5 days ago
This popular ice cream chain closing 500 stores. Here's why
A popular ice cream brand based in the United States is closing 500 of its stores nationwide, thanks to a move that resulted in collateral damage.
Pharmacy company Rite Aid is filing for a Chapter 11 bankruptcy, resulting in the closure of 500 hand-scooped ice cream counters of Thrifty Ice Cream. The Rite Aid-owned company will thus bear the brunt of its parent going out of business, as per a report by The Street.
When companies like Rite Aid file for bankruptcy, they are forced to close down other brands they own, even if they become successful on their own.
Rite Aid currently has 500 pharmacies inside which there are counters of Thrifty Ice Cream.
Thrifty gained popularity through the unique scoop it provides. Instead of a spherical scoop of ice cream, Thrifty Ice Cream is cube-shaped. It is also known for its innovative flavours.
'Thrifty ice cream was launched in 1940 at a small factory in West Hollywood. Angelenos soon flocked to the flagship Thrifty Drug Store in downtown Los Angeles to sample ice cream from the soda fountain. The high-quality, small-batch ice cream even snagged awards from the L.A. County Fair. By the 1970s, Thrifty ice cream had attained cult status along the West Coast, with significant celebrity shoutouts,' Thrifty says on its website.
According to The Street, Thrifty outlets inside Rite Aid pharmacy stores have to close down mandatorily. Since the 500 Thrifty ice cream outlets are not outside Rite Aid stores and sells the products within the pharmacy's roofs itself, they cannot be sold as a separate asset.
However, some franchised Thrifty ice cream outlets are not owned by Rite Aid.
'You can find Thrifty ice cream in the freezer section of your favorite retailers, like Rite Aid, Albertsons, Vons and more. You can also find it at scoop counters across California, Arizona and a growing number of regions in the U.S. and Mexico,' Thrifty website states.
As part of Rite Aid's Chapter 11 bankruptcy, Thrifty Ice Cream will be sold as an asset.
A buyer could choose to keep operating the brand, selling pints, quarts, and packaged ice cream to grocery chains. It can also choose to supply to the non-Rite Aid-owned ice cream counters.
However, with Rite Aid's bankruptcy, Thrifty Ice Cream's future as a whole still remains uncertain.
