Future for Ice Cream Parlors in 2022
Hello fellow ice cream enthusiasts and happy Monday from the TurnKeyParlor team! Today's topic is a bit more serious than our usual posts; today we will be talking about the future of ice cream shops in 2022.
This year, 2021, has been very difficult for many small business owners. Most are just hanging on by a thread. And many more have already closed their doors. The majority of traffic in ice cream parlors comes from foot traffic, so the effects of the pandemic and shutdowns were felt immediately for many small business owners.
With all that being said, there is a small positive for those who are still around; The opportunity to expand and (eventually) come back stronger than you had before. According to McKinsey’s US Consumer Pulse Survey, 15-20% of all consumers (so basically millions of people) have reported major changes in the shops they visit since the pandemic started, with about half of them sticking with new stores they've tried.
Here's the thing; to actually take advantage of all the potential new customers who may walk into your shop for the first time, you’ll have to make sure that you are meeting the expectations set in our post-covid era. Most importantly, you have to stay in business long enough to reach these new customers!
There are a variety of changes and additions I'd recommend to improve your chances for 2022. Some are pretty simple, like increasing prices or removing products that don’t sell enough or have low margins. Others are a bit more involved, like overhauling your store procedures so that they require less people thus less labor and labor cost.
Not every suggestion involves removing things though; Adding in-store amenities like mobile ordering, curb-side pickup and offering delivery are all important additions & changes that will keep your ice cream store competitive in 2022. I want to go over each suggestion in some more detail:
The suggestions in this section are really more for businesses that are struggling to make it each month; Usually raising prices randomly or reducing employee hours isn't a super popular thing to do, so for most store owners if they don’t have to they won’t. With that being said, take my advice on this: Your customers will be much happier if you're still in business but have to make some changes than to stay the way you are and not make it through 2022 (hey, that rhymed!).
I won’t linger on this one too long, because it's pretty self explanatory. Sometimes you just have to do it. Because we’re getting close to the end of the year, id recommend shop owners put up a sign explaining that next year prices will have to increase: Most customers will understand and will appreciate you being up front with them, and the new year is a great transition date for your customers.
Before moving on, I want to give you a simple example of how adjusting your prices, even just a little bit, can make a huge difference. Lets say a small cup of ice cream at your store costs $3.50. Now, lets say you sell 60 small cups of ice cream a day. This means your small ice cream is bringing in $300 a day, or around $6,300 per month on average.
Now lets raise the price of your small cup by 1$, nothing too crazy. Lets run the same calculations as before; 60 sales a day, at $4.50 a cup, is going to be $360 a day, or around $8,100 per month on average. That is nearly $2,000 more dollars each month for no additional investment. As you can see, small price changes work well, and you can even spread out the increases by raising four separate items by 25 cents instead of one item by dollar, etc. etc.
Removing Waste & Low-Margin Products:
In the same vein as adjusting prices, you may need to adjust what you sell and how much of it you stock. During peak business years, having to throw/give away the last of things that didn’t sell was a pretty normal part of business. But, ice cream shops run on slim margins, and when there isn’t an abundance of customers, that waste becomes a problem.
During hard times, it's better to just be out of that item and offer customers something similar enough to replace it until you get more, than to be overstocked and wasting precious resources that could be used elsewhere to improve the business.
Look at your sales numbers and the time of day you make those sales; if you're not making enough sales at night to cover the cost of (at minimum) your employees and utilities, then its probably smart to cut them. On the other hand, sometimes businesses leave money at the door by being closed when they shouldn't. Study similar businesses in your area to see what times they stay open, and what their traffic is like. You have to remember that ice cream is a product that's usually eaten after going somewhere else (like a movie or a restaurant), so you want to make sure your hours match those around you.
Now, these recommendations are less things you can do to save your business, and more things you’ll have to do to compete in 2022.
Almost everyone has a smart phone these days. The convenience of being able to order and pay on my phone before i get to the store and grab and go is a huge deal during this pandemic. There are many customers right now who will not go to your store unless you have this option, whether its because a family member or they themselves are immunocompromised. Not to mention its just so easy to order from your phone.
Registering your store for the popular mobile delivery apps is another good way to add mobile ordering to your store, while also bringing your store into the limelight by having your store in the app. Be careful though, as these delivery apps are notorious for taking large cuts and actually creating way more problems down the pipeline if your not 1) prepared to take on the influx of orders and 2) if your margins are already too thin, you may not even make a profit using them. I think this is for you to determine. You can always increase your prices on the app to help mitigate that as well.
A quick google search pulled up a article from Small Biz Trends with a guide on how to get your store added to a Delivery Service if your interested. Read HERE!
Usually done in conjunction with mobile ordering, curbside pick-up has really become commonplace. It’s a way to keep traffic at a minimum and allows those who’d rather not risk getting sick a way to still enjoy your store. You can do curbside pickup without a mobile app too! Curbside pickup is something you can implement quickly without any real technical support; all you need is some designated parking spots and a phone number (and maybe a sign for outside) and you can start offering curbside pickup as soon as tomorrow!
Outside / Social Distance Seating
As 2022 rolls in, more and more people are going to get vaccinated. A byproduct of that is that more people will be willing to come in, sit down, and hang out. Offering customers a safe space to do that is extremely important during the post-covid era. The last thing you want is to be responsible for a breakout because you were sitting customers too close. If you have an outside space, try making that space as accessible (and spread out!) as possible so that both you and customers will safe and satisfied.
I hope this article is received as I intended; I don't want to discourage any ice cream business owners. In fact, I think now more than ever there is so much opportunity within this industry. The market was supersaturated, and before 2021 Ice cream parlors were already struggling. 2022 will be the big reset on all of that, and I truly believe the ice cream parlors that make it through 2022 will reap the rewards of an economy that's recovering quickly, as the pandemic slows in the US.
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