Like many frozen yogurt brands, Tutti Frutti got its start in Southern California, but what sets the chain apart is its operational model. The operation's 700 locations in 30 countries are run by licensees, who are supported by Wellspring Industry Inc., a supplier and wholesaler of soft-serve frozen yogurt mixes and equipment.
"The goal of our company is to cater to the market, rather than force products on consumers," says Jay Kim, Wellspring's president. "Our self-serve model provides customers with choices as well as control."
This has been a recipe for success, with Tutti Frutti's sales increasing almost 28 percent from 2012 to 2013 and unit growth at close to 22 percent in this same period, according to Technomic, a Chicago-based market research firm.
FE&S spoke with Kim to find out more about Tutti Frutti's business model, flavor offerings and plans for the future.
FE&S: The frozen yogurt segment is pretty competitive. What makes Tutti Frutti unique?
JK: While some chains in this segment are moving away from frozen yogurt, we're staying true to our roots. In our shops, we're trying to incorporate different flavors and products associated with frozen yogurt. We don't consider ourselves to be just a concept, but a brand.
FE&S: Many chains in this segment have seen growth through franchising. Is that Tutti Frutti's model as well?
JK: We have a licensing, rather than a franchised, model. This differentiates us because store owners have more control of their business. While we don't have as many restrictions as a franchise has, licensees still need to adhere to product quality requirements. Our partners can purchase equipment either through Wellspring or their own vendor, as long as it meets local health code requirements. We've been able to build good, trusting relationships with store owners in this arrangement.
FE&S: In this type of segment it can be more challenging to differentiate menu offerings. How has Tutti Frutti accomplished this?
JK: We have our own proprietary product that is attached to the Tutti Frutti Frozen Yogurt name. Our menu concentrates on frozen yogurt, but we're not locked in to just the typical flavors like vanilla and chocolate. Because our brand is national and international, we also include regional and global flavor preferences. In addition, we have options for vegans, vegetarians and those on restricted diets. For example, our vegan Soy Bean Frozen Yogurt is made from non-GMO soybeans, and we offer a nondairy sorbet line for those sensitive to lactose. In the past year, we introduced a smoothie line for those who prefer a beverage-type product. Some of our stores offer waffles, waffle cones and waffle bowls to complement our yogurt offerings.
FE&S: With locations nationwide and internationally, does Tutti Frutti need to adhere to different product requirements?
JK: We offer our proprietary powder products with live, dormant probiotics that become active when mixed with milk. These powders make storage and handling much easier for store owners. Proprietary liquid products are available in the states of California and Pennsylvania, where local state laws require all yogurt to be sold in liquid form.
FE&S: Today's frozen yogurt shops are known for offering a wide selection of flavors and toppings. Describe a typical Tutti Frutti menu.
JK: We have more than 100 flavors that constantly rotate. The number of offerings depends on how many machines the store has. Each store will have between 4 and 10 machines that offer 2 flavors each. The flavor rotation is up to each store owner. Some keep the same menu for a month or two, while others may rotate on a weekly basis. It is dependent on what the local market demands. There can be anywhere from 40 up to 80 toppings as well. These include dry selections like candy, nuts, cookies and coconut flakes as well as fresh fruit, syrups and sauces. We've also provided savory products, like trail mix.
FE&S: Obviously, flavor popularity depends on the region, but what are the universal preferences when it comes to frozen yogurt?
JK: Typically, chocolate and vanilla are the most popular, but fruity flavors also are in demand, especially strawberry and mango. We also offer our signature Frutti Pebbles, made with traditional fruit-flavored rice cereal and milk, that tastes like a frozen version of the classic breakfast cereal. We try to have a new featured flavor at least every two months and keep adding to the list. We rarely retire any of our yogurt varieties.
FE&S: It seems most frozen yogurt shops don't have large footprints. Is that true for Tutti Frutti's model?
JK: Our square footage ranges from small 250-square-foot airport kiosks to more than 2,000-square-foot locations with party areas. On average, our sites are between 800 and 1,000 square feet. There is typically a maximum of 30 seats. Our atmosphere is modern with warm, bright colors. The back of house encompasses between 20 and 30 percent of our stores.
FE&S: How does your equipment support the menu?
JK: We co-manufacture and distribute frozen yogurt machines under our Wellspring name. We also utilize ice makers and blenders for smoothies. For locations that offer baked goods, there will be deck ovens and other baking equipment and supplies. While some stores have walk-in freezers, most utilize upright freezers and refrigerators.
FE&S: You've recently unveiled a new marketing strategy to help further differentiate the Tutti Frutti brand. How does this fit in with plans for the year ahead?
JK: Last year, we introduced our new TF Friends mascots, including Candyce Prinkle, Betty Red, Viola Blu and Banana Bo, to enhance our child- and family-friendly brand. We're also looking at different options, including new products, different flavors and possibly a new look for Tutti Frutti Frozen Yogurt stores in the future.