How profitable is an ice cream shop? That is the question many aspiring entrepreneurs ask when considering breaking into one of America’s most beloved indulgences.
The United States ice cream industry is massive, with annual sales exceeding 13 billion dollars, according to IBISWorld. Americans consume nearly 20 pounds of ice cream per person each year, based on USDA data.
While legacy brands dominate supermarket shelves, the real buzz is happening at the boutique level. Small-batch parlours and artisan scoop shops are reshaping the industry, turning scoops into serious revenue.
This guide will help you unpack everything you need to know about running a financially successful ice cream business. You will get a clear picture of revenue streams, startup and ongoing expenses, the challenges owners face, and the strategies that top performers use to grow and thrive.
Maybe you are just exploring the idea or already own a scoop shop, this guide will equip you with insights to make smarter, more profitable decisions. Along the way, we will also point you to practical tools like our paid business plan template and resources that can help bring your vision to life, like the Entrepreneurs Success Blueprint Program.
Key Takeaway
- Long-term success depends on smart planning, customer experience, off-season strategies, and the use of tools that optimise efficiency and sales.
- Ice cream shops in the US can achieve profit margins of 15 to 25 per cent when managed with the right pricing, operations, and product mix.
- The most profitable ice cream businesses diversify revenue through premium items, seasonal offers, catering, and branded merchandise.
- Controlling costs, especially labour, ingredients, and rent is essential to maintain healthy ice cream business margins year-round.
See also: Proven steps to start a successful business
How Profitable Is an Ice Cream Shop?
The profitability of an ice cream shop in the United States can be impressive when the business is set up and run with a strategy.
Ice cream shops often operate with strong gross margins, and net profit margins typically fall between 15 to 25 per cent, depending on factors like location, overhead costs, and product mix.
For entrepreneurs asking how profitable an ice cream shop is, the answer lies in understanding both the opportunity and the variables that affect returns.
On average, a small to mid-sized scoop shop in the US can generate between 200,000 to 500,000 dollars in annual revenue, with high-performing shops crossing the 1 million dollar mark.
A modest shop serving 100 customers a day at an average ticket size of 5 dollars could make 182,500 dollars in sales annually, even without factoring in seasonal peaks.
Larger operations in high-traffic areas, especially those offering premium menu items and catering services, can double or triple those figures.
Still, not every ice cream business achieves its potential. Profitability is shaped by factors such as product pricing, labour management, rent, and the ability to operate efficiently. Shops located in busy pedestrian zones or near schools and tourist attractions tend to perform better.
Likewise, those that optimise portion control, manage staff scheduling, and implement strong marketing practices tend to see higher returns.
Compared to other food-based ventures, ice cream businesses enjoy lower food waste and easier inventory management, making them particularly appealing to first-time business owners.
If you are mapping out your entry into the dessert space or already running a scoop shop, our Entrepreneurs Success Blueprint and detailed business plan template can guide your decisions. These tools provide practical financial forecasting models and revenue planning tailored to the US market.
How Much Does an Ice Cream Shop Make?
Understanding how much an ice cream shop makes starts with a simple formula: daily foot traffic multiplied by the average spend per customer.
While the numbers vary widely based on location, shop size, and offerings, most independent ice cream businesses in the US generate between 200,000 and 700,000 dollars in annual revenue.
Well-established shops in high-demand areas can reach seven figures, especially those that diversify their income through catering, online orders, and seasonal promotions.
Let us look at a few examples. A small neighbourhood shop serving around 80 customers daily with an average spend of 6 dollars would generate approximately 175,000 dollars in annual revenue.
A mid-sized parlour in a busy district attracting 200 daily customers with an 8 dollar ticket size could bring in well over 500,000 dollars per year.
Premium locations with strong branding and value-added offerings like milkshakes, floats, and toppings often push well past those numbers.
The average income of an ice cream shop is also shaped by how well it manages its costs. Shops that control ingredient usage, reduce waste, and maintain consistent customer volume tend to perform more predictably month to month.
Summer months, in particular, offer a major revenue boost, with some shops generating 60 per cent of their annual income between May and September. That is why off-season planning and diversified product lines are key to consistent profitability.
To make informed projections, consider downloading our paid business plan template from the Entrepreneurs.ng shop.
Key Revenue Streams in an Ice Cream Shop
A profitable ice cream business does not rely solely on scoop sales. Successful shops maximise earnings by introducing multiple income streams that boost the average ticket size and extend revenue beyond the walk-in counter.
These revenue channels also help build resilience during off-peak seasons and increase long-term customer value.
Scoops, Cones, and Cups
Standard scoop sales remain the backbone of most ice cream shops. Single, double, and triple scoops served in classic or waffle cones, as well as cups, drive daily traffic.
Offering different portion sizes gives customers flexibility while allowing you to optimise pricing and portion control for better profit margins.
Premium and Specialty Items
Milkshakes, ice cream floats, sundaes, and ice cream sandwiches are powerful upselling tools. These items often deliver higher profit margins than basic scoops, thanks to their perceived value and minimal added ingredient costs.
Some shops also introduce creative dessert pairings, such as waffles and cookies, to keep menus fresh and engaging.
Toppings and Add-ons
Offering a variety of toppings like sprinkles, sauces, nuts, and fruit can significantly increase each order’s value. Add-ons are high-margin, easy to prepare, and encourage customisation, especially for younger customers.
Creating “build your own” options can boost engagement and encourage larger purchases.
Seasonal Specials and Limited-Time Offers
Introducing seasonal flavours and limited-time promotions helps maintain excitement around your brand. Flavours themed around holidays or local events create urgency and encourage repeat visits.
Seasonal ice cream sales tend to peak in the warmer months, but with the right promotions, you can extend customer interest year-round.
Catering, Delivery, and Events
Revenue does not need to end at your counter. Catering for birthday parties, corporate events, and school functions can provide a consistent and lucrative income stream.
Many shops also list their products on delivery apps like Uber Eats or DoorDash, especially during summer or peak tourist seasons. These channels increase visibility and attract a wider customer base.
Branded Merchandise and Take-Home Options
Selling branded items like t-shirts, mugs, or pre-packaged ice cream tubs offers another revenue stream that builds brand loyalty.
Offering take-home pints or quart-sized options is an effective way to reach customers who prefer to enjoy your product at home or during cooler months when foot traffic slows.
Typical Expenses for Ice Cream Shops
Understanding your costs is just as important as estimating your income. Even with strong sales, profitability depends on how well you manage your expenses.
Ice cream shop costs can be broken down into two main categories: startup costs and ongoing operating expenses.
Startup Costs
Before you open the doors, there are upfront investments required to set up your business. These typically include:
Equipment
Freezers, soft-serve machines, dipping cabinets, blenders, refrigerators, and display units are essential. Equipment costs can range from 10,000 to 50,000 dollars, depending on whether you purchase new or used, and whether your shop includes kitchen prep space.
Licences and Permits
You will need to budget for health permits, food handler certifications, and business registration fees, which vary by state. These may total between 500 and 2,000 dollars. It is also smart to factor in legal and accounting services during the setup phase.
Renovation and Interior Design
Creating a welcoming, branded environment can significantly influence customer experience. Whether you are leasing a blank space or renovating an existing one, expect to spend 5,000 to 30,000 dollars, depending on size and style.
Branding and Marketing Assets
Logo design, signage, packaging, uniforms, and social media setup are all part of building a recognisable presence. For professional support, consider our logo and brand identity packages in the Entrepreneurs.ng shop to ensure a strong launch.
Ongoing Operating Costs
Once you are up and running, monthly expenses begin to stack up. Here are the most common:
Ingredients
Dairy, sugar, flavourings, cones, and toppings make up the core of your product costs. These should ideally stay below 25 to 30 percent of your revenue. Sourcing in bulk and managing waste helps protect your margins.
Labour
Employee wages, benefits, and payroll taxes are a significant expense. According to the Bureau of Labor Statistics, food service workers in the US earn an average hourly wage of around 14 dollars. Staffing needs vary with foot traffic and seasonality, so using scheduling software like 7Shifts or Homebase can help balance coverage and cost.
Rent and Utilities
Retail rents vary dramatically by region. A high-traffic urban location could cost 5,000 dollars per month or more, while suburban or rural spots may fall below 2,000.
Utility bills also fluctuate with freezer use and air conditioning demands, especially during summer months.
Marketing
Ongoing marketing is key to maintaining foot traffic. Allocate budget for local promotions, Google Ads, and social media content.
Customer loyalty tools like Fivestars or email campaigns can drive repeat visits.
Tech and Payment Systems
POS systems like Square, Clover, or Toast streamline checkout, manage inventory, and track sales performance. Most shops also incur monthly software fees for scheduling, loyalty, or delivery integrations.
Insurance, Cleaning, and Compliance
Food businesses must maintain hygiene standards and liability coverage. This includes general business insurance, equipment coverage, cleaning supplies, and compliance materials. Skimping here can lead to costly health violations or damage claims.
Keeping these costs under control is one of the best ways to increase your profit margins. For a clearer picture of what your startup and monthly budgets might look like, use a business plan.
Profitability Drivers in Ice Cream Shops
Profitability in ice cream shops is rarely an accident. It is the result of deliberate planning, efficient operations, and consistent customer value.
While high foot traffic and strong branding can help, long-term success depends on how well you manage the details behind the counter. Here are the main drivers that determine how profitable an ice cream shop can be.
Effective Ice Cream Pricing Strategy
Smart pricing is a foundational part of profitability. Many ice cream businesses underprice their products in an effort to attract customers, but this often eats into margins.
Instead, use a tiered pricing model that reflects portion sizes and ingredient quality. Premium flavours or artisan batches can command higher prices, especially when paired with premium cones or toppings.
Bundled deals and family combos can also increase spend per visit while providing value to your customers. If your average order size increases from 5 dollars to 8 dollars, and you serve 100 customers a day, that difference adds up to 1,500 dollars in extra revenue each week.
Controlling Costs Without Cutting Corners
Managing operating expenses is one of the best ways to improve ice cream business margins. Start with portion control. By training staff to scoop consistently and avoid over-serving, you reduce waste and maintain predictable food costs.
Buying ingredients in bulk, batching production, and scheduling staff efficiently are also key. Tools like inventory tracking software and time-clock apps help you stay on top of supply levels and labour costs without constant manual oversight.
Maximising Revenue with High-Margin Add-ons
Toppings, sauces, and waffle cones are inexpensive to source and easy to upsell. By encouraging customers to personalise their orders, you increase the average ticket size while maintaining a high profit margin. Seasonal toppings or limited-time creations also create urgency and boost short-term sales.
Consider adding merchandise, take-home pints, or party packages to your menu. These extensions increase the number of ways customers can interact with your business and allow you to generate income beyond your store hours.
Using Data to Drive Profitability
The most profitable ice cream shops are data-driven. Point-of-sale reports help you identify your best-selling products, slow days, and top-performing staff. With this insight, you can adjust staffing, run targeted promotions, and make informed menu changes.
Even small tweaks, such as removing low-selling flavours or adjusting hours based on traffic, can have a noticeable impact on your bottom line.
How To Increase Profitability of Your Ice Cream Shop
Running a successful ice cream business is not just about scooping and serving. The most profitable shops are strategic about every aspect of the operation, from the menu and marketing to staffing and customer retention.
If you are looking to grow your ice cream business revenue and strengthen your margins, these proven methods will help you do just that.
Optimise Your Menu for High-Margin Items
Not all items on your menu contribute equally to your bottom line. Review your sales data to identify best-sellers and high-margin products.
Milkshakes, sundaes, floats, and specialty desserts often offer higher profit potential than basic scoop sales. Seasonal flavours or chef-inspired creations can also allow you to raise prices while adding variety to your offering.
Consider rotating your menu regularly to create excitement and focus on items that deliver the best return on ingredients and labour.
Increase the Average Order Size
Boosting the amount each customer spends is one of the easiest ways to improve profitability in ice cream shops. Train your staff to upsell add-ons like waffle cones, toppings, or second scoops.
Offer combo deals, such as a sundae with a drink or a family bundle, to increase transaction value without much extra effort.
You can also introduce a “build your own” option, which encourages customisation and naturally increases order size.
Use Tech to Streamline Operations
Smart use of technology improves both customer experience and profit margins. POS systems like Square and Toast track sales, manage inventory, and highlight peak hours.
Scheduling tools like Homebase or 7Shifts can help reduce overstaffing and avoid unnecessary labour costs.
Using delivery platforms like Uber Eats or DoorDash extends your reach, while online ordering systems can drive pre-orders and off-peak sales.
Invest in Branding and Customer Experience
In a competitive market, how you make customers feel matters. A branded, Instagram-worthy space creates a memorable experience that customers will want to share and revisit. Train staff to offer excellent service- smiles and efficiency go a long way.
Strong branding also opens the door to selling merchandise or creating themed events, both of which can boost revenue.
If you need help developing a memorable brand, our logo design and brand strategy packages can help position your shop as a community favourite.
Plan for Seasonal Shifts
Every ice cream shop faces seasonal ups and downs, but you can still generate steady income year-round. During colder months, consider offering warm desserts like brownies or cookies, as well as ice cream cakes and hot drinks.
Pre-packed pints or holiday gift bundles are also great ways to keep sales moving during winter.
With a little creativity and the right business model, you can run a profitable ice cream shop that thrives in every season.
For a guided approach to implementing these strategies, the Entrepreneurs Success Blueprint offers a comprehensive roadmap tailored to small business owners ready to grow smarter.
Case Studies Of Successful Ice Cream Shops and Their Strategies
Some of the most profitable ice cream shops in the United States are not the biggest or flashiest. They are the ones with a clear identity, a loyal customer base, and a strong grip on their numbers.
By studying successful examples, you can uncover the practical strategies that turn a scoop shop into a thriving business.
Salt & Straw – Portland, Oregon
Salt & Straw began as a single pushcart and has grown into a nationally recognised artisan brand. What sets them apart is their storytelling approach to ice cream.
Each flavour has a backstory, often tied to local ingredients or collaborations with chefs and farmers. Their seasonal menus, limited-edition releases, and bold flavour choices allow them to charge premium prices.
This boutique model shows how positioning, creativity, and community connection can lead to scalable success. Salt & Straw’s ability to turn ice cream into a curated experience is a major profitability driver.
Jeni’s Splendid Ice Creams – Columbus, Ohio
Jeni’s has built a loyal national following by focusing on quality, consistency, and branding. Their flavours are crafted with responsibly sourced ingredients, and their packaging and online presence are instantly recognisable.
What makes their model effective is their omnichannel approach, they sell through scoop shops, grocery stores, and a direct-to-consumer website.
Jeni’s demonstrates that diversifying sales channels while maintaining brand integrity can generate millions in annual ice cream business revenue.
Local Independent Shop – Community-Based Success
In a small town in Vermont, a family-run scoop shop offers an example of grassroots profitability. By catering to local schools, offering birthday party packages, and participating in community events, this shop built strong customer loyalty and consistent revenue.
They sell custom ice cream cakes during the winter months and run special promotions for holidays and local festivals.
While they do not have a national footprint, they have achieved sustainable margins and steady growth by focusing on their immediate market and listening to their customers.
Each of these businesses shows that how profitable an ice cream shop becomes depends on more than just foot traffic. It is about understanding your customer, creating unique value, and building a business model that supports steady, diversified revenue.
Challenges to Profitability in the Ice Cream Business
While the idea of running an ice cream shop sounds appealing, the reality is that profitability does not happen automatically. Even in a high-demand market, many shops struggle to stay afloat due to operational and strategic missteps.
Understanding the most common challenges can help you avoid costly mistakes and build a business that lasts.
Seasonal Revenue Swings
Seasonality is one of the biggest challenges of the ice cream business. In many parts of the US, foot traffic drops significantly during colder months. If you rely solely on scoop sales, winter can leave a major dent in your revenue.
According to the International Dairy Foods Association, more than 60 per cent of ice cream sales happen between May and September. To remain profitable year-round, successful shops plan ahead by offering take-home products, hot drinks, and winter-friendly desserts like brownies or ice cream cakes.
Rising Costs of Operation
Rent, labour, and ingredient prices have all risen in recent years, putting pressure on margins. Wage increases at the state and federal levels, particularly in places like California or New York, can significantly increase labour costs.
Similarly, inflation has affected the cost of dairy, packaging, and even utilities. Shops that do not adjust pricing or manage portion sizes often see their profitability erode over time.
Intense Competition
Independent shops often face competition from national chains, franchises, and even local supermarkets offering premium ice cream pints.
Competing on price is rarely sustainable. Instead, focus on differentiating your shop through flavour innovation, branding, and customer experience. Shops that stand out in their neighbourhoods tend to build more loyal followings and stronger word-of-mouth referrals.
Operational Inefficiencies
Profitability in ice cream shops is also compromised when daily operations are not optimised. This includes issues like overstaffing, long wait times, inconsistent service, and poor inventory control.
Waste from over-scooping, forgotten pre-orders, or expired ingredients can quietly cut into your margins. Tracking data from your POS system and conducting regular team training can help you identify and fix these gaps.
Misaligned Pricing Strategy
Some shop owners hesitate to raise prices, fearing they will scare away customers. But if your pricing does not reflect your costs and brand value, you are leaving money on the table.
Remember that customers are often willing to pay more for quality ingredients, creative presentation, and a great experience. Make sure your pricing structure supports sustainable ice cream business margins.
If you want to stay ahead of these challenges, consider subscribing to the Entrepreneurs.ng newsletter. Each week, we share smart strategies and expert advice designed to help small business owners make confident, profitable decisions.
Tools and Tech That Help You Stay Profitable In Your Ice Cream Business
In today’s fast-paced market, ice cream shop profitability is no longer just about location and great flavours. Technology plays a vital role in improving efficiency, reducing costs, and increasing customer loyalty.
The right tools can help you make better decisions, run leaner operations, and uncover new revenue opportunities without adding complexity to your day.
Point-of-Sale (POS) Systems
POS platforms like Square, Clover, and Toast do more than just process payments. They track your sales in real time, identify your most popular products, and reveal buying patterns across different days and times.
These insights help you stock smarter, reduce waste, and schedule staff around peak hours.
Most POS systems also allow you to manage inventory, send digital receipts, and integrate with your accounting software, saving time and improving accuracy.
Inventory Management Software
Keeping track of dairy, cones, toppings, and packaging manually can lead to over-ordering or stockouts. Tools like MarketMan and BlueCart automate inventory tracking, suggest reorders, and give you a clearer picture of food costs.
These platforms help you maintain control over one of the biggest expenses in your ice cream shop: ingredients.
By understanding your usage patterns, you can reduce waste and maintain healthier margins.
Staff Scheduling and Labour Management
Labour costs can creep up quickly, especially if you overstaff during slow periods. Scheduling software such as Homebase or 7Shifts allows you to create shift rosters, monitor clock-ins, and track labour as a percentage of sales.
They also make it easier to communicate with your team and reduce last-minute shift gaps.
Staying on top of labour management is one of the simplest ways to protect your profit margins.
Online Ordering and Delivery Integration
Adding your shop to platforms like Uber Eats, DoorDash, or Grubhub opens up new revenue streams. Many customers now prefer ordering desserts online, especially during peak summer evenings or holiday weekends.
Integrated delivery systems help you reach those customers while keeping your operations running smoothly.
Some POS platforms offer direct integration with delivery services, reducing the need to manage multiple dashboards.
Loyalty and Customer Engagement Tools
Loyalty programmes are powerful for repeat business. Apps like Fivestars or Smile.io reward customers for returning, referring friends, or reaching spending milestones.
These tools are often inexpensive and easily integrated with your existing POS, making them a smart way to increase average spend and long-term customer value.
Collecting customer emails or birthdays also allows you to send targeted promotions, event invitations, and seasonal updates. If you are looking to attract more entrepreneurial customers, you can even advertise your shop through Entrepreneurs.ng’s audience network.
Choosing the right tech stack for your business depends on your size, budget, and goals. But even small upgrades can make a big difference in your daily operations and long-term profitability.
Conclusion
So, how profitable is an ice cream shop? When managed strategically, it can be a rewarding and sustainable business with healthy margins, diverse income streams, and strong community engagement.
Throughout this guide, we have explored what makes an ice cream shop profitable in the US market: clear pricing strategies, efficient operations, targeted promotions, and a willingness to evolve with customer needs.
If you are ready to turn your vision into a thriving dessert business, we have you covered.
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Frequently Asked Questions (FAQ)
How profitable is an ice cream shop in the US?
An ice cream shop in the US can be very profitable, with average net profit margins ranging between 15 and 25 per cent.
Factors such as location, pricing strategy, labour management, and seasonal planning influence how profitable an ice cream shop becomes. High-performing shops can generate upwards of 500,000 dollars in annual revenue, particularly in high-traffic areas.
How much does an ice cream shop make per year?
A typical ice cream shop can make between 200,000 and 700,000 dollars annually, depending on size, product offerings, and location.
Premium shops with diversified income like catering, delivery, and branded merchandise can exceed 1 million dollars in yearly ice cream business revenue.
What are the biggest expenses for an ice cream shop?
The most significant ice cream shop expenses include ingredients, labour, rent, utilities, and marketing. Other recurring costs include insurance, POS system fees, cleaning supplies, and delivery service commissions. Managing these costs is essential to maintain strong ice cream business margins.
What is the average cost to start an ice cream shop?
Startup costs for an ice cream shop in the US typically range from 20,000 to 100,000 dollars, depending on the shop size, equipment needs, and location.
This includes equipment, permits, branding, renovation, and initial inventory. Using a business plan template can help you create a realistic financial projection for your shop.
What is the failure rate of ice cream shops?
Like many small businesses, ice cream shop failure rates can be high, especially within the first two years, if the business is not financially prepared or poorly managed.
Common reasons for failure include underpricing, poor location choice, seasonality mismanagement, and lack of marketing.
How can I make my ice cream shop more profitable?
To increase profitability in an ice cream shop, focus on upselling high-margin items like milkshakes, floats, and toppings.
Use portion control, schedule staff efficiently, and introduce seasonal limited-time offers. Strong branding and customer loyalty programmes can also help boost long-term revenue and retention.
What are the most profitable items to sell in an ice cream shop?
High-margin products include milkshakes, sundaes, ice cream floats, toppings, and premium waffle cones.
Merchandise like branded t-shirts or take-home tubs also contributes to profit without increasing labour. Offering event catering and online orders can further expand your ice cream shop revenue streams.
How do ice cream shops make money in winter?
Ice cream shops stay profitable in colder months by offering take-home pints, ice cream cakes, hot desserts, and beverages like coffee or hot chocolate.
Running seasonal promotions, selling holiday gift packs, and leveraging delivery platforms also help maintain income during off-peak seasons.
Can I run a successful ice cream business from home?
Yes, some entrepreneurs start their ice cream business from home by producing in a licensed kitchen and selling at markets, events, or online.
However, commercial licensing, zoning laws, and food safety compliance are important. A home-based ice cream business can be a stepping stone toward a full-scale shop.
Is an ice cream shop a good business idea?
Yes, when approached with the right strategy, an ice cream shop can be a profitable and enjoyable business.
The key lies in understanding your target market, managing expenses, offering high-quality and diverse products, and planning for seasonal shifts. With proper planning and execution, the return on investment can be significant.
