Get The Scoop On Running A Successful Ice Cream Business – 5 tips for increasing profit margins

Potentially high profit margins and low start-up costs make running an ice cream business a tempting proposition. From regulations and getting an ice cream van permit to sourcing insurance, follow our top five tips to run a successful ice cream business:

 

1) Make sure all the legal stuff is in place

We bet you’re full of great ideas to make money by selling ice creams. But even the best ideas will fail if you don’t have the essential legal bits in place first. So, before you set off on your rounds, you’ll need to make sure you meet all the regulations for selling ice cream. That means:

  • Undergoing the appropriate food hygiene training.
  • Getting the right street trading licence from your local council.
  • Making sure you meet all your legal obligations with the right insurance.

Food hygiene regulations

Forget about advertising, stock choice, and location. When it comes to running a successful ice cream business, your number one concern is protecting the general public. If you sell ice cream from a van, bicycle, boat, or anywhere else, you’ll need to comply with food hygiene regulations. They are in place to make sure that every ice cream (or any other food item) you sell is safe to eat. And they outline the strict approach to food handling and preparation that you and any staff will need to follow every day.

Food hygiene regulations are set to protect consumers from food risks including food poisoning and allergic reactions. The Food Standards Agency offers clear guidelines for businesses to help you run your premises, including mobile ice cream vans, in a safe and hygienic way.

 

Food hygiene certificates

If you are responsible for your business’s food safety management procedure, by law you have to complete training on food safety and hygiene.

In the UK, food handlers don’t have to hold a food hygiene certificate to prepare or sell food.

You should get in touch with your local council to find out about training and food hygiene courses. To find the contact for your local council, search here.

Food hygiene and labelling requirements

The food you sell must not be harmful to people’s health. In extreme cases, food poisoning can result in death. Read this regulation on food safety and this regulation on food hygiene.

In extreme cases, an allergic reaction to an ingredient, such as nuts, can cause death. Your customers need to be able to make informed and safe choices about the food they are about to eat. Read this regulation on safe labelling and information.

Registering your business

If you’re just setting up your ice cream business, you’ll need to register your business. You need to do this at least 28 days before you start trading. It’s free and you can register online here.

Do you need a licence to sell ice cream?

Different councils have different rules, and some will require you to take out a street trading licence. Some will not allow roadside trading at all but will agree to specific pitches where you won’t cause an obstruction to traffic or pedestrians. If you’re setting up a new business and your council won’t allocate any new pitches, you may have to buy an existing business or pitch. Remember that sometimes licences are not transferable, so double check first before you spend any money.

Another alternative is to set up your pitch on private land, such as a car park outside a business. You’ll need to get permission from the owner of the land before you do this. Some councils will allow you to sell from private land without a licence if you are a certain distance from the highway. Others may still insist on a street trading licence. The best thing to do is to speak to your local council for advice.

To find the contact for your local council, search here.

 

Can ice cream vans sell products anywhere?

Generally, you can’t just sell ice cream wherever you like. If you have a licence, check the conditions to see if there are restrictions. Also be aware that some councils ban ice cream vans from trading in certain places, such as close to schools or playgrounds.

Selling ice cream from a bicycle

It’s becoming increasingly popular to sell ice cream from a bike. To do this, you’ll need to follow the same rules as for an ice cream van.

If you’re selling ice cream from your home or another venue, you may need a street trading or roadside trading licence. Your local council can help. To find the contact for your local council search here.

2) Choose your pitch

Whether you have a traditional ice cream van, a cart, a bike or a stall, choosing the right pitch can make a serious difference to the profits you can expect to make. Consider likely footfall as well as whether there are many competitors also selling their wares nearby.

Don’t forget the regulations and rules outlined by DEFRA on when and how you can sound your chimes. Key rules on chimes include:

  • Chimes cannot be played more than once every two hours in any one stretch of street.
  • Chimes cannot be louder than 80 decibels.
  • Your music should not last more than 12 seconds.
  • Chimes should not be played in sight of any other van.
  • Chimes can be played only once on the approach to a stopping/selling point and only once whilst stationary.
  • There must be an interval of at least two minutes between the chimes being played.
  • Chimes cannot be sounded within 50m of a hospital or 50m of a school during school hours. You cannot sound chimes within 50m of a church or place of worship on a Sunday.

Read the full Code of Practice.

3) Decide on your stock for bigger profits

Will you stick to traditional favourites like the 99? Or are you looking to sell homemade, artisan products and unusual flavour combinations? Whatever you choose, it’s important to think about the product range you’re going to offer and if people will buy it.

If you’re operating from a van, bike or stall, you’ll only have limited space for stock, so you need to find out which items sell well. Also, think about if there is anything different that you could offer that would make your business stand out from your competitors? And are there any extras that you could stock, like hot dogs or burgers, which could help you to boost profits?

Did you know?

Did you know that Dragon’s Den millionaire Duncan Bannatyne started his career with an ice cream pitch? One of the ways he made it a success was by investing in a special ice cream scoop. This not only meant he could serve his customers faster, it also left a unique smile shape on the top of the ice cream. As well as speeding up the number of covers per hour, it also made his ice creams a little different, so he could charge more.

4) Have a bad weather back up plan to protect your business

Bad weather can seriously affect ice cream sales. Make sure you have a back-up plan if the summer season ends up as a wash-out. Diversifying your range is one option – you could also consider serving hot drinks and snacks as well as ices.

5) Buy cheap insurance for your ice cream business to reduce outgoings

Shopping around for the best value deal on your insurance can help your business to become more profitable. The cheapest options are not always the best, so look out for exclusions in the small print that could cost you big if you do need to make a claim, or ask a broker with experience in ice cream business insurance for help.

 

Areas of insurance for you to consider:

Public liability insurance

This pays your legal fees and any compensation awarded if a member of the public sues you for injury or damage caused by your business. That includes claims for food poisoning and allergic reactions due to incorrectly labelled food.

Employers liability insurance

This is a legal requirement if you employ any member of staff, even if they work part-time or are family members. It pays your legal fees and any compensation claims brought against your business by a member of staff.

Van/vehicle insurance

You need this to legally drive your ice cream van on the road. Specialist commercial vehicle insurance for ice cream vans will also cover the expensive specialist equipment in your van, like freezers and your chimes. You might also want to include breakdown insurance as part of your package for added peace of mind that if your van won’t start, it can be quickly towed to be fixed with minimum hassle.

Commercial property insurance

You’ll need this if you operate your ice cream business from a property, even if it is also your home.

Stock cover

Stock cover gives you extra peace of mind that you won’t be left with a cash flow problem if all your stock becomes damaged, for example, if a power cut results in all your ice cream melting.

Money cover

The majority of your sales are likely to be paid for in cash. At the end of a busy day, you could be driving around with a significant amount of money. That makes you a target for thieves. Money cover is the insurance option that gives you financial peace of mind. It will cover your money in your place of work (your business premises, including a mobile van if that’s where you sell from), and en route to the bank too.

Personal injury insurance

If you rely on your income from your ice cream sales to pay the bills, have you stopped to think about what would happen if you can’t get out on the road? Personal injury insurance pays out if you have an accident and you can’t work for a period of time. It means you can still pay the bills until you’re back on your feet again.

Ice cream van rules and regulations checklist:

Have you registered your mobile ice cream business with your local council?

You need to register at least 28 days before you start to trade, so if you haven’t already, do this now. Registration is free but you’ll need to give details of your business, including the address and where you’ll be preparing or selling ice cream. To find the contact for your local council, search here.

Will you be opening late?

After-hours trading laws apply to ice cream sellers, so you’ll need an entertainment licence.

Have you written down your food safety management system?

If not, follow this guide.

Have you got public liability insurance cover?

Contact our specialist team at Park Insurance.

Are you employing staff to help you?

If so, you’ll need employer’s liability insurance by law. It’s worth remembering that you need this even if the staff you employ work part-time. If you don’t have it, you can be fined. The only potential exception is if it is a family business and you only employ close family members. Contact our specialist team at Park Insurance for more information.

Are you going to be using a mobile ice cream van?

If so, you’ll need specialist vehicle insurance. Remember, you’ll need to cover any specialist equipment inside as well as your stock. Otherwise, you could be left out of pocket if an accident or theft occurs. Contact our specialist team at Park Insurance.

Are you setting up your ice cream business for the first time?

If you are, and you will be self-employed, you’ll need to notify HMRC within three months of starting. Mark the deadline on your calendar, or even better, do it today.

Are you setting yourself up as self-employed?

If you’re setting yourself up as self-employed, you’ll need to let the National Insurance contributions office at HMRC know.

What is your predicted annual turnover?

If it exceeds the VAT registration threshold of £85,000 you’ll need to register with HMRC.

Trust Park Insurance to help you make a cool profit

Park Insurance is an independent, family-run business with over 30 years of specialist experience. We help catering and ice-cream businesses to find the right insurance at the best possible price.

We source reliable insurance cover from some of the UK’s largest insurance companies. Policies are tailored specifically to your needs so you can be confident you’re protected without paying for anything you don’t need. Call our friendly team on 0117 955 6835 or get in touch.