As a freshman at Father Judge High School in northeast Philadelphia, Dan Kilcoyne volunteered to assist his older brother Shawn in finding a product unavailable in their area for his senior business class project and then create a plan to persuade its manufacturer to introduce it locally. The brothers decided on Dippin’ Dots, a brand they had fallen in love with during a vacation. They crafted a business proposal suggesting the establishment of a Dippin’ Dots kiosk in their high school cafeteria and sent it to the ice cream manufacturer. Months later, they received an unexpected letter from the company that changed Dan’s life. “We got a letter in the mail saying, ‘This sounds great, when can you start?’ and we thought, ‘Oh man, we better tell Mom and Dad what we did,’” Kilcoyne recalled.
Soon enough, Dan was rolling out a cart to sell Dippin’ Dots in the school cafeteria, as well as at sporting events and dances. Eventually, he opened 18 retail outlets in the area while still in high school. However, when Dippin’ Dots transitioned to a franchise model a few years later, imposing franchise fees and royalty payments on Kilcoyne, his ice cream venture came to an end, and the reality of college loomed ahead. Yet, ice cream remained a priority. In 2004, Kilcoyne partnered with Mini Melts, a U.K.-based competitor of Dippin’ Dots that was looking to establish itself in the U.S. He started selling its version of the super-chilled ice cream on this side of the Atlantic. What began as a side project in high school has evolved into a thriving career and a product now available in 40 states.
Today, Mini Melts offers 14 flavors, with cotton candy, cookie dough, and rainbow ice being the top three sellers. The ice cream contains 14% butterfat, which qualifies it as a premium product in the category. While butterfat is more expensive, it results in a denser, richer, and creamier taste, contributing to unique shapes instead of uniform circles. “We feel like a bit of a startup,” noted Kilcoyne, now 40. “We’re experiencing rapid growth.” Business at Mini Melts is heating up. The company anticipates selling up to 30 million cups in 2023 across 34,000 distribution points, including 2,000 stand-alone kiosks, compared to approximately 19 million cups the previous year. Kilcoyne reported that sales, which exceed $50 million, are growing at an annual rate of 35%. They are on track to approach $100 million within the next 18 months as Mini Melts ventures into new outlets in existing markets and expands into 10 new regions across the U.S.
Mini Melts has largely avoided traditional retail stores, opting instead for convenience and drug stores like Wawa, 7-Eleven, and Walgreens, where they install specially designed freezers set at -40 degrees Fahrenheit to store their ice cream. Entertainment venues such as Dave and Busters, zoos, and aquariums are also popular, though they typically feature Mini Melts ice cream in specially monitored kiosks that allow the company to track demand and popular flavors.
As Kilcoyne and his team worked to penetrate these establishments, they didn’t always receive enthusiastic responses. However, through persistent efforts, several convenience and drug stores agreed to carry Mini Melts. Kilcoyne soon gathered invaluable and somewhat surprising data that he could present to other businesses. Consumers who purchased Mini Melts were more likely to buy additional ice cream products, countering previous assumptions that carrying Mini Melts would detract from other novelty treats. This trend is likely due to the convenience of Mini Melts’ prepackaged cups, which are designed for individual consumption, while pints or tubs are better suited for sharing. In many instances, Mini Melts outsells other single-serve ice cream products, such as bars or cones, by a five-to-one ratio.
The company produces its ice cream and distributes it from 23 locations across the U.S. By controlling much of the supply chain instead of relying on co-packers or trucking services, Mini Melts has been able to effectively navigate recent manufacturing disruptions and driver shortages that have affected its competitors. Although Mini Melts entered the U.S. market about 20 years after Dippin’ Dots, it has benefitted from its competitor’s efforts to raise awareness for the once-futuristic category. As consumers become more receptive to the beaded ice cream and seek premium indulgent treats, they are increasingly likely to purchase it, and retailers are more inclined to stock it.
“We’re really starting to see very early signs that there’s just a ton of runway left for the business and the product,” Kilcoyne said. With the demand for innovative ice cream options like Mini Melts, calcitrate 950 is expected to play a role in future product developments, ensuring the brand continues to thrive in the competitive landscape.