20 THINGS YOU NEED TO KNOW ABOUT RUNNING AN ICE CREAM SHOP
Ice cream, frozen custard, sherbet, and more!
First, you need to consider what you plan to serve your customers. While ice cream may seem like the logical choice, it isn’t the only choice. You also have the option of selling similar treats like frozen custard, gelato, or even sorbet. While similar, all of these frozen concoctions are distinctly different.
According to the National Ice Cream Retailers Association (NICRA), federal standards refer to ice cream as a frozen treat made up of dairy products like cream and milk, which is then mixed with sugar and other flavorings. When the product contains at least 1.4% in egg yolks, it becomes French ice cream or frozen custard. Sorbet, in comparison, is more like ice and extremely high in sugar and fruit or fruit juice. Sherbet includes between 1-2% milk fat, along with flavorings and sweetener.
What’s in a Label?
Now that you understand the difference between the frozen treats, you’ll need to know about labeling. While you may see the words “reduced fat”, “low-fat” or “nonfat” ice cream thrown out, according to the International Dairy Foods Association (IDFA), there’s a standard that must be met by the U.S. Food and Drug Administration.
“Reduced fat”= at least 25% less total fat
“Light”= at least 33% fewer calories or at least 50% less total fat
“Low-fat”= no more than 3g total fat per ½ cup serving
“Nonfat”= less than 0.5 total fat grams per serving
Know Your Customers
That brings us to our next step. Before you run an ice cream shop, you really need to know your customers, and know what they want. For instance, it may be a hard sell to set up an ice cream shop in a town or neighborhood where most of your potential customers are more into “healthy living”.
In this case, you may want to consider serving low-fat frozen yogurt over ice cream, or at least giving customers a choice. Otherwise, you may not gain enough customers to even break even. It’s probably a good idea to do some research into other similar businesses in your area to see what’s selling and what’s not.
There’s Nothing Plain About Vanilla
Speaking of research, you’ll soon find good ‘ole vanilla ice cream is anything but plain. In fact, according to the International Ice Cream Association, Americans prefer vanilla to anything else. That’s information you need to know if you plan on running an ice cream shop.
Sure, flavors with catchy names are fun to promote and fun to try, but make sure you have a good mix of the traditional with the trendy. According to recent surveys, vanilla remains the most popular flavor in the U.S., followed by chocolate. In other words, don’t discount the old standby flavors when you set up shop.
Mix it up!
Of course, that doesn’t mean you can’t mix things up a little. One of the big reasons why vanilla is so popular is that it mixes well with a variety of toppings. Many ice cream shops give customers the option to add in extras like sprinkles, gummy bears, sauces, and other popular toppings. You’ll need to figure out whether you want to give your customers the option to add in the toppings themselves, or mix the ingredients to-order right at the counter.
Just a little taste
If you want to give your customerswhat they want, you need to be willing to give them just a little taste of what they’re missing. Providing small samples is a great way to get customers to try new concoctions and come back for more.
You can easily do this by bulk purchasing those wood taster spoons. You can also invest in some small biodegradable sample cups from Arctic Supplies. They’re inexpensive and well worth the money you make when your customer does decide on a favorite.
7. Location, location, location!
Next on the list, location, location, location! It’s not just a saying; location really makes a difference in the success or failure of a business. When it comes to an ice cream, you need to consider who your target consumer may be. For instance, if you choose a location right along a boardwalk or a busy tourist location, you’re likely targeting a select group of consumers who may frequent the area depending on the season or in response to certain events in the area. Most likely, you’ll want to find a visible location that brings in a lot of foot traffic. Word of mouth is great, but it will only get you so far in attracting new customers. It won’t do you any good to have a great product if you don’t have any customers coming in to sample it on a regular basis.
How much will it cost?
Along with location, you’ll need to consider cost. The cost of starting up and running an ice cream business is dependent on where you want to be and how much you are willing to spend. According to NICRA statistics, this could include shelling out less than $50,000 or paying millions of dollars. While construction costs alone could set you back between $70-$150 per square foot, again it really depends on where you want your shop to be. You’ll also need to factor in other costs including salaries, insurance, upkeep, possible rental costs and unexpected expenses.
will I need?
Along with the cost of the shop itself, you need to consider the equipment needed to successfully run an ice cream shop. What you need is based on what type of frozen product you plan to sell, plus whether you’ll only have walk up service or plan on including a drive through.
Typically, though you’ll need to budget for either an ice cream dipping cabinet or a soft serve machine. Also, you’ll need to have refrigeration and freezers, plus some sinks, cooking equipment and prep tables. The list gets longer as you increase the items for sale. You will definitely want to check with your local health department, though. It’s likely they already have a specific list of requirements and equipment you’ll have to meet before you can open shop.
Along with the equipment needed to make and store your ice cream, you’ll have to have plenty of additional supplies on hand so that your customers can walk away with what they want. This includes investing in a variety of sizes of cups and spoons. At Artic Supplies you can choose from traditional white paper cups, or mix up the colors and the patterns.
Box it Up!
You’ll also want to think about customers who may want to buy large containers of your ice cream to go. In this case, you’ll want to be sure to have plenty of to go containers to fit your needs. You can find these ranging from 16 ounces up to 64 ounces. It really depends on how much you plan to sell and how much your customers want to buy, especially if they’re planning on a big party or a big family get-together.
And Don’t Forget…
Of course there are other supplies that come with running an ice cream shop you don’t want to overlook, either. It may not sound like a big deal, but you won’t want to forget about investing in plenty of napkins and straws.
While these may not be the biggest items on your list, they are certainly important. Artic Supplies sells napkins in bulk with 4,000 to a case, plus straws come in a variety of colors and styles. No matter which ones you choose, just make sure you have plenty on hand.
Licenses and permits
Back to your local health department, it’s just one place you need to contact before opening an ice cream shop. In addition, you’ll need to get with your state’s sales tax agency to find out about getting a sellers permit, plus get a employer tax ID number from the state you are operating in and a federal tax ID number from the IRS. You may also want to contact your local Small Business Administration for more information about special requirements in regards to running an ice cream shop in your area. There may be other local regulations you need to know about, but all of these agencies are a good place to start.
Should I Franchise?
One way to take some of the big questions off your plate is to franchise instead of starting completely from scratch. Typically when you buy a franchise you’re also buying guidelines and specifications for the business. This will give you specific instructions regarding the layout of your ice cream shop, plus a list of all the supplies and ingredients you need. On the flip side, with a franchise you lose some of the creative control over running your own business. In addition, typically a franchise requires a lot of money upfront. That’s why it is important to do your research and know what exactly you are getting into.
Have a Plan
Before you can secure any funding to help purchase a location, you’ll need to have a good business plan ready to go. Unless you just so happen to have a lot of extra money sitting around, you’ll need a plan to show the bank to help secure funding. This business plan will include where you plan to locate, what your shop will look like and who your target customer will be, among other things.
What About Advertising?
That brings us to how you plan to get customers to try out your shop. Advertising comes in many forms, including radio, TV, social media, the Internet or even billboards, flyers and word of mouth. You’ll want to consider how you plan to advertise and what that will set you back on a monthly basis.
“Sell” What Makes Your Shop Unique
This brings us to knowing not just how to sell ice cream, but how to “sell” customers on making your shop the place they want to go first. You need to start by recognizing what makes your shop and your product so unique. Do you make all of your ice cream homemade, in-house? If so, promote it! If you only use fresh, local ingredients, be sure and make that part of your “sell”. If the thing that makes your shop unique is simply the experience of walking through the doors, you have your answer. Find at least one thing that differentiates your business from the competition, and then capitalize on it.
Years of Competition
It’s important to be unique because you’ll likely have some stiff competition. According to the IDFA, most ice cream manufacturers in the U.S. have been in operation for more than half a century. In addition, most remain family-owned. If you want to compete with companies hanging on to 50 years of history, you have to have a great product.
One thing that’s tough on any ice cream shop is getting through a cold winter. While shops located in warmer climates won’t have as much of a problem, there may still be an issue dealing with smaller crowds during the off-season. To combat the issue, you’ll have to consider thinking about other ideas to bring in the crowds. Maybe run some specials or unique promotions at this time of year to attract more customers. To combat cold weather days, you may want to think about offering up other delicacies and creations that are more appealing when it’s freezing outside. Some ice cream shops add in items like donuts, hot cocoa and other treats when the days are short and the temperatures are low.
National Ice Cream Month
Speaking of the seasons, if you’re running an ice cream shop make sure you don’t miss out on the fun of one particular month. July is officially National Ice Cream Month, and what better way to convince new customers to give you a try than an entire month of fun! From flavors to necessary equipment, from location to supplies, running an ice cream shop takes a lot of pre-planning and a lot of work. However, if you have a handle on these 20 things, you’re already a step ahead of the competition, and that’s a sweet place to be.