Should I Invest in a Yogurtland Franchise?

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I was in Las Vegas the week after Memorial Day last year, vacationing with family from the Philippines.  Of course, being the typical Filipino tourists, shopping was at the top of our agenda.  We visited all the major shopping centers on the strip.  After we were done with the usual favorites, we decided to check out the outdoor shopping mall called Town Square, just a few minutes cab ride from Mandalay Bay.

It was a nice, spacious shopping center, with a few retailers that weren’t on the strip, like Borders Books.  It was also much quieter than any of the other malls in Vegas (we were there on a weekday afternoon).  But one store stood out because it had a line snaking out its door.  It was Yogurtland.  We knew we had to try it.

I’m so glad we did.  The variety of interesting flavors was just dizzying.  They had Taro, Toasted Coconut, Red Velvet Cupcake Batter, Pecans & Pralines, Peanut Butter, Pumpkin Pie and so much more.  There was also an amazing array of toppings, but I decided to skip those because I wanted to savor the actual flavors of the yogurt.  I couldn’t decide which flavors to try, so I ended up with a pretty delicious mess.  But I was in heaven with every bite.

I enjoyed the experience so much that I returned to Town Square by myself to have one last taste of Yogurtland before flying back to Vancouver.  This time, I focused on fewer flavors, and enjoyed the experience even more.

I’m surprised that the self-service yogurt trend hasn’t hit Vancouver hard yet.  Considering that the locals here live a very healthy lifestyle, I would think that they’d appreciate a healthier alternative to Dairy Queen.

We have a couple of Yogen Fruz, but they don’t offer the self-service option and their yogurt flavors are limited to just a few.  There’s also a new BC-based chain called Qoola, but they don’t have any locations near me and I wasn’t as excited about the flavors they offered when I visited.

So should I invest in a Yogurtland franchise and open a location in downtown Vancouver?  Here are my thoughts on the pros and cons of this franchise opportunity:

The Pros:

1.  Excellent Product - I think they’ve succeeded in making a healthier dessert option like yogurt extremely accessible and appealing to the general public.  The self-service format makes it really fun for entire families, especially those with young kids and teenagers, as evidenced by the crowd in Town Square Las Vegas that day in May last year.

2.  Simple to Run, Streamlined Operations – The focused menu makes it easier to run compared to other food service operations with a more extensive menu.  The menu consists of only 2 categories:  yogurt and toppings.  I’m confident that I will find the food preparation aspect of this franchise manageable.

3.  Small Footprint – The typical location size is 1,000 to 1,500 square feet (I personally favor a smaller location to reduce overhead costs).   Most retail franchise concepts typically require more square footage, so the fact that this concept can fit in a compact space is definitely appealing.

The Cons:

1.   Seasonal Product? – I’d personally eat at Yogurtland any time of the year — rain, snow, or shine.  I have a sweet tooth and I’d like to feel less guilty when indulging in dessert.  I can see myself managing my sweet cravings by visiting this store a few times a week, especially since the self-service option gives me the power to control portion size.

But, unfortunately, I’ve observed that the ice cream and gelato shops in my area are pretty dead during the winter months (and Vancouver winters are not even harsh!).  This worries me.

I also noticed that most of the current locations of Yogurtland are in Southern California, Texas, and Florida — regions of the United States known for year-long warm weather.  I’m sure this is not a coincidence.  And, looking back on my experience, I visited Yogurtland in Vegas at the start of the summer — so of course, it was very busy!

On the positive side, however, this business model could still work in a city with a more seasonal climate since the retail space required is so small.  By keeping the fixed overhead costs low, a savvy franchisee can ride out the slow winter months, and really try to make up for it (and more!) during the spring, summer, and early fall.

2.   Is the Product Differentiated Enough? – I personally think the flavors offered at Yogurtland are unique and worth a special trip.  But would most people settle for a competitor’s offerings if the location was more convenient to them? Perhaps.

Another fear is if the trend really takes off in my city and a competitor opens a franchise store nearby.  Will Yogurtland’s offerings be distinctive enough to ward off the competition? I don’t know for sure.

I’m curious to see if the franchise company can continue to innovate with its menu to stay one step ahead of the competition.  I’m wondering if a product extension in a related category (like crepes or waffles) would make sense for this business in the future.  I think their current offerings are simply the most creative, so I’d definitely keep an eye on them for future developments.

In summary, the Yogurtland franchise opportunity appeals to me because I love the product, it’s easy to run, and the overhead costs are low.  But I really have to do more research on my local area to determine if downtown Vancouver can support a store like this.

What do you like and don’t like about the Yogurtland franchise opportunity?  Are you a current franchisee of Yogurtland?  What are your thoughts? Do you work for the Yogurtland franchise organization?  Do you want to add anything to the conversation?

Tagged as: Qoola, Yogen Fruz, Yogurtland