For the first time in U.S., Goodberrys plans to sell franchises
January 28, 2011
By: Amanda Jones Hoyle
Triangle Business Journal
RALEIGH – The makers of Goodberry’s frozen custard, who serve their ice cream-like concoction at nine Triangle shops, say they are ready to take the brand on the road.
Goodberry’s has filed incorporation papers with the state to begin offering the brand’s first franchising opportunities to area developers and franchisee operators.
Company executives say they plan to begin meeting with prospective franchisees by April after they have finalized details for their disclosure documents and cost estimates. Goodberry’s, which has been a fixture on the Triangle retail scene, now sells about $5 million of its products on an annual basis, according to some estimates. It employs about 100 people during the winter and about 250 workers during the summertime.
Heretofore, Goodberry’s Creamery Inc. has owned all of its ice cream shop locations, which have been popping up around Wake and Durham counties since founder Harry Brathwaite opened the first Goodberry’s shop in north Raleigh in 1988.
Goodberry’s marketing director Henry Brathwaite, who also doubles as general counsel for the company, would not say how many Goodberry’s franchise locations the company is targeting to open in the next year or so, but franchise experts say Goodberry’s would be wise to grow concentrically from its geographic core in the Triangle.
“It’s like checkers. You move one step at a time so your pieces are not sacrificed,” says Craig Tractenberg, a franchise lawyer with the Nixon Peabody law firm in New York. “As they grow, they will have to adjust to local tastes, and they haven’t been challenged in that way, yet.”
But Goodberry’s is not a complete novice to expansion outside its area code. In 1999, a licensee in Australia opened the first and only Goodberry’s store beyond U.S. borders.
“The experience of servicing a licensee on the other side of the planet has been very valuable to us,” Henry Brathwaite says. “Beyond the logistical component of keeping a location that’s 10,000 miles away supplied, it’s given us a lot of insight on the type of individual that’s a good fit for our company and visa versa.”
Brathwaite says that the company’s leadership has been mulling over creation of a franchise system for several years. Goodberry’s already manufactures its own proprietary frozen custard machines, and it recently set up a commissary company to supply ingredients and equipment to new operators. Plus, the demand seems to already be there.
In the summertime, Brathwaite says, he would field two or three calls a week from investors interested in opening a Goodberry’s franchise. “We feel we have reached the point where we have the system and personnel to commit to a franchise program,” he says.
Goodberry’s has also hired Raleigh franchise lawyer Ritchie Taylor of the Manning Fulton law firm to assist in the effort. Taylor has worked with other local retailers, like Fleet Feet of Chapel Hill, East Coast Wings & Grill of Winston-Salem and Brixx Pizza of Charlotte to expand their concepts through franchising. “(Goodberry’s) has some advantages playing for them,” Taylor says. “They have a very well-developed brand and a loyal customer base. These are things that a franchisee can take advantage of.”
Nationally, frozen yogurt, ice cream and custard brand companies have been growing exponentially through franchise models.
Texas-based Red Mango, which debuted its first U.S. store in 2007, recently opened its 100th location and plans to open 100 more units in 2011. TCBY has signed a development agreement to open 200 locations of its new self-serve model in Texas.
Cold Stone Creamery and Marble Slab Creamery are the competitors most comparible to Goodberry’s in the Triangle. Scottsdale, Ariz.-based Cold Stone, which was started in 1988, opened its first franchise in 1997.
It has since grown to more than 1,500 locations in 16 countries. Marble Slab started in 1983 and has grown to hundreds of locations in 35 states and around the world.
Brathwaite is optimistic, however, that Goodberry’s slower growth model will benefit its business partners in the end.
“The business of franchising, unfortunately, is fraught with too many franchisors whose products or systems aren’t prepared for the long term,” he says.
“We’ve never wanted to be one of those companies. We certainly also feel that our product is prepared for the long term – unlike a number of food and, in particular, dessert franchises being offered today, frozen custard is not faddish or gimmicky – it’s been around and popular for a long time.”
Reporter e-mail: aljones@bizjournals.com.
