FDD Talk 2016: The Andy’s Frozen Custard Franchise Opportunity (Financial Performance Analysis, Estimated Costs, and Other Important Stuff You Need to Know)

In this FDD Talk 2016 post, you’ll learn the following:

• Section I – Background information on the Andy’s Frozen Custard franchise opportunity, including relevant news updates

• Section II – Estimated initial investment for an Andy’s Frozen Custard franchise, based on Item 7 of the company’s 2016 FDD

• Section III – Presentation and analysis of Andy’s Frozen Custard’s financial performance representations, based on Item 19 of the company’s 2016 FDD, including information on the:

• 2015 actual, average, and median gross sales for the 8 franchised and 14 company-owned Andy’s Frozen Custard Stores that operated during Andy’s entire 2015 fiscal year period from January 1, 2015 until December 31, 2015

• 2015 actual, average, and median gross sales, cost of goods sold, and gross profit for the 14 company-owned Andy’s Frozen Custard Stores that operated during Andy’s entire 2015 fiscal year period from January 1, 2015 until December 31, 2015

Section I – Background Information

It was back in 1986 when John and Carol Kuntz decided to create a new frozen custard brand in Osage Beach, MO. They decided to name it after their son, Andy, and started teaching themselves the business from the ground up.

Their passion in creating the highest-quality treat possible quickly made the new business a legend on the lake. They established a second location in Springfield, MO, which is where Andy and his wife eventually started learning the business as well. Andy is now the president of the company.

Customers can place their orders at a walk-up window or take advantage of drive-thru service at each location. The number of locations is slowly climbing, with the company website listing 36 locations in 7 states (Missouri, Arkansas, Oklahoma, Colorado, Illinois, Texas, and North Carolina) along with another 15 labeled as coming soon, including new states such as Arizona, Kansas, South Carolina, and Tennessee.

Celebrating its 30th anniversary this year, here’s how Andy’s Frozen Custard keeps customers coming back for more in the competitive frozen dessert franchise segment:

Boiling It Down to Three Simple Rules

Keeping things simple is the rule of thumb at Andy’s, which is why their vision consists of only three simple rules: Take care of your customers, take care of your employees, and take care of your product. It’s simple, but it’s also effective! And it includes making sure employees are paid a fair wage and given the training and tools they need to be successful.

A Passion for Quality

Taking care of their product means an uncompromising commitment to quality. The frozen custard recipe at Andy’s is as simple as cream, eggs, sugar, and vanilla extract. Chocolate and vanilla serve as the base flavors, but from there things get very creative when they start mixing in real fruit (no syrups or sauces) and other delectable toppings. And of course the custard is made fresh each and every day.

A Creative Menu

You can have your frozen custard in a cone if you’re not feeling very daring. But Andy’s offers all kinds of interesting treats, including concretes and jackhammers by mixing the custard with various items to create such offerings as the Snowmonster Concrete, the James Brownie Funky Jackhammer, the Jitterbug Concrete, and the Rico Suave Jackhammer.

Customers can also enjoy their frozen custard in sundaes, splits, malts, shakes, and floats.

Taking Care of Customers

The dessert market continues to be huge in the U.S., with 99% of people indulging on a regular basis. Andy’s treats people right by offering their menu year-round, unlike many frozen custard shops, and offers heated patios when the temperatures dip down low.

Customers who bring their favorite canine companion with them get a free puppy cone along with their order. If customers have food allergies, they just need to mention it to the staff and they will bend over backwards to accommodate them.

The NASCAR Connection

Andy’s recently was the title sponsor of #8 NASCAR Camping World Truck Series’ points leader John Hunter Nemechek at a Kansas Speedway race. This could be the beginning of a very “fruitful” relationship.

Section II – Estimated Costs

• Please click here for detailed estimates of Andy’s Frozen Custard franchise costs, based on Item 7 of the company’s 2016 FDD (updated).

Section III – Financial Performance Representations (Item 19, 2016 FDD) and Analysis