Jonathan Frutkin | Crain's Phoenix

In this ongoing series, we ask executives, entrepreneurs and business leaders about mistakes that have shaped their business philosophy.

Jonathan Frutkin

Background:  

Radix Law, formerly The Frutkin Law Firm, in Arizona is known for its work in business law, litigation, bankruptcy and estate planning.

The Mistake:

I decided to open ice cream stores in the Las Vegas area.

I became a regional franchise developer for an ice cream chain called Maggie Moo’s, which was a family-oriented version of Cold Stone Creamery. It was very popular on the East Coast, with some other locations around the country.

I decided that the perfect place to build out Maggie Moo’s locations was Las Vegas, Nev. It was doing so well in areas around the East Coast that were cold – that had winter half the year – that I figured, "What would be better than opening an ice cream store in the desert, where you could eat ice cream practically every day?"

So, I decided to open ice cream stores in the Las Vegas area – in shopping malls, and strip centers and all over.

They did horribly. The reason was that the states with the lowest ice cream consumption per capita are Arizona, California and Nevada. To the contrary, the highest consumption per capita is in Minnesota and Massachusetts. Of course, I didn’t know this at the time.

The reason is that people tend to celebrate more with ice cream in places where they don’t have sports year round. For example, in Massachusetts, they have summer baseball leagues. After the game, win or lose, you go have ice cream. Because they have baseball season all year round in Arizona and Southern California, you don’t go and get ice cream every time.

Also, in places like Massachusetts, when you’re watching a movie on a Saturday night – you’re kind of hibernating. You tend to eat ice cream, which is kind of a weird tradition in winter climates. You eat ice cream while bundled up under the covers. That doesn’t happen in warmer weather places.

It’s about asking more than the general questions.

The Lesson:

My takeaway was: Don’t necessarily go with your first instinct. Do a little bit of research. Because, if I had found that out beforehand, I wouldn’t have been opening up a bunch of ice cream stores that nobody went to throughout the Las Vegas area.

It’s normal to talk to other people who have done what you want to do. But sometimes it’s about more than asking the general questions. Whether it’s opening up a new business, or even hiring an employee and talking to someone as a reference, it’s about asking more than the general questions. It’s about asking the follow-up questions.

In the case of ice cream, a good question for a store owner would be, “Do you sell a lot of ice cream during the winter?” The answer is, “Yeah, we actually sell more in the winter.” That would have been eye-opening for me in looking to go into the Las Vegas market.

Another good follow-up question would have been, “How often do you have sports teams in here?” I could have asked that same question to people with kids in Las Vegas.

One of our locations was by a high school. We were always looking for places to hang out after the high school football game when I was a kid. In Las Vegas, it turns out, there’s always somewhere to hang out.

I guess I didn’t appreciate that at all until I got there.

Follow Radix Law on Twitter at @frutkinlaw.

Photo courtesy of Jonathan Frutkin

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