the wages and benefits that bigger companies do."

Blumbaugh's organization plans to change its name in January to the National Frozen Dessert and Fast Food Association to reflect its membership's growing interest in "hard" ice cream, frozen yogurt, and other such desserts. Membership fees start at $75 a year.

Other sources of information for ice cream start-ups include the Philadelphia-based International Association of Ice Cream Vendors, which focuses on safety issues (215-564-3484; membership is $300 a year), and the National Restaurant Association in Washington (202-331-5900; membership fees vary).