Scoring an ice cream shop market on seven factors, not a list of towns

What to take away

Market and site are different questions

The site question is about a doorway: what passes it, at what hour, and what the building can carry. The market question is about the whole town: whether there is a business here at all.

A perfect site in a market with a nine-week season and no winter residents is a nine-week business. A mediocre site in a market with year-round residents and evening street life can be a career. Answer the market question first, then run the site work.

The seven factors

1. Season length. How many weeks a year are warm enough and dry enough that people buy ice cream outdoors in the evening. This sets the ceiling on everything.

How to measure: published climate normals for the location, plus a conversation with two local businesses about when their trade starts and stops.

2. Winter population. Whether anyone lives here when the visitors leave. A resort with a small permanent population has almost no winter trade at any price.

How to measure: public census and local government data on resident population, compared with peak visitor estimates the local tourism body publishes.

3. Evening street life. Whether people are out, on foot, without anywhere to be, after dinner in the warm months. This is the single strongest predictor and it cannot be looked up.

How to measure: stand in the main pedestrian streets at eight in the evening on a warm weekend and count. Then again on a cold weekday.

4. Competition depth and quality. Not how many shops, but how good they are and what they leave uncovered. A market with three excellent shops may still have no maker of dense, made-on-site product.

How to measure: visit every one of them and score them honestly.

5. Occupancy cost against the season. Rent is charged for twelve months and earned in a few. A market where rents are set by year-round retail economics is expensive for a seasonal trade.

How to measure: commercial listings for comparable units, and ask agents what a unit like yours actually leased for.

6. Labor availability. Whether you can hire and keep a seasonal crew, and whether they can get home after a late close. Resort markets are often short of workers and short of anywhere for them to live.

How to measure: look at what other hospitality employers are advertising and for how long the postings stay up.

7. Regulatory reality. What a retail food business must have here, whether making product on site changes the class, and how long the process takes. The U.S. Food and Drug Administration: State Retail and Food Service Codes and Regulations directory names the agency for each state, and outside the United States the national or municipal food authority is the equivalent.

How to measure: call the agency and ask about timescales before you commit to anything, using the licensing questions this trade raises.

The scorecard

Two rows disqualify: evening street life and labor availability. A market with nobody out in the evening cannot be fixed by a better shop, and a market where you cannot staff the counter cannot be traded at all. Everything else is a matter of degree and price.

Note what is not a disqualifier: competition. A market with good shops is a market with a proven appetite, which is more useful than an empty one.

The interaction nobody prices

Season length and occupancy cost multiply. A market with a long season and moderate rent and a market with a short season and cheap rent can produce the same answer, and a market with a short season and high rent produces no answer at all. Work them together rather than separately.

Labor deserves the same treatment. In markets where housing is expensive and seasonal, wage costs run higher because that is what it takes to hire anyone, and the way to check that is by looking at what employers there actually advertise rather than at any national figure, as set out in how to arrive at a defensible rate.

If the market would need a manager rather than only servers, price that separately. The U.S. Bureau of Labor Statistics: Food Service Managers profile describes what the role covers and publishes national pay data by area, which is a reasonable starting reference for a market you have never traded in, though the local postings remain the better guide.

Market types and what each one asks of you

Resort and beach. Intense, short, high rent, hard staffing, no winter. Suits an operator who can close and who has somewhere else to be.

Tourist old town with residents. The best of both, and usually the most expensive. Two customer bases with different hours.

City neighborhood. Modest peak, real winter, regulars, take-home. The market for a maker building something over years.

Small town. Small in every direction. Can work beautifully with low occupancy cost and a winter line, and it lives or dies on whether the street has any evening life.

College town. Its season runs backward: quiet in summer, busy in term. Excellent if you plan for it, ruinous if you assume a normal year.

Match the type to what you can actually run. A resort market rewards a shop that closes for months and staffs up fast, which is a demanding annual recruitment and training cycle rather than a lifestyle.

Doing the work

Two visits, minimum: one in season and one out of it. Count in the evening. Talk to businesses that are not competitors. Read the local government's published data on population and on any development planned nearby.

For the general market research a lender or a landlord expects to see written up, the U.S. Small Business Administration: SBA Business Guide sets out what that document usually contains. It will not tell you about the season, which is why the counting above cannot be skipped.

If you are looking at a market for a second shop rather than a first, add one question: can this be run without you being there most days? That is the constraint that decides most second sites, and it sits with the wider routes out of a single counter rather than with the market itself.

Common questions

Which country or region is best?

None, in the abstract. The factors above apply everywhere and produce different answers in neighboring towns, let alone neighboring countries.

Is a warmer climate always better?

Not necessarily. A very hot climate can push people indoors in the middle of the day and shift trade to late evening, and a mild one with a long shoulder season can trade more weeks than a hot one with a short intense peak. Count the weeks people are actually out.

Should I open where there is no competition?

Find out why there is none. Sometimes it is an opportunity and sometimes three people have already tried. Ask the businesses that have been on the street longest.

How long should this take?

Two days per market, done properly, spread across two seasons. It is the cheapest research in this trade and the most often skipped in favor of a spreadsheet.

What if the market is good and every site in it is bad?

Wait, or take a compromise site with a break clause. The market decision has a long life; a bad lease has a fixed term and no exit, and the way to assess one is set out in how a shop is presented and grown once it is trading.