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120 • FOODSERVICE EQUIPMENT & SUPPLIES • MAY 2015 There also has been a shift in culture. Rather than focusing solely on growth by acquisition, the company now centers on franchisee support and market- ing efforts. "Administrative and overhead consolidations will enable us to increase our proft- ability as a franchisor, substan- tially, since the restructuring," Stribling says. Now more than 250 frozen yogurt shop locations reside be- neath the U-Swirl umbrella, and the chain expects this number to grow signifcantly during the next year. With U-Swirl experi- encing increases in same-store sale comps for the frst time in the last year, it appears the new business model is working. "So many chains made the mistake of building out stores and didn't pay atten- tion to real estate," Stribling says. "We're seeing that well-run stores in good loca- tions, where there was thought behind the site selection, are succeeding." At press time, U-Swirl was planning the acquisition of three more chains as well as looking to purchase other strug- gling frozen yogurt franchise companies. So far, the big- gest challenge with this business model has been coming to agreement on what each brand is worth. "We've put together a program that offers both sides a fair deal," Stribling says. "It's a shared-risk program that allows us to be more gener- ous with our compensation, but protects our interests so we can add as many locations as possible." Looking at each market individually and assessing the proftability of long-standing dessert operations provides much insight on the number of yogurt shops that can be sup- ported in the area. "It's easy to look at markets and see how many yogurt shops can be supported," Stribling says. With the growth of self-serve frozen yogurt concepts, there also is more opportunity for equipment innovations unique to this segment. "In terms of equipment, there has been very limited innovation, so now is the time for manu- facturers to consider unit designs specifcally geared for self-serve yogurt," Stribling says. "So far, the most signifcant development I have seen has been the creation of devices by third-party companies that simplify cleaning and mainte- nance of the equipment." The fact that yogurt is highly desired by the public and has been a huge part of the frozen dessert industry for decades is a defnite plus for U-Swirl. "We believe the yogurt business is very strong, since it does better than just about any competing ice cream business," Stribling says. "If we continue to follow our model of growth by acquisitions and acquire other brands that are struggling, we can support franchisees in the way they need to be supported." e&s; segment spotlight ● ● The frozen yogurt stores industry grew at a rapid pace between 2009 and 2014. Driven by consumers' increasing health consciousness and the emergence of tart-favored frozen yogurt, it is expected that health concerns and consumption patterns will continue to drive industry growth through 2019. ● ● In 2014, frozen yogurt revenue totaled $1.8 billion, with $113.9 million in profts. By 2019, revenues are expected to increase to $2.1 billion. ● ● Annual sales growth in the frozen yogurt segment between 2009 and 2014 was almost 23 percent, but this is expected to decrease to 3.4 percent between 2014 and 2019. ● ● In 2009, there were approximately 1,022 frozen yogurt shop locations in the U.S. This fgure was estimated at 2,910 in 2014. ● ● The number of frozen yogurt stores is expected to increase at an average annual rate of 5.5 percent to 3,800 in 2019. ● ● Self-serve operations comprised 69 percent of frozen yogurt stores in 2014. ● ● In terms of demographics, consumers ages 18 to 35 are the largest consumers of frozen yogurt — at almost 42 percent — followed by those ages 36 to 50 (nearly 30 percent). Source: IBISWorld FROZEN YOGURT SHOP FACTS Right: By consolidat- ing its operations and purchasing, U-Swirl has been able to increase revenues for its increasing number of brands. Bottom Right: Rocky Mountain Chocolate Co. and Yogurtini have successfully co- branded locations to increase the exposure of both brands.