Cold Stone Creamery Franchise: 50%+ Failure Rate in Colorado Springs

by sean on May 3rd, 2008

Upcoming food franchise opportunities we’re exploring: 5 & Diner,

Booster Juice, Carvel, Chocolography Food Imaging System, Currito Burritos Without Borders, Maui Wowi

(FranchisePick.Com)

Spring may be warming up for some, but 3 out of the 5 Cold Stone Creamery franchises have gone cold and stiff in the past year.

Melissa Cassutt of the Colorado Springs Gazette reports:

The latest, at 2130 Southgate Road, was seized after owner Pittman Investments LLC, failed to pay $23,985 in state sales tax, according to a sign posted on the door. The assets of the store - including a industrial-size ice cream machine and three waffle cone makers - will be sold in a public auction Tuesday.
The city also has a tax lien against Pittman Investments. Company owner Ralph S. Pittman Jr. could not be reached for comment.

Cold Stone Creamery franchises at 218 N. Tejon St. and 765 N. Academy, Colorado Springs, also closed within the last year. In May 2007 Michelle Chocolatiers & Ice Cream closed, and a Maggie Moo’s Ice Cream and Treatery franchise closed in November 2006.

According to Cassutt, approximately 16 percent of all Cold Stone franchises are for sale. So you can have your pick of 228 out of 1,400 franchises open.

Why are Cold Stone Creamery franchises failing?

Food and beverage industry publication The Ice Cream Reporter, blames the high cost of operating a Cold Stone Creamery franchise.

According to the article, former CSC franchisee Bruce Hodgkins is quoted as saying that “location and corporate policy played into his decision to relinquish the franchise back to corporate in 2005, after three years of business.”
According to Hodgkins, Cold Stone allowed the Tejon franchisee to open too close to his store, and they forced him to remodel shortly after opening. He also complained that Cold Stone didn’t let him to do his own advertising, and forced him to honor $40,000 worth of corporate coupons in his last year of business.

According to Cold Stone franchisee Hodgkins, “You just don’t make any money the way it’s set up.”

WHAT DO YOU THINK? SHARE A COMMENT BELOW.

__________________________