{image1}The Milwaukee ice cream market, already crowded with competitors wanting to dish out their favorite flavors, is getting a new national competitor hoping to grab a large scoop of business.

Cold Stone Creamery, based in Scottsdale, Ariz., recently opened its first two stores in the Milwaukee area, at the Ruby Isle Shopping Center in Brookfield and the RiverPointe Shopping Center in Fox Point. New stores are slated to open in the next several weeks at Mayfair Mall in Wauwatosa, as part of new shopping centers near Highway 83 and Interstate 94 in the City of Delafield, and near Highway 41 across from the Tinseltown Theater in Kenosha.

Additional stores are planned for Janesville, Appleton and two in Madison, including one on State Street, aimed at attracting hungry University of Wisconsin students. The company will announce next week plans to award 10 new franchises in Wisconsin in 2003 and 2004.

In all, the company wants to have 30 stores in Wisconsin within the next five years. And retail sources said Cold Stone representatives are also considering a store in downtown Milwaukee, where many feel there is a need for ice cream retail outlets. Company officials have confirmed they are negotiating to locate a store as part of the development of PabstCity on the former Pabst Brewing Co. complex near North 6th Street and West Juneau Avenue.

The company is ready to take on Kopp's Frozen Custard and Leon's, two well-known local retailers that currently dominate Milwaukee's mental real estate when it comes to frozen treats.

"We want to have a major impact on Milwaukee and Wisconsin," said Dale Johnson, a real estate representative for the company. "So far, our numbers are good in the Milwaukee area and as people get to know our name and try our product, we believe our numbers are only going to get better."

The operator of the popular Kopp's Frozen Custard restaurants in Milwaukee said there already are enough ice cream outlets in the Milwaukee area with the growing Culver's Restaurant chain, along with the smaller ice cream shops that have opened throughout the area."

"I don't know how much more room there is in this market," said Bud Reinhart, general manager of the Kopp's in Glendale and Greenfield. "It is getting to be a tougher market. There is no doubt that people in Milwaukee like their ice cream and custard, but there is always a limit."

Cold Stone Creamery, an independently owned franchise system, was developed in 1988 to offer combinations of customized ice cream creations. Matt and Lisa Gangl operate the franchise at RiverPointe and Jay Miller operates the franchise in Brookfield.

With more than 390 stores operating in 36 states and the Caribbean, Cold Stone Creamery plans to establish 1,000 stores by 2004. Its real estate team has already fully executed 169 leases in 2003, with another 70 leases currently in various stages of negotiation. It plans to open 300 stores in 2003 and another 450 stores in 2004.

"Cold Stone Creamery's growth across the nation has been incredible," Johnson said. "With a weak labor market and sluggish economy, people are looking for creative entrepreneurial opportunities. What better business to be in than the ice cream business? The demand for our fresh-made ice cream can only be matched by the demand for the superior small business opportunity and franchise support system we've established."

Kevin Donnellan, communications manager for Cold Stone, said it is their goal to be "the second best thing in Milwaukee next to beer."

"We have a very unique product that attracts people who really like ice cream," he said. "We are a lot like a micro-brewery and aim for a more sophisticated palate. It is much different than the hard pack ice cream you find at other stores."

The uniqueness of the product is that the ice cream is homemade and mixed up right in the store on a frozen granite stone. Donnellan said it allows them to offer flavors that other ice cream retailers can't.

The only place that prepares a similar ice cream in the Milwaukee area is Ferch's Malt Shoppe in downtown Greendale, where workers have been preparing combinations of ice cream on a granite stone since 1999, said Betty Ferchoff, the owner of the store.

"It has been very popular because people can make up any flavor they want," said Ferchoff, who started the store in 1987. "We are not fast food. We interact with the customer and put on a show for them. Coming to our store is a unique experience."

Ferchoff said she is not worried about the increasing competition from Cold Stone Creamery.

"I am not very impressed by them," she said. "I tried their product when I was out west and it wasn't that good and it was very pricey for the amount they gave you."

Plus, her store has more offering than just ice cream, with a full menu and soda jerk and 1950s look. The same goes for Kopp's, which offers hamburgers and other food at its three Milwaukee-area restaurants.

"There is no place like us in Milwaukee," Ferchoff said. "We've had national competitors come in here before like TCBY (Yogurt) and what happened to them. How many of their stores are left here nowadays?"

Added Reinhart, "These national people go in and out of the market all of the time. I really don't think they are going to have too much of an impact because people in Milwaukee like to stay with what they are used to."

Ferchoff and Reinhart predicted that Cold Stone Creamery will struggle during the cold Wisconsin winters when temperatures drop below zero and the snow flies. Ferchoff said her ice cream sales drop by as much as 50 percent during the winter months.

"It always surprises me how someone can stand outside when it is 10 degrees below zero, licking an ice cream cone," Reinhart said. "But I love them because they are helping my business."

But Donnellan said the company has stores in many cold weather locations, including Eagle River, Alaska, Maple Grove, Minn. and Bismarck, N.D., and all of them do well all year round.

"Ice cream is really built into our social conscious and it is, for the most part, recession proof and weather proof," he said. "We believe that we can be successful in any market because people will like our product."