From the January 1998 issue of Entrepreneur

No doubt about it, it's a cold world out there. But that's no problem for three brothers in Markham, Ontario. As the founders of frozen yogurt giant Yogen Früz Worldwide Inc., Aaron, Michael and Simon Serruya are heaping up cool profits the world over--in 81 countries, to be exact. In October, the brothers were named Young Entrepreneurs of the Year for Canada. And as if that weren't enough, for the second year running, these entrepreneurs have secured the number-three spot in Entrepreneur's annual Franchise 500®. So what's the scoop? Theirs is truly a story of sweet success.

Breaking The Ice

Today, Yogen Früz boasts more than 3,600 stores worldwide and 1997 sales of $360 million. That's due in part to the company's acquisition within the past three years of the Canadian franchise Paradise Juice Bar and the American chain Golden Swirl, as well as I Can't Believe It's Yogurt (ICBIY) and Bresler's Ice Cream & Frozen Yogurt, two American franchises that had already formed strong footholds in the international frozen fare market.

In October, Yogen Früz extended its reach even further through a merger with Integrated Brands, parent company of Swensen's Ice Cream, Heidi's Frogen Yozurt and Steve's Ice Cream--adding 400 additional stores to its skyrocketing tally. The Integrated Brands stores, which will keep their individual names, bring the Serruyas another perk and give their franchise operation a fresh angle: exclusive rights to frozen desserts from such well-known brand names as Tropicana, Betty Crocker and Yoplait.

"I don't think in our wildest dreams we ever fathomed we'd be where we are today," says Michael, 33. "It all just kind of happened, and every once in a while you look back and say `Wow!' "

All this excitement can be traced back to a dream--and a $100,000 investment from the Serruyas' father. Initially, the brothers wanted to purchase master franchise rights to Canada from one of the large, established U.S. frozen yogurt franchises. Easier said than done, remembers Aaron: "I was 19 at the time, and Mike was 20," he says. "We didn't get much respect when we went to see those franchisors."

That stumbling block set the stage for the brothers to set out on their own--and make frozen yogurt history. Michael enlisted the expertise of a leading Canadian design firm to iron out the entire Yogen Früz concept, while Aaron worked for months with a food technician perfecting their frozen yogurt flavors. A year later, in 1986, they premiered the store--and were so successful, they paid their father back within six months. By the time Simon, 27, jumped on board three years later, Yogen Früz had franchised an impressive 100 locations across Canada.

Keeping Their Cool

Through it all, these entrepreneurs haven't lost sight of what they see as key to their phenomenal growth--that franchisees play a vital role in the success of any operation. Perhaps it helps that they've seen the business from both sides, since their father was a bagel shop franchisee. "We run our business like a family business, I guess because of the way we were brought up," says Aaron, 31. "When it comes to franchising and dealing with franchisees, [we look at it as] these are people who are putting their livelihood in your hands. They've saved up enough money to get into business for the first time on their own, and they've chosen you. So for me, it's a compliment they're giving us, and making them successful is a goal I want to achieve."

Latin America and Asia continue to show the most interest in the Yogen Früz concept and are experiencing tremendous growth. Take one of Yogen Früz's franchises in Venezuela: The store is so busy, it's probably the only frozen yogurt shop in the world that offers valet parking to its patrons. "The city closed us down because of the amount of traffic [the customers] were creating," says Aaron. In response, their franchisee hired eight valets to alleviate the congestion on the crowded one-way street.

Looking ahead, the brothers expect to grow through diversification and more acquisitions. They envision a new concept for the future, one that takes co-branding to a much higher level: Imagine a shop where franchisees can house all their parent company's frozen desserts under one roof, ultimately offering a wide enough range of treats to satisfy every individual who enters the store. "As we continue to add more and more world-class brands to our family, it gives our franchisees the opportunity to pick up other concepts they can offer within their store," says Michael. "It's this whole idea of co-branding and nontraditional growth that we're seeing so strong in our industry today."

While countless fads come and go, the Serruya brothers long ago banked on the idea that frozen yogurt was here to stay. By trusting their instincts--and believing in the unlimited potential of the frozen dessert market--they've achieved what few so young have, and in such a short period of time. For three entrepreneurial brothers who dreamed of going into business together, destiny certainly has not left them out in the cold.

Contact Source

Yogen Früz Worldwide Inc., (905) 479-8762, fax: (905) 479-5235