Few foodservice companies have the history and continuity as Graeter’s. The Cincinnati-based ice cream chain was founded in 1870 by Louis Charles Graeter and is now run by third, fourth, and fifth generation family members. Chip Graeter (fourth generation) oversees retail operations and spends time in one of the chain’s 56 locations every single day.
He also keeps an eye open for potential new locations, primarily in Graeter’s existing markets in the Midwest that include Columbus, Cincinnati, Louisville, Indianapolis, Chicago, and Pittsburgh During a recent interview, Graeter said there is “plenty of room to go,” and if the right location came along, the company would consider it. A new store is opening soon in Indianapolis, for instance. Still, while there may be opportunity – the company’s sales have grown by nearly 13% throughout the past two years, according to Technomic data – there is certainly no urgency.
“Low and slow. We’re in no hurry,” he said. “We’ve made plenty of mistakes over the years putting the wrong store in the wrong place.”
Graeter adds that he is hesitant to get too far away from the company’s core markets, though he does like the idea of expanding to Nashville and, eventually, Naples, Florida. For now, however, the company is making sure it’s doing everything right in its current stores before getting too far out.
“We’re happy to be a strong Midwestern company,” he said. “We’re a conservative company that doesn’t like to get beyond our skis too much – spending too much money on this or that. We make sure we’re doing things smart and protecting the business. We have an obligation to take care of that.”
That’s where the “low and slow” strategy comes into play. In fact, Graeter’s didn’t really think about growing outside of its dozen or so locations in Cincinnati until about 2010, when the company built a new factory to support growth. Even with that added infrastructure, however, the company has maintained the integrity of its products. To this day, Graeter’s continues to make its ice cream via a French Pot process, in which all ingredients are combined in French pots and spun in a saltwater brine for a more dense, creamier product.
“My great grandmother made ice cream with this method and when all the new refrigeration and ways to make ice cream came along in the ‘30s and ‘40s, we stuck with the French pot,” Graeter said. “To most people, we were crazy. It’s a very labor-intensive process. We stuck with it because we think it makes the best product. Making it this way and doing it how we’ve done it has gotten us to 154 years.”
He adds that it also differentiates the company from other ice cream concepts, many of which are growing at a much faster clip. The production process isn’t the only unique attribute, however. Graeter’s is famous for its chocolate chips; liquid chocolate is poured into the pot, so it freezes along the side and then gets broken into chocolate chunks. Flavor innovation has long been a priority for the chain as well, and shops continue to introduce new flavors every two or three weeks to keep guests interested and engaged.
That said, Graeter’s has modernized some parts of the business, including front-end improvements to yield larger batches. Higher yields are necessary as the company has grown a major retail business throughout the country in partnership with companies like Kroger and Walmart. The company has also focused more on its marketing presence and created a mystery box this year where customers who have Graeter’s ice cream shipped to them can guess the flavor. Shipping has been an important channel for the brand since the early 2000s, when Oprah endorsed the product.
“The business shot off like crazy,” Graeter said about the endorsement. More potential remains here, however, and Graeter’s recently opened a new facility in Louisville to support the channel. Now, with its ramped up retail and shipping channels alongside slow and steady brick-and-mortar growth, Graeter’s plans to grow its team and bring the next generation on board.
“It’s time,” Graeter said. “One thing we’ve done is hire incredible people to do incredible jobs and develop our teams, systems, processes. I’m excited for the next generation because they’re coming on in a much better way.
“We want to preserve the past and our core, but we also look to the future and what the guest might want.”
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Contact Alica Kelso at [email protected]
