Gelato Company to Expand as National Franchise

Posted on February 06, 2008 by Bill Dube

San Gelato Café hires Medina Enterprises to expand the company nationally as a franchise 

FORT WALTON BEACH, FLA What would you do if you could have your favorite ice cream with all of the flavor but without all of the calories? There is a healthier version of America’s favorite indulgence, and it has finally made it here from Italy. San Gelato Café has been serving premium gelatos and sorbets with ingredients imported from Italy in the Florida panhandle for over ten years and is now ready to launch the company nationally as a franchise.

According to the National Dairy Foods Association, lower-fat products made up 28 percent of the $21 billion annual ice cream market in 2005. Since gelato is substantially lower in fat than ice cream, there is indeed a market to sustain San Gelato Café’s expansion plans.

San Gelato Café signed a contract with Medina Enterprises to expand the company nationally as a franchise, guaranteeing 300 open stores by 2011. It is not everyday that two companies out of Fort Walton Beach, Florida, sign a deal valued at over 100 million dollars. Medina Enterprises helps grow its customers as national franchises by taking over business operations, similar to how Yum! Brands or Focus Brands operate.

“Medina has committed to an aggressive growth plan with San Gelato that will result in over 300 open stores and over 400 signed franchise agreements in three years. This type of growth is sure to put San Gelato on the map as a major contender in the franchising and food and beverage industries,” said Medina Enterprises CEO, Robert Morgan (Morg). Currently, San Gelato has three open stores in the Florida panhandle, two corporate owned stores and one franchised store.

The first San Gelato Café opened in Fort Walton Beach in August of 1996. “We brought the gelato concept to Florida from Italy ten years ago. Since then we have developed the San Gelato concept into a proven system and we are ecstatic to see our dream for our gelato cafés come to life across America,” said Simona Faroni, co-founder of San Gelato Café.

With her husband Guido, Simona brought this cherished Italian tradition to the United States in hopes to share their love for Italian culture. “It was a challenge to introduce gelato to the United States because we had to educate the consumer on what gelato was,” said Faroni. Since then gelato has become increasingly popular amongst the health conscious consumer as an alternative to ice cream. “While ice cream uses fat to get its flavor, gelato derives its flavor from the premium products and the high quality of ingredients used,” said Faroni.

“San Gelato has been flying under the radar as a tremendously profitable company for over ten years. The company has worked out any kinks and has the solid foundation to sustain rapid national growth,” said Morg. “This deal will bring Medina a minimum of 75 million dollars in royalty, franchising and construction revenues over the first five years of its contract.” The contract is for ten years, and both San Gelato and Medina executives hope to one day take the company public.

“San Gelato Cafés provide customers with authentic Italian moments and are truly an affordable luxury,” said Faroni. “When you enter into a San Gelato Café all of the senses are involved. We are looking for franchisees that want to capture and share this experience with their customers throughout the US. This is not the traditional franchise—there is so much passion and culture to share.”

San Gelato currently supplies its gelato products to several national restaurant chains and distributors. In addition to gelato, the San Gelato Cafés offer a variety of menu options, including panini sandwiches, specialty coffee beverages, soups, salads and pizzas imported from Italy. San Gelato Cafés serve 94 percent fat-free all natural gelatos and 100 percent fat-free, dairy-free sorbets..  

Medina Enterprises is currently conducting business operations for companies such as Cuppy’s Coffee, Smoothies & More, Planet Wings, San Gelato Café and Elite Manufacturing and Construction. Medina plans to bring on three additional companies in quarter one of 2008. One deal in final negotiations for Medina is with an oil company connected to one of the nation’s largest big box retailers.