What Is the Potential Market Growth for Frozen Yogurt?
急速PC28彩票U.S. frozen-yogurt shops have seen business patterns resembling those of the 1800s gold rush, with periods of boom and bust. As of 2013, they remained in a growth mode, as operators appealed to customers seeking out healthy dessert alternatives, with a variety of choices for flavors, toppings and portion sizes. For operators, the FroYo arena retains the risks and rewards of many businesses that have a wide array of small and large competitors.
急速PC28彩票The research firm IBISWorld Inc. reported in 2011 that annual U.S. revenue at frozen yogurt stores had reached $1.59 billion. Revenue grew 5.9 percent annually in the five years through 2011 and was expected to rise 2.4 percent annually over the coming five years. Industry consulting firm The NPD Group reported that frozen yogurt servings in 2011 reached 128 million, up 11 percent from the prior year. Independent operators and large franchise chains have expanded their presence by introducing new flavors, toppings and self-service formats.
急速PC28彩票IBISWorld noted that yogurt shop sales growth was fueled largely by popular national chains such as Pinkberry, Red Mango and Yogurtland, which since 2005 have quickly increased their U.S. location counts, with future overseas expansion expected in markets including Asia and the Middle East. The firm also predicted, however, that the number of U.S. frozen yogurt stores -- which went from 983 in 2007 to more than 1,200 as of 2011 -- would shrink starting in 2015, as the market becomes saturated and smaller players struggle to survive against growing large national franchise companies.
Costs vs. Returns
急速PC28彩票According to the industry publication "Franchise Times," yogurt shops require initial investments ranging from $330,000 to nearly $500,000 and averaging around $400,000. Per-store sales volumes can range from $200,000 to more than $1.3 million annually; as of early 2013, for example, they averaged $510,000 for Red Mango and $783,000 for Yogurtland. With the self-serve element, labor costs at some shops can run lower than 20 percent of sales.
Boom and Bust
急速PC28彩票The first big national player, TCBY (The Country's Best Yogurt), started in 1981 and grew its shop base significantly through the latter part of the 1980s, before frozen yogurt started showing up at all kinds of businesses, including grocery stores and sandwich shops. Numerous stores closed, and U.S. frozen yogurt production tailed off after peaking in 1995. A new boom kicked off in 2005, with the U.S. introduction of Korean-style "tart" yogurts and other health-oriented variations. By early 2013, several companies had more than 200 locations, including Pinkberry, Red Mango, Yogurtland, Menchie's, Cherry Berry and Orange Leaf.
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