This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
TheStreet Open House

16 Handles Aims to Win in Frozen Yogurt Consolidation

NEW YORK ( TheStreet) - Up and coming frozen yogurt chain, 16 Handles believes that it has what it takes to be successful in the crowded industry.

Founder and CEO Solomon Choi opened the first store in Manhattan's trendy East Village in 2008. It now has 37 locations across six states through franchising. It plans to more than double that amount by the end of 2014.

16 Handles has some big shoes to fill though. Frozen yogurt sales topped $760 million in 2012 with TCBY, Red Mango and Pinkberry controlling half of the industry, according to IBISWorld.

IBISWorld forecasts that while industry will see 4.2% growth in revenue over the five years between 2012 and 2017, margins are eroding, given the rising cost of milk, consumers' finicky preferences and competition.

Choi is optimistic about the company's prospects. He says 16 Handles was actually the first store to implement the popular self-serve model whereby customers create their own frozen dessert by pulling the "handle" of one of the store's 16 daily flavors. Self-serve models now make up the largest segment of frozen yogurt stores (at just under 40%).

video platformvideo managementvideo solutionsvideo player

16 Handles welcomed TheStreet to its Murray Hill location (which ironically had a Tasti D-Lite down the street) for our weekly Test Kitchen.

An edited transcript of the conversation follows.

With 37 stores now, what are the plans for growth?

Choi: The plan for growth is we'd like to be at a 100 stores by end of next year and at 150 stores by 2015 and also in a couple different countries at that point.

Let's talk about that self-serve model. It's one of the big parts of the resurgence of frozen yogurt. Why do customers love it?

Choi: I think people love it because of the personalization and the customization factor. We all have our different needs and our wants, whether they be dietary restrictions, whether they be satisfying a different type of sweet tooth, so I think having 16 different rotating flavors along with 50-some odd toppings, the combinations are endless depending on one's mood. Maybe I came from a workout and I want to treat myself or I'm really watching my weight and so I want to have something healthier -- people like to be in control of what they intake.

1 of 2

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 16,987.51 -61.49 -0.36%
S&P 500 1,985.54 -11.91 -0.60%
NASDAQ 4,567.5980 -24.2080 -0.53%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs