(Ambrosio’s note: I received an email earlier today from a reader asking me what I thought of Aspen Leaf Yogurt. I’d never heard of the company before, so I promised him that I would look into it. I was pleasantly surprised to discover a frozen yogurt brand with something new to offer.
Rocky Mountain Chocolate Factory is very popular in Vancouver. Their downtown flagship on Robston Street is practically a tourist destination. The contemporary interiors and exceptional merchandising make the store a true showcase for their tempting treats — from fudge, caramel apples, cookies, ice cream by the scoop, and chocolates of all kinds.
As for Aspen Leaf, I generally prefer to go with the number 1 or 2 brand in a category, but this late entrant may have a competitive advantage with their exclusive toppings from Rocky Mountain (versus store bought candy used by almost all of their competitors). In my opinion, they should have incorporated the Rocky Mountain name in their frozen yogurt brand to take full advantage of the synergies between the two. Rocky Mountain’s Aspen Leaf Yogurt, perhaps? A bit clunky, I admit, but the association has to be obvious.
I eagerly await the next phase in the battle for frozen yogurt supremacy, where Aspen Leaf may very well assert itself as a formidable competitor. Please check back for more on Aspen Leaf as I reach out to the company to gather more exclusive information.)
10 Things I Learned About Aspean Leaf Yogurt
1. Headquartered in Durango, Colorado, Rocky Mountain Chocolate Factory, Inc., franchises, operates and/or co-brands approximately 358 Rocky Mountain Chocolate Factory gourmet chocolate/confection stores in 36 states, Canada and the United Arab Emirates.
Earlier this year, the Company entered the self-serve frozen yogurt market with its Aspen Leaf Yogurt concept.
2. The company’s first store opened in San Antonio, Texas, and additional company-operated stores soon followed in Boise, Idaho; Farmington, New Mexico; and Greeley, Colorado.
The first franchised Aspen Leaf store opened in Boulder, Colorado, in accordance with a territorial franchise agreement that calls for the opening of five stores in Boulder County, Colorado over a 24-month period.
As of February 28, 2011, Aspean Leaf projects opening 11 corporate-owned stores and 5 franchised locations this fiscal year (as disclosed in their 2011 FDD).
3. A standard Aspen Leaf unit is typically located in a neighborhood shopping center anchored by a grocery store, or a tourist area that has a high level of pedestrian traffic. Typical stand-alone units occupy 1,800 to 2,200 square feet, with seating for 12 to 24 people, usually in leased space.
There is also the option to operate kiosks, located within larger retail centers, that offer a limited selection of Aspen Leaf products.
Aspen Leaf units have an inviting, contemporary look and offer free Wifi Internet connection to encourage customers to sit down while they enjoy their frozen yogurt.
Toppings include fresh fruits, nuts, cereal and Rocky Mountain Chocolate Factory premium candy toppings.
A typical standalone unit offers up to 16 varieties of frozen yogurt at one time, with as many as 50 flavors offered each year, including seasonal flavors offered at different times throughout the year.
5. According to Edward L. Dudley, Senior Vice President of Sales and Marketing at Rocky Mountain Chocolate Factory, Inc., “Our Aspen Leaf concept is based on giving people everything they need to create their own personalized, amazing frozen yogurt experience. Ours are the only frozen yogurt stores to feature toppings made from Rocky Mountain Chocolate Factory chocolates which, along with other topping selections, allow customers to get highly creative in the development of their own recipes.”
6. Bryan Merryman, the Company’s Chief Operating Officer, adds, “Our product development staff worked tirelessly to find a yogurt product that tastes great, while delivering a higher level of probiotic benefits to customers than is available at many competing stores. Customers can also choose from a limited selection of our branded chocolate products that can be purchased separate from the yogurt menu. We believe that the availability of toppings and other products made with premium Rocky Mountain Chocolate Factory chocolates, combined with our reputation for outstanding customer service, will present the Company and its franchisees with a unique model in the rapidly-growing self-serve yogurt market.”
7. The management team at Rocky Mountain believes that their more than 29 years of franchising experience and support, high-quality reputation in confection manufacturing, proprietary training and store operating methods, extensive relationships with developers and real estate companies, and their store base of over 358 Rocky Mountain Chocolate Factory stores, will allow them to establish Aspen Leaf Yogurt as a premium retail brand within a relatively short period of time.
8. In their most recent quarterly earnings report released October 11, 2011 (Rocky Mountian is a NASDAQ-listed public company), Bryan Merryman provides some clues on the year-to-date performance of their Aspen Leaf units:
“While a soft economy and difficult credit environment continues to challenge our Rocky Mountain Chocolate Factory franchise system, we are pleased to report a 14.3 percent increase in revenues for our second quarter, primarily reflecting retail sales contributions from the growing number of Aspen Leaf Yogurt (‘ALY’) stores operated by the Company and franchisees.
We opened four Company-owned ALY stores in the first six months and have signed leases for five additional stores that will begin opening in November of this year. Two franchised ALY stores also opened during the second quarter and another came on line in September. At the present time, eight ALY stores are operating in four states, and we expect to be operating 13 ALY stores by the end of the current fiscal year.
Although none of the ALY stores has been open long enough for us to evaluate their full-year operating metrics, we have been pleased to date with the sales generated by the Company-owned and franchised ALY stores. We believe our entry into the frozen self-serve yogurt market has the potential to significantly enhance shareholder value in coming years, as this new initiative complements our chocolate store business, leverages our three decades of experience in franchising and provides diversification of our revenue base.”
9. But Bryan adds a note of caution: “A scarcity of available credit for small businesses in the current economic environment continues to make it very difficult for existing and prospective Rocky Mountain Chocolate Factory and Aspen Leaf Yogurt franchisees to finance new store openings.”
10. The estimated initial investment to open a stand-alone Aspen Leaf Yogurt store ranges from $415,250 to $625,400, which includes the initial franchise fee of $29,500. The ongoing monthly royalty is 6% of gross sales, and the monthly marketing and promotion fee is 2% of gross sales.