No Freezer Burn as Yarnell's Ice Cream Grows With New Owners

by Mark Friedman  on Monday, Jan. 20, 2014 12:00 am  

Concerns

But there were just as many concerns.

One was the cost of operating the 50,000-SF ice cream plant. The utility bills, which included operating an ammonia system to freeze the ice cream, ran about $50,000 a month, Boyle said.

And if anything goes wrong with the ammonia system, “it’s a very bad thing,” he said.

Boyle said Schulze & Burch made sure there would be enough insurance coverage for the mechanical system if the ammonia system failed. The company also brought in ammonia experts to inspect the system as a precaution.

Another issue: After acquiring the property, generating sales would take time. “When you buy something out of bankruptcy, typically you have zero sales,” Boyle said.

In addition, the plant is operational, “so it’s expensive right after the acquisition without a sales base,” Boyle said.

And he didn’t know if the public had cooled toward Yarnell’s after the product was unavailable for more than six months. “When something is off the shelf for a period of time, it tends to be forgotten,” he said.

Also a concern: Would retailers give Yarnell’s another shot after being left without inventory during the crucial Fourth of July week in 2011? “The retailers were told during the busiest ice cream-selling week of the year that Yarnell’s was closing,” Boyle said. “And that left them in a real bind.”

Relaunch

In December 2011, Schulze & Burch won the auction to buy Yarnell’s property, which included its plant, factory and warehouse equipment, for $1.301 million. It also bought Yarnell’s intellectual property, which included its ice cream recipes, for $38,940. After Bankruptcy Judge James Mixon approved the sale on Jan. 9, 2012, Schulze & Burch began preparing the factory to turn out ice cream.

But there was an immediate emergency. Schulze & Burch had to locate a supplier for a 48-ounce ice cream container.

 

 

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