In conversation with Franchise India, Vikrant Tomer, COO-International, Ice-cream Lab, talks about the Nitrogen Ice-cream market and their Indian Expansion plans.
With constant innovation happening in the ice cream market, different ice cream variations are emerging. One such variation is Nitrogen ice creams, which are prepared live, according to the customer’s preference, and using liquid nitrogen to instantly freeze the all-fresh natural cream base.
In conversation with Franchise India, Vikrant Tomer, COO-International, Ice cream Lab, talks about the Nitrogen Ice cream market and their plans of expansion in India.
The Eureka Moment
Ice cream Lab was the invention of two 18-19-year-olds, who were bored of normal ice cream, packed or frozen. They wanted a fresh product, which is made from fresh milk to ice cream.
That’s when they came up with the idea of preparing fresh ice cream, but faced the dilemma of how to freeze it instantly. That’s when the liquid nitrogen came in the picture.
This is how the concept initially got built and kick-started in California in 2013.
Vikrant said, “We took over the brand in 2014 and are based out of Dubai, and five years from then, we are in almost nine countries including Malaysia, UK, Portugal, India, Nigeria Iraq and entire GCC.”
The scenario of the Ice cream Market in India
The ice cream business holds great opportunities. Ice creamis one category which has not been explored in the detail that much, except for a couple of brands. So, the bandwidth is very high. The best part of the ice cream business is that your capital expense and your operating expense are not very high and your return on investment is marginally better than other kinds of food businesses.
“Ice cream is an impulse buy; it is not panned and peope try flavours bases on what they feel like having on a particular day. Now, it is also not a seasonal buy. Earlier, people used to have ice creams only in the summers. The best part is if you are happy you will want to eat ice cream. If you're sad you're going to eat more ice creams. That is how it is. People love ice cream. This is exactly what we felt in our journey also and we are very passionate about what we do,” stated Vikrant.
International Expansion strategy: Creating a Strong Base
Our expansion strategy for the international market remains the same. Let’s say in India, we are seeking partners to open more doors of our brand, and the working has been happening since last year. We are working on the logistics’ part as well as on the supply chain for the last two years and in understanding the market.
Before we even try or plan to enter, we fix the logistics since that is the backbone. If you are not a master of logistics, you are most probably going to fail.
So, we ensure that we do our homework well. We identify our vendors first and then we enter into the franchising.
So, that's how the success is strategised by us: we solve all the teething issues before we are open the door for customers.
So you can imagine, for opening the first outlet in India, it took us three years because there's so much back working we have done, the studies we have conducted. So, it becomes much easier for us to expand because we build the base. As you know, Burj Khalifa took three years to build the base, and one year to develop the whole building. So, that’s the philosophy we follow.
Investment required for an Ice cream lab franchise is very nominal. The startup investment is just INR 15 lakhs. In 15 lakhs you can get a kiosk ready for selling.
Small format like kiosks, which is 200-250 sq. ft. in area, you can get it up and running in 15 lakhs, that's inclusive of all your capital expenses and operating expenses for the first two months.
After these two months, the operational expenses will cost not more than 30 to 35 per cent.
The profit margin is around 32 per cent, excluding corporate salaries.
Future Expansion Plans
All the franchises which we’ve opened are doing fantastically well and they're profitable. We have grown from one store to almost 15 stores across the globe in 5 years and in next six months, the number will be around 34 because all the stores are on their final stages, and will open their doors for consumers soon.
In India, we are committed to open another 100 outlets in the next three years. All across the world, we are targeting to open 560 outlets in next 3 years. As we have already signed off outlets that are going to open.