Dairy Queen in the UK - Do They Franchise?

10/01/2019 18:00 | Fast Food Franchises

Dairy Queen Franchise

Though Dairy Queen is an iconic US brand, it is relatively unknown in the UK. However, this hasn't stopped UK investors from expressing an interest in bringing the highly successful franchise to British shores. Here, we take a look at what Dairy Queen is, where it comes from, and whether it offers franchising opportunities in the UK.

What is Dairy Queen?

Dairy Queen is a US-based ice cream parlour chain that boasts a network of around 6,800 locations around the globe. Approximately 4,450 of these are in the US. The chain serves various types of ice cream, with their most popular product being the Blizzard a soft-serve ice cream that is so cold it can be turned upside down without falling out of its tub. The Blizzard comes in an array of flavours, including Oreo Cookies, M&Ms, and Reeses Peanut Butter Cups.

The company operates different types of Dairy Queen restaurants, ranging from standard, stand-alone stores to Dairy Queen Grill and Chill locations (which feature table delivery of hot foods alongside the traditional ice cream menu) and Texas Country Foods stores (which feature their own unique hot food menu). While Dairy Queen has attempted to standardise restaurants across the US slowly, there remains considerable regional variation.

A brief history of Dairy Queen

John and Alex McCullough invented the soft-serve recipe that would go on to form the basis of the Dairy Queen business model in 1939. They convinced their friend, Sherb Noble, to stock the product in his store and, on the first day of offering it, he sold more than 1,600 servings to local customers. The overwhelming success of the product convinced Noble and the McCulloughs to go into business together and the first Dairy Queen store opened in Illinois, in 1940.

The company were early adopters of the franchise model, as it allowed them to expand at a rapid rate and begin opening locations up and down the country. The chain proved particularly popular in the southern and Midwestern states and became a fixture of small towns throughout the area. For this reason, Dairy Queen is often associated with small town USA, and the business has successfully incorporated this sense of nostalgia into its brand and advertising. Starting with ten stores in 1941, the number of outlets had grown to 1,446 a decade later, and 2,600 by 1955.

In 1962, the company changed its name to International Dairy Queen and, in 1987, purchased the Orange Julius brand. Since then, Orange Julius products have become a staple in the vast majority of Dairy Queen restaurants. In 1998, Berkshire Hathaway, an American holding company that also owns Duracell, Fruit of the Loom, and GEICO, purchased International Dairy Queen.

Who is in charge at Dairy Queen?

At the head of Dairy Queens parent company, Berkshire Hathaway, is one of the United States most successful investors, Warren Buffett. As the CEO of Berkshire Hathaway, he is ultimately responsible for the Dairy Queen brand, though the Berkshire Hathaway portfolio is so broad and diverse that he has little to do with the organisation on a day-to-day basis. Instead, Troy Bader, the CEO of Dairy Queen, is responsible for the management of the chain. Though he has been in the position for little over a year, he has considerable experience in the franchising sector and a background in law and business administration.

Dairy Queen in UK

Currently, there are no Dairy Queen restaurants in the UK. Though the brand is something of an institution in the US, it does not benefit from the same brand recognition in the UK. This has meant that the company has been wary of attempting to make the jump across the Atlantic without sufficient preparation. The chain is also aware of the way in which other US brands, most prominently Steak and Shake, have been forced to close their doors in the UK, having made an unsuccessful transition. Though the two countries are similar in many ways, there still exists a considerable gap between culinary cultures.

Dairy Queen London UK

However, there have been strong rumours that Dairy Queen was looking into opening a location in the UK capital. Though this restaurant is yet to materialise, it is possible that the company is merely biding its time and waiting for the right investors to approach.

Dairy Queen UK franchise

If Dairy Queen were to expand into the UK market, it would likely be via a master-franchise arrangement through which they hand over the rights to develop the entire region to another organisation. This organisation would then sub-licence franchisees throughout the UK. This would ensure that someone with in-depth knowledge of the local market runs UK operations.

Though it is not clear whether the business is currently offering master-franchise investment opportunities, interested parties should contact the franchise directly for more information. Even though a considerable amount of capital will be required to launch the brand in the UK, it may well prove a remarkably profitable market.

Where does Dairy Queen operate?

Besides the US, Dairy Queen operates in more than 25 countries. While around 70% of its stores are situated within its home market, restaurants also exist in Thailand, Vietnam, Mexico, South Korea, Saudi Arabia, Egypt, China, Canada, and Cambodia, among others. There are also plans to expand the Dairy Queen brand into lucrative, new markets such as India, Brazil, and Japan. All of this growth is likely to be facilitated by the franchise model.

Are there franchised alternatives to Dairy Queen?

There are many alternatives to Dairy Queen UK that do offer franchising opportunities. For instance, Baskin Robbins is another US-based brand that retails ice cream products. It already boasts 150 stores across the UK and is currently looking for new franchisees to expand the brand further. Franchisees will need to make a total investment of approximately £500,000 to launch a Baskin Robbins franchise, and the franchisor is looking to work with individuals or organisations that hope to open multiple locations.

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