The High Price Of Ice Cream

May 13, 2004

By George Anderson

Numerous stories have been written on the escalating prices of dairy products and how consumers will react to having to pay more for items such as milk and ice cream.

Some retailers and food service operators have chosen to absorb some or all of the increases up to this point.

But as Karen Davis, owner of Davis Soft Ice Cream in Dillsburg, Penn., points out, “You can only eat so much.” We’re pretty sure she wasn’t talking about ice cream.

Others, such as Friendly’s, have reduced the size of some packaging to deflect consumers making a Rocky Road to Rocky Road comparison based on prices they’re paid for ice cream
in the past.

Ice cream prices have been hit, not only by higher milk prices, but by increases in cocoa and vanilla.

Cocoa prices have been hurt by political and civil unrest in the Ivory Coast while vanilla prices have skyrocketed after cyclones hit Madagascar.

Moderator’s Comment: How are consumers reacting to higher dairy prices and what should retailers be (or are they)
doing to avoid any negative associations as a result of the current circumstance?

Lynda Utterback, executive director of the National Ice Cream Retailers Association, said, “I have been in this industry for nearly 20 years and I have
never seen all of these things (market forces to raise prices) come together at one time.”

George Anderson – Moderator

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