Self-Serve vs. Full Service Frozen Yogurt Businesses: Which Has the Higher Profit Potential?

New frozen yogurt shops are opening daily nationwide. Frozen yogurt shops are increasing in popularity as Americans are increasingly more focused on health. Americans are making healthier food choices and choosing frozen yogurt shops over traditional ice-cream parlors. Most yogurt shops are full-service. However the operating model of yogurt shops has changed over the last few years and is shifting from a full-service model to a self-service model. Self-service frozen yogurt shops are currently trending and the trend is forecasted to continue in the next few years. These self-service stores are producing profits.

New stores are opening as completely self-service establishments and existing businesses are changing over their operations to the self-service model. TCBY, an industry leader, is following this trend as well. The full service model is where an employee fulfills orders for customers. Self-service simply means customers help themselves. Customers go down the line of yogurt flavors and toppings and select their yogurt themselves as well as add any toppings themselves. Customers pay a cashier at the end of the line based on weight or size of their selections.

According to IBISworld.com, sales in this industry have grown over the last several years and they are predicting that it will continue to see steady growth as a whole but not at a rapid rate. Profits will have to be spread amongst many companies as competition increases. It has been forecasted that the most profitable shops will be those that operate based on the self-service model.

There are many advantages to a self-service business model including lower payroll costs and also happier customers. A typical full-service store staffs four or more employees whereas a self-service store only needs 2 or more employees. The decreased payroll costs increase profits for the owner’s bottom line. Speaking of lines, nobody likes to wait in line. In a self-service store customers spend less time waiting in line for an employee to take and fill their order. Wait times are dependent on the customer themselves, not the employees. Less wait time means a happier customer and a happy customer usually becomes a repeat customer.

There are many advantages to a self-service yogurt business but there are several downsides as well. Disadvantages include product waste, theft and accidents. It is necessary to figure in product waste, theft and accidents into your costs as the general public will be helping themselves with little to no supervision.  Also, having less employees can be a disadvantage if you desire to add jobs to your community. It can also be difficult to secure financing that favors or requires job creation.

In summary, a self-service model yogurt business can be a profitable business opportunity to consider with an increasingly more health conscious population and the popularity of self-service business models that reduce payroll costs for owners and provide a more convenient experience for customers. The Self-service yogurt business is expected to grow into the future.

About The Author: Peter Siegel, MBA is the Founder & President of BizBen.com. BizBen.com is a website that lists businesses for sale and businesses wanted to buy in California. The site also contains resources, & articles related to the buying and selling of small to mid-sized businesses. He is also the Founder and President of  the BizBenNetwork Online Community. Reach him at 866-270-6278866-270-6278 to discuss strategies regarding buying, selling, and financing small to mid-sized businesses.