PENNSAUKEN, N.J.—J&J Snack Foods Corp. will acquire Dippin’ Dots for $222 million, according to a news release. The transaction will be funded through a combination of cash and senior debt financing and is expected to close by the end of June 2022.
“Dippin’ Dots aligns perfectly with J&J’s portfolio strategy by adding an iconic, differentiated brand that uniquely complements our frozen novelty and frozen beverage businesses. With this acquisition, we can further leverage our combined strength in entertainment and amusement locations, theaters, convenience and supermarkets to realize added scale, operational and go-to-market synergies and create new selling opportunities among an expanded customer base,” said Dan Fachner, J&J Snack Foods president and chief executive officer.
Dippin’ Dots uses cryogenic freezing process to create unique “beaded” ice cream, yogurt, sherbet and flavored ice products. The company sells its products through national accounts, local accounts and a franchise network with over 140 franchisees.
“J&J Snack Foods has completed over 30 value-building transactions throughout the company’s history, and we have a proven, long-term track record of successfully integrating and scaling niche brands including ICEE, SuperPretzel, Luigis and others,” said Fachner. “As a part of J&J, we will have the opportunity to leverage our marketing and innovation capabilities to promote Dippin’ Dots and expand distribution into new markets while implementing initiatives to gain added operating efficiencies.”
“The Dippin’ Dots team is thrilled to be joining the J&J Snack Foods family. As a leader in the snack industry with a number of iconic brands and a strong record of product innovation, we believe J&J Snacks Foods is well-positioned to leverage our unique offering in the market and improve and grow the business going forward,” said Scott Fischer, CEO of Dippin’ Dots.
The ice cream category typically performs well in convenience stores.
“The ice cream category saw huge gains in 2020, up by double digits in both sales and gross profit per store annually,” said Jayme Gough, research manager, NACS. “Ice cream sales were 0.89% of all in-store sales, which was up 0.15 points from 2019. The total category brought in $26,033 sales per store in 2020, a huge increase of 21.4% year over year. Plus, the category averaged margins of 45.97% and accounted for an average of $11,967 gross profit dollars in 2020, an increase of 20.2% from 2019.”
Expect to see more consumers reaching for frozen treats in coming months, according to Zach Waite, director of strategic growth, Hershey’s Ice Cream. “Consumers have been eating at home a lot over the last two years,” he said. “I believe a shift back to more eating out and [selecting] items that are easy to eat on the go will be strong for the foreseeable future.”
See what those trends were last year and how you can get ice-cream ready.
For category managers of all levels looking to sharpen their analytical and decision-making skills, NACS offers two certified category management courses:
- NACS I Impact 21 Certified Convenience Basic Category Management course for newer category management and merchandising professionals from retailers and suppliers in the convenience and fuel retailing channel.
- NACS | Impact 21 Certified Convenience Advanced Category Management course uniquely tailored for experienced category management and merchandising professionals from retailers and suppliers in the convenience and fuel retailing channel.
More information available at NACS Training & Development Services.