Midwestern treat heads east Franchise: A Maryland businessman scooped up ice cream company MaggieMoo's, bringing its headquarters here from Kansas City, Mo. He hopes to dish out his wares nationwide.


January 05, 1998|By Stephen Kiehl | Stephen Kiehl,CONTRIBUTING WRITER

The puns are unavoidable. But don't have a cow, because MaggieMoo's is mooving in. And it's planning to milk Maryland for all it's worth.

A Maryland businessman bought the super-premium ice cream company, moved its headquarters from Kansas City, Mo., to Columbia and is planning to rapidly expand in the Baltimore-Washington market and nationwide.

Richard J. Sharoff, former president of Vie de France and the Maryland developer and franchisee for Boston Market, is set to take MaggieMoo's from a popular Midwesteren ice cream shop to a national star, capitalizing on the surge in consumption of high-quality ice cream.

It's a bull market for ice cream. Sales of premium and super-premium ice cream were up 28 percent in the first half of 1997, according to the International Ice Cream Association in Washington. Meanwhile, sales of frozen yogurt were down 23 percent, indicating that the yogurt craze has seen its best days.

So now is the perfect time to introduce MaggieMoo's to the mid-Atlantic region, Sharoff said. A MaggieMoo's shop opened in Springfield, Va., in July, and Sharoff hopes to open as many as 30 shops in this area over the next five years. Over the same time, he plans to open between 200 and 500 shops nationwide.

There are 16 MaggieMoo's shops, most of them in Kansas and Missouri. The company is expecting revenue this year of $4 million.

James Barrett, an analyst with Josephthal & Co. in New York who follows the ice cream industry, said MaggieMoo's has a good shot at successful expansion.

"It would appear as if they're reasonably well-positioned," Barrett said. But, he added, "It seems intuitive that super-premium ice creams will not continue to see double-digit growth."

Sharoff said that once people taste MaggieMoo's, they'll be hooked.

"There's nobody who can make better ice cream than we do," he said. "The quality of the ice cream is unbelievable, like nothing you've ever had before." In reader's choice awards in Midwestern newspapers and magazines, MaggieMoo's is frequently voted the best, Sharoff added.

The primary reason is that MaggieMoo's ice cream is made fresh daily at every shop. So the ice cream is never more than a few days old, unlike ice cream at other shops, where it's trucked in from a plant and can be several months old, Sharoff said.

"It really makes a difference in quality," he said. During shipping, ice cream suffers from "distribution stress" and goes through freeze/thaw processes. Because MaggieMoo's is not shipped, it has a superior taste, Sharoff explained.

Also, MaggieMoo's offers 40 mix-ins, such as Reese's Pieces, strawberries and M&M's, that are rolled into the ice cream on a cold granite slab. That knocks air out of the cream to create a rich, dense product.

Sharoff scooped up the MaggieMoo's chain in November 1996, a time when the franchisees were unhappy with the support they were receiving from the owner, Juel Tillery, who founded the chain in 1989. Upset with the poor marketing and support, several franchisees had stopped paying their 5 percent royalty fees. And one group of franchisees was threatening to file a lawsuit against Tillery.

One of Sharoff's first moves was to tell franchisees they didn't have to pay royalties from November 1996 through March of this year. He hired cartoonist Charlie Podrebarac to create a MaggieMoo character and storyline. The walls of stores are adorned with colorful cartoons telling Maggie's "tail." She's also been given a family: a "moo-ther" and her sister, "Little Moo Cha Cha."

The menu has been updated, with new products and cute names. The "Cowabunga Moo," for example, is a 10-oz. serving of ice cream with four mix-ins. Gift certificates are called "moo-lah."

There is also a retail corner in the stores, featuring cow hats, T-shirts and sweatshirts with the MaggieMoo's logo.

Franchisees who have converted to the new format say sales have increased.

"It's basically night and day, the change" since Sharoff bought the franchise, said Jack Fisher, a franchisee in Leawood, Kan. Fisher said his sales had gone down every year, and not a single new product was introduced. But since he introduced the new design and products, sales are up 12 percent.

In August, Fisher introduced a blend of fresh fruit and yogurt or sorbet, and sales jumped 22 percent over August 1996.

MaggieMoo's had survived for so long simply on the quality of its product, Fisher said. That brand equity is what convinced

Sharoff that MaggieMoo's had great expansion potential.

"The brand-name equity in Kansas City was phenomenal," Sharoff said. "Everybody had heard of MaggieMoo's. People raved. The excitement for me was to take a concept as strong as it was with no spin and no sizzle and really make it into something."

Pub Date: 1/05/98

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