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Frozen yogurt bubble bursting as closures mount
November 16th, 2009, 5:47 am · 74 Comments · posted by Nancy Luna, Staff Writer
Bliss Froyo in Orange is among several froyo shops that have closed in O.C. recently.
Orange County’s froyo craze appears to be crashing after nearly two years of steady, out-of-control growth.
Several shops have shuttered over the past few months with the latest closures occurring to one of the industry’s biggest brands — Red Mango. The chain, one of Pinkberry’s biggest rivals, closed shops in Fullerton and Laguna Niguel. (O.C. Froyo Frenzy map tracks openings & closures)
Others going down recently include Cefiore in Irvine, Yogurtlicious in Fullerton, Beach Berries in Costa Mesa, Bliss Froyo in Orange and New Zealand Natural Ice Cream & Frozen Yogurt, also in Orange.
New Zealand Natural Frozen Yogurt shutters at the Stadium Promenade in Orange.
Operators blamed the closures on everything from the tanking economy to an over-saturated market.
“We did close the Red Mango units in Fullerton and Laguna Niguel, which was a result of bad real estate decisions,” said Dan Kim, founder of Dallas-based Red Mango.
Dan Finch, a long-time Golden Spoon Yogurt franchisee, said he began tracking the froyo trend two years ago when stores started popping up all over the county.
He did it out of survival.
At the time, he operated five Golden Spoons in Orange and Los Angeles counties. He’s since sold two of his shops, and now owns three Golden Spoons in Orange and Fullerton. All three shops have added tart fruit flavors to better compete with new concepts such as Cherry on Top, Yogurtland and Pinkberry.
At the peak of the froyo fad, Finch estimated the region had 175 shops. Over the past month, he said he has counted at least 13 shops that have closed. Los Angeles is also experiencing closures, including two Pinkberrys in West L.A., reports EaterLA.
“The froyo bubble has burst,” Finch said.
A key reason for the crash: there’s not enough demand to support every chain, Finch said.
During the peak summer season, sales at Finch’s three froyo shops were down 25 percent, he said. With the slow winter period approaching, Finch believes many independent frozen yogurt shops decided to bail before matters got worse.
That’s what happened to Bliss Froyo in Orange.
Owner Jewlee Yu said she had a loyal local following, but that wasn’t enough to turn a profit. She closed earlier this month and has plans to possibly open a coffee shop in Los Angeles.
“I feel that Yogurtland will
probably be the last one standing,” said John Chan, who recently converted his struggling Cefiore shop into Lollicup, a boba cafe at the Diamond Jamboree Center in Irvine.
The fading froyo fad is also hurting Spencer Huang, owner of Cantaloop in Santa Ana.
He opened his frozen yogurt shop last year in a new retail center that was expected to be anchored by fast-casual giant Buffalo Wild Wings.
But the chicken wing chain never opened, resulting in less-than-expected foot traffic at the outdoor shopping center near OSH. He’s now contemplating what to do.
“We definitely have felt the effects of the economy and do face challenges, ” Huang said. “And given that there doesn’t seem to be a silver lining to this recession, we are looking at all options.” (Cantaloop deal alert)
Tell us: Did you expect the froyo meltdown? Write in and let us know.
LIST of Restaurant Closures in O.C.
Related stories:
- Self-serve froyo chains invading O.C.
- Pinkberry to debut new drink on Friday in six locations, including Newport Beach
- Starbucks debuts Pinkberry-inspired drink
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totally saw this one coming…it was like the housing bubble but only yummier, it was almost a joke everytime a new froyo place opened
And this is a surprise to who? This isn’t about the economy, but about a fad franchise that over expanded. When these guys first showed up in LN, they came in with high prices, and product that didn’t make me want to switch from Golden Spoon, which I love. I never visited any of these shops, so obviously I don’t miss them. But I can tell you, the rate of expansion could never be supported, regardless of the economy. Who needs yogurt on every corner.
Golden Spoon thanks you for support, Ko!
Frozen Yogurt is just a fad.
Yogurt stores became all the trend in the late 70’s early 80’s. Only back then you served yourself, added your own toppings and paid by the weight. Those went bust in the late 80’s. Anyone see a pattern here?
I don’t remember the own topping and by weight way back when, that seemed to be a newer thing (to me). in the past I always ordered by size and they ask you what topping you want.
but the fact that a Golden Spoon across the street from South Coast plaza couldn’t even stay afloat 2 or 3 years ago didn’t speak highly for the consumers of OC being able to support all these places. there were at least twice as many as needed.
News flash.
I ( and many, many others) predicted this flush out of too-many “froyo” shops would occur as early as 2007.
To those of us who’ve been around to see it happen before, this occured with the Penguin’s/TCBY/Heidi’s/Me-Too frozen yogurt shops in the early 90’s after their phenomenal successes from the late 80’s to around 1994.
The public can only take too much of a good thing, regardless of the economy. Too many sugar shops for people to visit all the time, even if they had the $$.
Just as low carb craze killed Krispy Kreme’s rampant expansion, the over abundance of these yogurt stores spelled out the inevitable.
Its not over yet- more closures to come!
I would agree that Yogurtland will be one of the last standing, but also predict PInkberry will close some, being overpriced and less of a consumer friendly option for choosing customization, a trend coming into the fast food industry fast and furious, just like the recently featured blog on soft drink machines from Coca Cola.
History repeats itself, again and again.
Next fad, please?
Yogurtland will definitely be more resilient than all these other chains or mom n pops. they’re usually very busy due to having the best locations and larger, more attractive stores. I wouldn’t be surprised if they also have deeper pockets (corporate, if not franchisees).
I think Cherry On Top will make it too, since they’re pretty well run and decent locations.
Yogurtland is a franchised business.
I am well aware of this, which is why I said “corporate if not franchisees”.
consider a few things. one, franchises like Yogurtland typically try not to overexpand as quickly to dilute their brand and have better locations which are often scouted out by their corporate management. two, they also have greater reserve requirements than competing businesses, because the corporate office doesn’t want to see a bunch of them go out of business very quickly. so in a test of patience at a location, everything else being equal, they will win out over some mom n pop shop basically every time. three, their corporate ownership as a last resort will take over a good location with a bad owner, or help secure emergency financing, or other franchisees may step in to buy said franchise.
have you seen the Yogurtland on Harbor and Baker in Costa Mesa, or the one in Fullerton on Chapman? both are literally right next to Baskin Robbins, and both are always packed. can’t say that for other froyo shops in the same area. the Fullerton one even has another yogurt shop (Pinkberry, I think) right across the street, but easily does the most business out of these three.
been counting the days til this would happen… it was just total insanity with oversaturation and no individuality (all cookie cutter clones). plus now it’s wintertime. nobody wants to eat frozen yogurt for the next 3+ months.
1989 all over again… but bigger.
It’s wintertime in So California, which means it will be in the 70’s instead of the 90’s. I’ll still continue to eat frozen yogurt during the “winter” months. Even if it rains! And I’m sure lots of other people will too.
it’s 66 right now and our weather at the moment is considered a slight heat wave. tomorrow will be a high of around 60.
just wait until February, and if el nino kicks in look out.
good point. i thought the statement that it’ll be in the 70s instead of the 90s was a bit off. especially if this person has lived in OC for a while, they should know that the stereotype of the temp never dropping below 70 is exactly that, a stereotype. it was 43 at my house this morning. i’ve lived other places than here and 43 in OC is the same as 43 on the east coast, which is cold in either place.
I have lived in Orange County for over 40 years and I know that it will and does get colder than 70 in the winter. My POINT was that people will still eat frozen yogurt, even in the winter.
what happened in 1989 that compares to frozen yogurt shops closing?
all the overexpanded original frozen yogurt shops closed in the late 80’s - early 90s. Penguins, TCBY, joe blow etc.
a lot of out of business signs between 89 - 92. most didn’t come back, then 2009 almost 20 years to the date history repeats itself.
i’ve never even heard of any of these places. as long as yogurtland stays open i could care less
you mean you couldn’t care less. to care less means, well you could care less.
No shock about this happening - same thing has been occurring with sushi establishments; just way too many.
3 things:
It’s a fad…fad’s come and go…it’s wearing it’s self out.
Yes, the economy does play a role. Simply said, when you are watching your budget some items are cut which results in less spending, which in turn hurts the yogurt shop.
The next fad going to be hit will be the cupcake shops. Those owners better start preparing now……
I think that actually started before the yogurt thing got played out. there were actually cupcake closures if you check this blog going back about 6 months. but you’re probably right that there’s gotta be more to come.
I can think of one that just opened in Belmont Shore last month or so, and I gotta tell you they are the lamest cupcakes I’ve ever eaten. I predict a coming demise.
Ok, I understand the Froyo bubble bursting. It was just a matter of time. But Bliss closing is just sad. We never even went there for the froyo - they had awesome fresh crepes and coffee and cupcakes!!! They totally marketed that place incorrectly. If it had been marketed as a coffee and crepes place, maybe they would have done better? Because those were the best. I was so happy to discover Bliss this past summer and now I am sad! Where else will a get a fresh dessert crepe at 8pm in the Tustin/Orange area? Suggestions are appreciated.
of course Bliss was marketed wrong. it had a horribly outdated logo (hello, 1992) and the location was horrible as well. no one thinks of meats & tustin as anything other than a dump. that area is so blighted with dirty bums at the bus stops and the rancheros piling into the orange mall (or sorry, the village).
Actually, the Tustin Ave corridor has some of the best independent ethnic restaurants and cool funky stores in our increasingly homegenuous County. Only close minded racists think of that area as a dump. The more open-minded and adventurous see culinary opportunity.
Tustin Ave…starting with Malibu Fish Grill and Jerry’s Dog’s on one end with places like Darya and Zena on the other end (next to Bliss ironically and been in business at the “dump” of Tustin and Meats for 10 years or so) is certainly more interesting with more soul than the Irvine Spectrum or anything else in South County.
Unfortunately, even the cheap rents in the area can’t keep some of these places going with the economy the way it is.
notice how i said only meats and tustin, not the entire stretch of the avenue.
i live right by that intersection so i know it’s a dump, dood. a rose by any other name is still a rose… just calling a spade a spade. but the real problem here was what started this thread… bliss’ marketing. the sign and the store looked straight outta 1992.
why do you say 1992?
to me it looks like lettering from the 1920’s. at least from the picture; I have not been to the store.
because the lettering, the colors, and the interior of the shop. and especially the lowercase letters. it was hip to use lowercase on everything in the early 1990s.
I’m actually surprised that it’s taken this long for the bubble to burst. I feel sorry for all the shop owners but a word of advice: don’t join a fad that’s already past its peak. Try to at least be a little creative…
I’m amazed people have that much money just sitting around that they need to invest it in this economy. I mean I could find a million better things to do with the money it costs to open a generic Fro-yo shop in this day and age.
granted it’s cheaper to start up than a lot of businesses, and I’m sure that and the fact nobody could get enough froyo was what the big draw was all about (especially if they could get a month-to-month or short term lease with commercial RE in the dumps). but when there’s literally one on every corner in every OC city except Santa Ana or maybe Westminster something is wrong.
you shouldnt be surprised. people took money out of their homes to start their own fro-yo shop
must be nice for them and their family and whatever few friends they have left. unlimited froyo whenever they want it! only $10000 a month!
People tend to use other people’s money to start expensive businesses like these, so those are the ones that get stiffed when operators go belly up. Money was easy to get when times were good, and there were long lines at these places. Even Korean churches loaned out money to build these shops! When operators go belly up, they tend to take all the equipment out in the middle of the night and just disappear, leaving a long list of unpaid bills and no collatteral!
i saw a story about a roach coach (a la kogi’s etc) in l.a. serving breakfast food. a roach coach. mark that as the next fad to burst.
whoa a roach coach serving breakfast? no way! never!
LOL I think I got your point, you’re talking about the new trendy bbq food trucks or whatever. but the comment is funny because roach coaches have been serving breakfast burritos since the beginning of time.
well this one was trendy, frou frou breakfast.
gotcha… yes, that’s pretty funny.
yes, they use twitter to reveal their nightly locations and people line up all hours of the night for the privilege of ordering some scrambled eggs with goat cheese and chorizo.
Aren’t they now serving “gourmet food” and calling them “road stoves”? Change the name and it’s still……….a roach coach serving junkfood. Yeah, I know……….I don’t have to patronize ‘em. And I won’t. No wonder I have to turn sideways to pass someone in Wal-Mart, and it ain’t me who’s blocking the aisle.
true, but something tells me that’s a whole different segment of people. I think they’re all at Hometown Buffet or Denny’s.
I seem to remember this happening with bagels too.
not to mention coffee.
FUNNY did not think it would last
It is so difficult to do business in Orange County with all the bureacracy, fees, taxes, audits, and all kinds of regulations etc. Many small business like us could not survive for the next 2 years.
oh jesus…this is froyo, stop blaming the government for a flawed business plan to begin with.
go to a 3rd world country with no regulations, open a bajillion food carts in one area, and see what happens.
I never did understand the craze over frozen yogurt. I saw this one coming a loooooong time ago.
Went to Pinkberry at the Spectrum only because I received a gift card. The froyoyoyo was so untasty, I threw it out. I’ll stick to Coldstone ice cream. I hope they don’t go away. I need to fatten up anyway so I can block the aisles in Target since I don’t go to WalMart.
Pinkberry is disgusting. I remember it was a year ago, maybe more, they didn’t really have any locations in OC but I found one and was driving through Long Beach anyway, so I went there. I almost threw up. I simply could not believe anyone would eat that, let alone go out of their way for it.
Just another fad….fading away. I wonder what’s next????
yep!
saw this one coming. you dont have to be telekinetic or psychosomatic…whatever the term is…to know that it was coming.
even ‘if’ there werent so many yogurt stores around on every corner…the bubble would still burst, only more slowly. it happened in the past and it will be a trend again.
the real only standing champ will most likely be golden spoon as it has weathered the past bursts and continue on because they seem to have a good business plan. i’ve seen those you dish it, you sprinkle it, they weigh it and you pay it…a lot! yogurt town etc is too expensive. no thanks!
I’ll stick to Baskin-Robbins and Thrifty (Rite Aid) Ice Cream any day of the week. I think frozen yogurt is just a fad and it is just about ending…
The joke before the frozen yogurt oversaturation was that there was a Starbucks INSIDE every Starbucks.
yes, one of my favorites…..
http://www.theonion.com/content/node/29030
reminds me of one of my favorite movie lines from Best of Show - “we met at Starbucks. Well not the same Starbucks, she was at the Starbucks across the street.”
funny, i never realized that new zealand’s had frozen yogurt. to me it was just an ice cream shop. and i’m pretty sure the name of the place was “new zealand natural premium ice cream” so i think you might be wrong about that one.
Hooten: The name is actually New Zealand Natural Ice Cream & Frozen Yogurt, according to the sign that I photographed outside the building. I have made the change.
interesting. i never even realized they had frozen yogurt. went there only once though but i got to that movie theater all the time. i didn’t think the ice cream was very good and that’s why i never went back.
oh and thanks for the quick response! it’s unusual to see such a quick response from a newspaper so it’s nice.
I just hope that Golden Spoon survives because they are IMO the best out there. But I’m starting to notice more froyo shops trying to compete with Pukeberry. I don’t understand the hype over that place. The first time I tried it was the Shoppes in Chino Hillls and seriously I thought I’d gotten a bad batch. It was sour and just disgusting.
ditto, see my comment above (1:25pm)
No worries, Golden Spoon has been through this before and will do it again. Thanks to loyal customers like you, we appreciate your support!
I like Golden Spoon, I was actually saddened when they closed the Bristol & Sunflower location a couple of years ago.
In response to the post below, the franchisee was not able to reach a lease renewal with the landlord at that location. At one time, it was the busiest GS shop! Ice pan, the shop that replaced GS lasted less than a year, and has since been replaced by a new Froyo self-serve. The center has struggled with management issues, frequent turnover, and a high vacancies.
by the way, this isn’t yogurt but did you know that the topz burger joint on katella in orange closed? was surprised to see it closed down the other day. with hollywood video closing that entire section of that mall will be empty.
and…There was a Baja Fresh that closed down in Anaheim Hills and across the street the Blockbuster is closing…………
Got it. Thanks
Saw this one coming when I tried tart yogurt for the first time and thought “Who the hell would pay $3.00 for this crap?” The only survivors out of this craze are probably going to be Yogurtland and Golden Spoon. Golden Spoon has one of the tasiest yogurts in town and gives reasonable prices with friendly service and selection. Yogurtland gives you selection and reasonable prices. Pinkberry has a few flavors and high prices. All the other imitators do the same. This was all just a craze just like cupcakes…
saw this coming. one popping up at every strip mall near me. only the strong will survive
I am very sad to see Bliss go. They had really good yogurt and the best variety of toppings you could ask for. Plus, they were more than a yogurt shop. They had crepes, coffee, and cupcakes.
Like she said, they did have a very loyal following. It was always busy when I went there. I’m surprised she couldn’t make it.
Sad news but of course it had to happen
I predict the next fad will be to have no fad.
For a while at least while the economy is recovering.
Just the usual suspects and long term concepts like elsewhere in the country.
Once the economy picks up, the “latest” food concepts will spring up again, along with their copycats, and start yet another craze.
This process may be cyclical, but at least its entertaining and we get the chance out here to either sample it or critique it first, should the concept grow legs and travel outside CA.
Elsewhere in the country, such as the east coast (Southern) and Midwest, everything is so basic and boring.
after reading this article yesterday and visiting a Froyo shop in my neighborhood for the first time, Le Yogourt in Tustin (Newport Blvd & El Camino Real) I was pretty impressed. they have a special deal their yogurt is 2-for-1, five days a week (M-Th), up to 10oz.
I have been to other mom & pop frozen yogurts around OC and some of them are just terrible. either icy or too sweet, and the toppings are so-so, and sometimes the inside of the store is almost depressing. this one was really good and liked the decor.
I forgot to ask the guy if they have free wireless (I caught a glimpse of his laptop behind the counter). think this would be a nice touch but in I’ll probably go back regardless. hope they stay around.
This is a FAD that will burn very quickly…… you will see more stores closing in the future compare to new stores openings…. In NYC a Red Mango that is stone throw away from a Pinkberry in the Village just closed this month ……. not enough customers for a product which the public is not willing to spend their money ……… just look @ Starbucks, their sales are down for the same reason, people could buy their cup of Joe’s @ DD for 1/2 the cost…….
I think they were about to open a new froyo place around Rockfield in Lake Forest near Captain Cream, if it hasn’t already been opened. I haven’t checked.
I remember the first frozen yogurt craze in the mid 80’s. I tried it once and did not like it. Only real ice cream for me. I guess the difference with this last froyo fad was that most of the places were Korean owned.