The Sweet Story of Ben & Jerry’s
from CNN Money 11 Apr 13 enhanced by Peter/CXO Wiz4biz
Fat Chance. Ben Cohen and Jerry Greenfield met in Junior High School in Merrick, N.Y., running around the track during gym class. “We were the two slowest & fattest kids in the class,” Greenfield says. A few years after graduating from HS, Greenfield struggled to get into medical school, and Cohen (after “dropping out of a lot of colleges”) failed to make a living as a potter in upstate New York. “We were flailing,” says Cohen. “We said, Man, we’re not getting anywhere in the world. Maybe if we started our own business we would be able to make it.”
What can we do? They both liked to eat, so they decided to open a restaurant. A friend warned them about all the challenges of a full-service dining operation, so they settled on the idea of an Ice Cream shop. Ben & Jerry looked for a rural college town that didn’t have an Ice Cream Parlor that made its own ice cream. [Location, Location. That isn’t being served]
Funding. They each put up $4,000 and got a $4,000 loan from the bank to open their first “scoop” shop in Burlington, Vt., in 1978. The store also served Crepes because the bank required they reduce the seasonality of the business. When they couldn’t move enough ice cream in the winter, they sold to local restaurants and Mom-&-Pop grocery stores.
Playing their best Roles got them on a roll. Ben was the front man — the salesman & flavor creator — while Jerry worked on making the ice cream. Neither had any desire to do what the other one was doing. “Ben is really entrepreneurial & creative (out of the box), and I do well within the box, as they say,” Jerry explains.
Compatibility. They got along on most everything. “Our basic agreement was that the person who felt more strongly about the particular issue got their way,” Jerry says. One memorable disagreement came over the size of chunks in their ice cream. Ben wanted bigger; Jerry wanted smaller, and more of them — it was easier to produce, he said. Jerry didn’t like big chunks because they clogged the filler head on the ice cream machine, and he had to first sanitize his arm and then stick it down through the ice cream and clear the clog. Nevertheless, big chunks won out and probably helped lead to their success as the expanded across America.
Buyout. In 2000, Unilever bought Ben & Jerry’s for $326 million – pretty good for a $12,000 Investment. Today the business is part of its $9.75 billion refreshment arm. Ben & Jerry are still full-time employees, but they aren’t involved in day-to-day management or operations. Just having fun making new exotic flavors of Ice Cream.
Comments: What lessons have you learned from this story? What do you think of their operation when you visited it?