by Lance Turner
Posted 6/30/2011 11:32 am
Updated 2 years ago
Yarnell's Premium Ice Cream of Searcy, an iconic Arkansas company and one of the largest privately held ice cream companies in the U.S., confirmed Thursday that it has ceased operations, affecting 200 employees.
"This has been an extremely tough year for the ice cream industry in general, and particularly to regional, independent manufacturers like ourselves," Christina Yarnell, the company's CEO and great-granddaughter of its founder, said in a news release.
"We have examined many possible avenues to keep the company afloat - actively marketing the company to investors and strategic buyers - the majority of whom are undergoing the same financial distress we are. However, we've been unable to obtain additional financing from our lenders or locate a buyer, and have come to the difficult decision that the appropriate course of action is to shut our doors."
Word of the company's demise began circulating early Thursday morning, with posts about the closing surfacing on the company's Facebook profile and Wikipedia page. Later Thursday morning, Christina Yarnell posted an official notice on Facebook.
"We are truly thankful for our amazing employees and the heart and soul that they have put into the past successes of this company," she wrote. "They are great people. And I can't say enough about our customers and your loyalty to Yarnell's."
The company said a small team will remain at work through Aug. 27 to finalize operations. Matt DeCample, a spokesman for Gov. Mike Beebe, said the state Department of Workforce Services is already reaching out to employees to help them figure out what comes next.
(More: Gov. Mike Beebe, who practiced law in Searcy and represented the city in the state Legislature, comments on the company's closing.)
Yarnell's was founded in 1932 in Searcy. It has branch operations in Arkansas, Mississippi and Tennessee, and serviced supermarket, convenience store and foodservice customers in Arkansas, Tennessee, Mississippi and parts of Missouri, Kentucky, Texas, Oklahoma and Louisiana.
In addition to its Yarnell-branded ice cream products, the company had forged a distribution relationship with Nestle, the largest food company in the world. The company also produced ice cream products for several Fortune 500 food companies.
Yarnell's was also highly visible among Arkansans, with its Razorbacks line of ice cream flavors, including Woo Pig Chewie, and its sponsorship of major Arkansas events, including Riverfest, the annual arts and music festival in Little Rock's River Market district.
Arkansas Business profiled Yarnell's during its 75th anniversary in 2007.
Family patriarch Ray Yarnell bought the bankrupt company he worked for, then known as Southwest Dairy Products, in 1932 near the height of the Depression in Arkansas, using between $5,000 and $25,000 borrowed from his wife's side of the family.
Albert Yarnell Sr. returned from World War II and began expanding the company, overseing the company's first major plant expansion in 1951. The expansion allowed the company to sell throughout central and south Arkansas.
In 1974, Albert Yarnell Sr. became president after his father's death. Under his leadership, the company developed health-conscious ice cream offerings.
Albert Yarnell Sr. is now the company's chairman emeritus. CEO Christina Yarnell is one of his granddaughters.
Members of the Yarnell family have had legal disputes in recent years, including a lawsuit filed in 2008 by Albert Yarnell Sr.'s daughter, Melissa, against her brother, company president Albert Rogers Yarnell II. The lawsuit was settled in December.
ArkansasBusiness.com will update this story.
Yarnell's Premium Ice Cream ceased operations today after the Board of Directors voted yesterday to end production indefinitely. The privately owned company, headquartered in Searcy, Ark., told its approximately 200 employees today that they would be paid through every day worked but not beyond that.
"This has been an extremely tough year for the ice cream industry in general, and particularly to regional, independent manufacturers like ourselves," said Christina Yarnell, chief executive officer of Yarnell's. "We have examined many possible avenues to keep the company afloat - actively marketing the company to investors and strategic buyers - the majority of whom are undergoing the same financial distress we are. However, we've been unable to obtain additional financing from our lenders or locate a buyer, and have come to the difficult decision that the appropriate course of action is to shut our doors."
Approximately 75 percent of Yarnell's employees work at the Searcy headquarters, with the rest of the employee base located throughout the state and in Tennessee and Mississippi. A small team will remain working for the company to finalize operations, with completion expected by Aug. 27.
"Yarnell's has been an Arkansas staple for more than 75 years, and it's been a family business that started with my great-grandfather, Ray, and has involved four generations of the Yarnell family. Ceasing operations is heartbreaking because we have prided ourselves on keeping our roots in Arkansas, particularly Searcy.
"We are truly thankful for our amazing employees and the heart and soul that they have put into the past successes of this company. They are great people. And I can't say enough about our customers and their loyalty to Yarnell's. It's been a pleasure creating the highest quality ice cream that they can be proud to serve to their families and friends. I, personally, will miss hearing their wonderful feedback and encouraging comments."
Sales of ice cream and related products have steadily declined over the past five years across the United States. In order to compensate for declining sales, the larger manufacturers continue to jockey for retailers' shelf space through price competition. This, along with steadily increasing commodity prices (cream, sugar, fuel, etc.), has resulted in significant financial damage to regional ice cream manufacturers such as Yarnell's.