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The Newsweek story “Ben & Jerry’s Bitter Crunch” was a tough thing for all of us here at Ben & Jerry’s to read. We take great pride in our scoop shops & strive to apply the same progressive values there that we practice across all of our business. Unfortunately, the Newsweek article presented complex issues and boiled them down into a short story that we felt lost perspective on the reality of the situation. As a business led by our values, we thought it was important to provide anyone interested a broader perspective on what’s really going on with our Scoop Shops. But, before we go there, the first thing we want to say is that we want every franchisee to be successful. After all, Ben and Jerry started this whole thing in a neighborhood scoop shop in 1978 and if that wasn’t successful, none of us would be here today. We all hang the same sign over the door and we want us all to be proud of it. We think of this as a family business and each franchisee is part of our family. We know that all of our franchisees have a big stake invested in our business. We truly understand that our franchisees are entrepreneurial business owners with their life savings and life style invested in this business. Each year we launch extensive programs to benefit our franchisees. We can’t specifically say what our upcoming plans for 2008 are because we want to protect our franchisees’ potential successes in 2008 and we don’t want to tip our hands to the competition. We firmly believe we have some exciting programs and flavors rolling out in 2008 that will help our franchisees. We are really excited by some of the strong efforts in 2007, which included great new products and creative menu items, seasonal flavors and beverages. We also had fantastic electronic marketing and public relations programs for our franchisees to apply to their local territory. On top of that we re-launched classic flavors such as the 10th Anniversary Surf ’n Turf Edition of Phish Food, complete with franchise exclusive Phish music download premiums to drive business into scoop shops. Contrary to what the Newsweek article suggested, we have had some important successes this year; along with the initiatives mentioned above, our same store sales have shown increases, and there’s incredible enthusiasm for upcoming campaigns in our scoop shops. Unfortunately though, we do know some folks have not reached the level of success they had hoped for due to the intensely competitive nature of the market right now. Analyzing the situation that leads to someone being happy or unhappy about any business investment is never a simple story. While we want success for every franchisee, we realize that this is not always the reality of the market we compete in. Perhaps the biggest misconception left from reading the Newsweek article is that Ben & Jerry’s somehow misrepresented the earnings potential of a Ben & Jerry’s Scoop Shop. The story suggested that we said a Scoop Shop would bring in $364,892 a year. That number comes from a truckload of information that a prospective Franchisee gets in a bulky document called the Uniform Franchise Offering Circular (UFOC) which contains information that’s intended to help someone figure out whether or not to pursue opening a Ben & Jerry’s scoop shop. In the 2004 UFOC edition the Newsweek article cited, we published earnings information based upon all of the full-franchises that were open for the preceding year and completed a full 12 months of earnings reports. Our intention was to provide helpful information that showed the range and variability of a Ben & Jerry’s Scoop Shop. The information was to be a reference point from which prospective franchisees could start their exploration and due diligence to decide if investing in a Ben & Jerry’s Scoop Shop made sense for them. We included:
“The information set forth in this Item 19 aggregates the gross sales and the key variable costs percentages of individual Scoop Shops. It should not be considered as the actual or probable sales or costs that may be realized by any franchisee.” Also, “Actual results vary from Scoop Shop to Scoop Shop, and we cannot estimate the results of any specific Scoop Shop.” It goes on to say that prospective franchisees should investigate scoop shop locations comparable to the type and location of shop they are considering and interview existing scoop shop owners to see what might be reasonable to expect from such a location. The point of the earnings information and explanatory notes was to provide helpful information for someone to use as a reference point to start researching the business potential of a Ben & Jerry’s Scoop Shop. We never lose sight of the fact that Ben & Jerry’s started in a neighborhood Scoop Shop. Our Scoop Shop system is a core part of our history, a deep part of our company character and a key part of each community we reside in. It’s a family business. Unfortunately, all businesses, including a family business, will face some tough economic challenges. We remain more committed than ever, though, to our goal of creating the strongest possible franchise program, serving the best ice cream in the world, and building a brand that we can all be proud of.  Debra Heintz Director of Retail Operations | |