Ice cream plus

Milkin Corp. is in the middle of its 10-year business plan. Phase one involved building brand awareness and customer loyalty for the Fiorgelato brand of ice cream. Phase two will involve going overseas, specifically in Asia, through franchising.

"We are looking at the sustainability of the business for the long haul. Our franchisees do not want to be known as being just an ice cream business," said founder and president Ricardo Cuna.

Towards this end, Milkin has widened its product range–not just in terms of the kinds of ice cream flavors and textures sold (currently numbering 29) but also in terms of adding non-ice cream products and its business models.

Fiorgelato currently has 59 outlets nationwide, 60% of which are located in Metro Manila. Of the total, 40 of the stores are operated by franchisees.

Aside from the usual cart and kiosk business models, Milkin is now offering the counter, which can hold four tables and serves ice cream as well as coffee, sandwiches, and pastas. "These are suitable in schools, groceries, offices, malls, and even street-level areas," said Cuna.

Investment for a Fiorgelato counter is at least P500,000. Based on its location, the investment for a cart or kiosk located in a school is cheaper at P180,000 than one located in a mall, which would cost P200,000. Payback is between one and two years, with some investors recouping their investments faster at three months to five months.

In the works are the Fior Café, which is patterned after Italian street cafes, Fior Snack Bars, and Gelateria and Pasticceria that combine restaurants and cafes.

Gelato

Milkin started out in 1989 as a Filipino-Italian business venture, with the exclusive right to manufacture, sell, and distribute an Italian brand of ice cream called Fiorgelato in the Philippines. The company eventually sold its rights and equipment to Cuna’s Manila Ice Cream, which produced home-made ice cream for institutional buyers as well as for events such as children’s parties.

"We produce gelato, which means frozen delight in Italian and which has significantly less butter fat and is denser than regular ice cream. Because our products have less butter fat, the flavors are more intense. Unlike ice cream, which is 75% water and air and 25% milk, our products are 100% milk," said Cuna, who attended short courses on the gelato business in the United States.

Franchisees

Milkin’s requirements for potential franchisees are stringent. Aside from having a location with high foot traffic, the franchisee must be business-minded, capable of personally attending to daily business operations, and able to comply with set operational standards.

"When I interview potential franchisees, I ask them to re-apply after at least three years of a successful business. I ask them what are their expectations from the franchise. I tell them that we are going to be in this business not just for 10 years but possibly for a lifetime," said Cuna. "I am here to protect the franchisees’ interest as well as my business."