Are you interested in starting your own ice cream shop? The process of opening an ice cream shop is exciting, but it also comes with a lot of risks. Avoiding risks means avoiding the mistakes that many entrepreneurs make to increase your odds of succeeding. The biggest mistake that many startup entrepreneurs is not having enough capital. It is important for startup entrepreneurs to know why a cooperative is the best choice when it comes to capital and opening an ice cream shop.
Don’t make the mistake of not having enough capital
The biggest mistake that start-up entrepreneurs make is not starting with enough capital. Capital is the amount of money or other assets that a person or organization contributes toward a specific purpose, including starting an ice cream shop. The requirements for starting a new ice cream shop can range from acquiring inventory to hiring a marketing team. Many entrepreneurs assume that they can start small financially and then spend more money as they make more. However, minimizing too much on capital will compromise the success of your ice cream shop.
If you would like to open a premium ice cream shop, one of the best ways to avoid the mistake of not having enough capital is joining a cooperative. Look for an ice cream shop cooperative that has a membership buy-in, like KaleidoScoops. When you buy a share or a membership, you are paying for a share in the cooperative organization.
Understanding franchises and cooperatives
Most franchises charge franchising, advertising, and royalty fees in the range of $15,000 to $40,000. By comparison, a typical cooperative start-up cost is thirty to sixty percent of these terms for an upfront cash payment. With a franchise, you’ll be responsible for an advertising fee of one and three percent of your total earnings. The royalty fee for a franchise is four and seven percent of your total earnings. The cooperative business model does not have any of these fees. You’ll have a one time cooperative membership fee and yearly cooperative dues, which amount to a fraction of the franchise fees.
The franchise structure limits the way that you can run your business. You won’t have the option to introduce new products or alter the signage or advertising color scheme. You’ll also be stuck running national promotions and other specials that may not be of interest to your local target audience.
Many franchise agreements require their ice cream shop owners to buy all of their supplies and ingredients directly from the franchise. Buying from these franchises is required, even when there are cheaper options available. With a cooperative business model, you can maximize the economies of scale that come from the group’s buying power to get the best prices available.
By becoming a member of a cooperative, you also get the benefits of having certain industry standards that help you maintain a reputable shop. You can tailor your ice cream shop to the local customer base and add unique touches that reflect your own personality. For example, if you are passionate about a local sports team, you can decorate your ice cream shop with team items during the season. With a cooperative, you’ll never have a corporate bureaucracy dictating how your ice cream shop will be managed. This freedom allows you to make choices that align with the needs and preferences of your customers.
KaleidoScoops is proud to have cooperative members that are dedicated to their local neighborhoods. It is important to us that our ice cream shop owners stay connected to local happenings. For example, if a cooperative ice cream shop member wants to support a local school or partner with a local business, we encourage them to do so.
For the past fifteen years, KaleidoScoops has been giving entrepreneurs all around the country the opportunity to open their own ice cream shops. You get the wide range of benefits that come with a franchise, while maintaining the flexibility and control that you desire. You can run your ice cream shop the way that you see fit, with access to valuable knowledge from experienced fellow cooperative members. If you would like more information about KaleidoScoops premium ice cream shops and our products, call us today at (877) 426-8488. Get The Scoop on becoming part of the KaleidoScoops cooperative. You can also Contact Us by email by filling out our contact form.