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April 2011
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Staff

Publisher and Editor - Judith Martin-Straw

Yo Jethro - Shelly Blaisdel

LOCALmotion - Jozelle Smith

Looking Up - Bob Eklund

Ruth's Truths - Ruth Morris

Dear Editor- Cold Hearts at Cold Stone Creamery

Dear Editor, The Culver City Cold Stone Creamery has a cold heart for blood donors!

This time I couldn’t believe my ears. It seemed like deja vu, but I insisted that the expiration date of the coupon for a free ice cream and topping had not expired. The last time I gave blood, I got a similar coupon and showed up a couple of days after it expired. I was denied then, too, although I suggested that it would certainly be a good customer service move to give me one anyway. I didn’t get an ice cream.

But the young man behind the counter stated emphatically that they “…were no longer honoring the red coupons.” I restated that the coupon didn’t expire until the end of the month. He wouldn’t budge. Instead, he offered to “make me a good deal.” It sounded like the old bait and switch. Even if I had brought some money, I should be getting a “free” ice cream. Hadn’t I fulfilled my part of the bargain; I had donated a pint of blood to the Red Cross. Certainly it wasn’t condition of my gift, but by giving me the coupon, Cold Stone was receiving a promotional advertisement to all those who received them, the Red Cross staff, and undoubtedly friend and family and others who heard of the promotion. Maybe it was even part of a larger ad campaign. I left angry and with bitter taste in my mouth. Can’t anyone act honorably anymore? I keep wondering whether this isn’t a very poor customer service decision. Obviously it goes beyond the store owner. It goes all the way up to the franchisor (corporation).

Besides writing to the local media, I’ve also submitted a complaint with the American Red Cross and the Better Business Bureau (which has not received a response from the store). It is no wonder this store isn’t listed with the Culver City Chamber of Commerce!

I wonder how many customers they will lose for their poor business practices. Or do we no longer require that a business honor it’s word?

Brian Pogue

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3 Responses to “Dear Editor- Cold Hearts at Cold Stone Creamery”

  1. Michael McDonald says:

    Brian,

    As a former owner of a Cold Stone Creamery I can honestly say that my store would have honored the coupon. Just good business practice. But that’s one of the reasons I am not in business any longer. That coupon counts towards a sale to the company and that means 10% of the profit on that ice cream goes to the company. While it’s valid, the store doesn’t have to count it towards its weekly sales total. After it’s validity date, it counts as a sale so not only does the store loose the sales money (the free ice cream) but it also has to pay 10% of the value of what would have been a sale. And technically, each coupon is a loss because the owner does not get reimbursed by anyone for the value of the coupon. BUT IT IS GOOD BUSINESS AND IS BEING A GOOD NEIGHBOR. A complaint to CSC on the website will result in a coupon to you for an ice cream and will count against the store in the percentage complaint category. The acceptable rate used to be 1 complaint for every $150,000 in sales. My store NEVER exceeded that rate. My suggestion – make the complaint, get the free ice cream, and go somewhere else in the future.

  2. David says:

    I agree with Mr. McDonald. I too was a Cold Stone Creamery operator. I owned three stores. Two of them were among the top stores in the nation and the third operated at well above the average unit volume. Still we could not earn a profit.

    I think overwhelmingly, most Cold Stone franchise owners are not profitable for the reason given above and for many others. It may even be that no stores are profitable because of situations like to coupon example, but most notably because it was discovered that Cold Stone accepts kickbacks from the distributors that it forces the franchise onwers to use. This was reported on CNBC and in the Wall Street Journal. That causes Cold Stone franchises to become unprofitable.

    The franchise owners who rejected the coupon are probably like the rest of us. They are struggling to hang on financially and they were trying to convert a free ice cream serving (with kickbacks attached) to a $6 sale. To the customer, this is about the loss of a $6 ice cream and I can certainly understand his view. For the franchise owner, it’s about the impending loss of a possible $600,000 cash investment as well as the loss of his home and bankruptcy.

    It’s not the owner’s fault, it’s Cold Stone Creamery’s fault as well as the fault of Cold Stone’s parent company, Kahala Corp. But as long as Cold Stone continues to engage in kickbacks and until the federal government steps in says “no more kickbacks”, this will continue to happen.

  3. For insight into the issues that these former owners and current CS owners face daily and are dealing with – see the CS facts here:

    http://www.coldstonefacts.org

    -CSF

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