Cold Stone Creamery opening in Shanghai on April 23

Perhaps it will be different in Shanghai, but in my opinion, from an investment standpoint, Cold Stone is a DISASTER!!!

I am an Ex-Cold Stone Creamery franchisee. I am currently suing the company in federal court for among other things: (1) fraud in the inducement (i.e. for selling to potential franchisees based on statements such as “profit by making people happy” and “Cold Stone’s franchise opportunities are about as solid as they come”); and (2) Cold Stone effectively charges more than the 9% enumerated in their franchise agreement because they negotiate and receive “kickbacks” from the very vendors that they require franchisees to use. Those “kickbacks” drive up food cost for its franchisees and makes many of them unprofitable. This is apparent by the large number of stores that are closing down throughout the nation.

Cold Stone has known for years that its franchisees have had serious profitability issues, yet they go out and negotiate deals that make their franchisees even more unprofitable. In my view, there is something inherently wrong with a company that negotiates deals with vendors that increase the cost to their franchisees. Those deals effectively pad the company’s own profits at the expense of its franchisees who suffer life altering financial failures and many are filing bankruptcy at an alarming rate. In my opinion, that is completely contrary to their core value to supposedly “do the right thing”. Cold Stone’s lack of care and concern for their franchisee’s well being is inexplicably disingenuous in my view.

On its website, Cold Stone Creamery boasts its average store generates $381,985 in annual sales. We had three stores and they were performing well above the national average. Two of our stores did $500,000 each in annual sales, which is more than $100,000 above the company’s national average. We operated a store near a large college campus that was among the top Cold Stones in the entire nation. With $1.4 million in sales between the three stores—Cold Stone Creamery repeatedly recognized us as outstanding performers among stores throughout the nation and within our region. Even with such a large sales volume, we still could not earn a profit. This from a company that promised us 20% profits.

There are Cold Stone Creamery franchisees who are pumping several thousands into their stores each month just to cover their losses. One franchisee told me, after investing $300,000 to open his store, he is losing $4,000 to $7,000 per month. A franchisee in Florida recently told me that he lost nearly $132,000 in just one store during 2007. That’s alarming.

We are also suing Cold Stone for scuttling a sale to a potential buyer. According to this comment (http://www.bluemaumau.org/reco..., we are not alone in that complaint.

I don't know much about Kahala (Cold Stone's parent company) because they only recently purchased Cold Stone. However, if Cold Stone is their flagship brand, in my opinion, you have to wonder about the genius of this acquisition. This I do know, Cold Stone has been an absolute nightmare of an investment for many of its franchisees—myself included.

Cecil Rolle

cecilrolle@aol.com

You have another alternative, it is Amorino. It is not given but it is the best ice cream I never eat in Shanghai www.amorino.cn it is daily fresh and you can feel it...

Bump. Note that the date announced at the time was tomorrow, Apr 23.

give it a break

coldstone creamery is not THAT bad

unfortunately, cozy neighborhood mom-and-pop ice cream stores serving delicious home made ice cream is a dying breed

out of what's left, i simply don't find that many alternatives

if you like this, you will like anything!

to each his own i guess

i think their ice cream is decent enough, and i do like the crepes they serve it in

well at the very least, when haagen-das is the only alternative everything taste good...

OMG is right. CSC sells the worst ice cream ever and mixing it in front of me won't make it any better! Bad business concept and ice cream for idiots!

Oh my goodness...Cold Stone Creamery!

The only one within my reach here in the US just closed down!

I guess i know where i'm going next i'm back in shanghai!

Taipei 101 is the tallest building in the world, FYI.