Despite hot summer, red-hot inflation chills ice cream truck profits

It’s been a scorching summer across much of Canada, but that’s no comfort to ice cream truck operators like Meedo Falou, who says inflation and high fuel costs are melting away their profits.

On a sweltering Thursday morning, the owner of Rainbow Ice Cream in Coquitlam, BC, pores over a computer spreadsheet and talks to drivers about their routes.

Some flavors are in short supply and Falou is focused on the efficiency of his fleet of 10 trucks.

The problem isn’t just high gas prices, Falou said.

“Maintenance went up. Truck parts went up. Mechanical parts went up,” he said in an interview.

“Ice cream is up more than 60 percent. We had to raise the price by a dollar. We couldn’t do more because of consumers. We just want them to be able to afford ice cream.”

Steve Christensen, executive director of the North American Ice Cream Association, said vendors face a variety of challenges.

“Gas prices have gone up,” said Christensen, speaking from Missouri. “So a lot of everything, cones, cups, different things, everything that needs to be delivered by truck has also gone up in price.”

many challenges

Ice cream prices typically go up 3 to 5 percent a year, Christensen said. But she said this year, prices are up 10 to 15 percent, though that might not be across the entire menu.

Falou said he has tried to keep prices under control.

“In this business you don’t make a profit on one piece,” he said. “You also make a profit on volumes. I want [people] to be able to afford to buy ice cream from the ice cream truck. I don’t want to give that bad image that the ice cream truck is so expensive, you know.”

Falou hopes to “earn a little” without dipping into his savings as he did during the last two years of the pandemic.

It’s been a tough year, said Falou, who closes Rainbow Ice Cream from late September through April each year.

“We got hit by bad weather in the spring. It was the wettest weather in June. So that hits our sales a lot. And definitely the profit is much lower than previous years.”

Just like everything else, the price of ice cream has increased at a much faster rate than normal this year. (Nina Westervelt/Bloomberg)

It’s not just the local weather. Global weather events also affect the ice cream business, Christensen said.

For example, Madagascar provides about 70 percent of the world’s vanilla, and when there’s a storm there, or a short blooming season, it affects the global market.

“Which again, you know, affects the ice cream,” he said.

The curse of the ‘ghost kitchens’

Christensen said old-school ice cream truck vendors also have to contend with new challenges, such as delivery apps and rivals in so-called “ghost kitchens” that lack a store but sell ice cream online.

“The overload [for a ghost kitchen] It’s so cheap. They’re using social media to promote their ice cream, they’re selling it online and people are coming to pick it up from the kitchen or a place.”

Falou started out driving an ice cream truck in the 1990s, which he called the “golden days” of the business. She said that she made a lot more money then.

To overcome the hurdles of apps, weather, gas prices and inflation, Falou said he hopes there will be a return to corporate events and other scheduled bookings, which were curtailed during the pandemic but are now making a comeback.

“We do suffer,” he said, shaking his head. “We rely heavily on corporate events, birthday parties, pageants and weddings and all that. So this year, they’re starting to come back. Some of them, not all of them. So hopefully next year we’ll have them all.” back.”

But gone are the days when an ice cream truck could boost business by simply driving around and playing a happy tune, Christensen said.

Trucks ‘need to hurry up’ now

“Ice cream truck owners should look for catering opportunities, food truck events, go to office blocks and hospitals and say, ‘Hey, we can host a corporate event for you,'” he said.

“They need to rush a little bit more now than they probably have before.”

Christensen recalled his first exposure to the ice cream business, listening as a child to the traditional jingle of the truck in his home country of Australia.

“And little Steve Christensen goes and gets some money out of mom’s dresser and goes out and buys the cone with a Flake in it,” he laughed.

“I’d like to think that people still love those experiences. So I think the process of supporting your local ice cream truck is very important, because it keeps those memories alive for kids these days.”

Do you have questions about this story? We are answering as many as we can in the comments.

Leave a Reply

Your email address will not be published.