Dairy Queen - tesg's guide to big chain road food consumption

CHAIN -- Dairy Queen
Owner -- Berkshire-Hathaway
Primary Operating Region -- Nationwide
Number of Locations -- Over 5,000

It's a summer Saturday night in Grand Forks, ND. The Donut Hole is closed in the evenings, and their parking lot becomes overflow for the Dairy Queen next door. People walk in to the small, no-seating store and order their treats, then hang out in, on, or in front of their cars socializing as everybody else cruises South Washington. It was as good as it gets. It was Americana at its finest.

I highly doubt the founders could have envisioned the effect they would have on the Heartland over the years.

J. F. "Grandpa" McCullough and son Alex were ice cream manufacturers in the early 1930s. Along the way, J. F. theorized that ice cream tasted best before it was frozen hard, since lower temperatures numbed taste buds. They set out to perform some taste tests on a softer ice cream and see if they could find a way to manufacture it.

Two taste tests at local shops proved successful. Alex noticed a vendor selling frozen custard out of a special freezer on a Chicago street. By the summer of 1939, the McCulloughs had signed an agreement with the freezer's designer, Harry Oltz.

One of the first machines was installed at Sherb Noble's store in Joliet, IL. J. F. dubbed the store "Dairy Queen", because he believed he had the "queen"' of dairy products. The first Dairy Queen opened June 22, 1940. The H.C. Duke Company was brought on board to come up with an improved soft serve machine. They did so, and are to this day the major manufacturer of the machines.

Expansion was explosive and a bit uncontrolled. The Dairy Queen product was about the only consistency. I know of one restaurant that as late as 1990 was operating with a full-service dining room thanks to being grandfathered in under later standardized practices.

Standardization evolved over the years. Originally, Dairy Queens sold just their trademark soft serve. Shakes and malts came along in 1949. Dilly Bars in 1955. The Brazier menu debuted in 1958. Dennis the Menace became a spokes-character for DQ in 1972, becoming as common a site in DQ as the DQ logo itself in a relationship that lasted for thirty years (DQ decided not to renew the agreement in 2002 because the youth crowd didn't really relate to Dennis anymore). Dairy Queen became a staple of small towns in the heartland, the summer gathering point. Many stores were seasonal operations. Some still are.

The corporate umbrella is International Dairy Queen Inc, which was formed in 1962 and based in Minnesota. Today, IDQ also owns the Karmelkorn and Orange Julius brands. IDQ because a wholly-owned subsidiary of Berkshire-Hathaway (Warren Buffet's monster) in 1998.

So what makes Dairy Queen different from the rest? First off, the soft serve is actually ice milk with only 5 percent butterfat, something that came along because McCullough simply found it tasted better in this format. From there, it's what they do with the soft serve that makes Dairy Queen special. Soft serve in a cone covered in a hard shell. The trademark curl at the top. Dilly bars. Mr. Misty's. Blizzards. Frozen cakes. All instantly identifiable as DQ products by appearance or taste.

The hot foods, marketed for years as the "Brazier" (more or less French for "charbroiled") menu, have traditionally been your usual fast food fare. Hamburgers, hot dogs, some chicken items, and occasionally some other oddball items. All fine, but nothing is terribly special here. DQ wants to change that.

IDQ is pushing a new concept called "Grill & Chill", featuring a new more upscale look and hot foods menu to compliment the desserts. "Grill & Chill" restaurants use a lot of the interior tricks being used by the premium sandwich and $5 burrito joints today...wood, stone, and rich colors. Ordering is done at the counter, you are given a number tag, and your food is delivered to your table, ala Hardee's and Culver's. Menu changes include the addition of sandwiches with fresh-baked bread, quesadillas, upscale salads and a whole new breakfast menu.

New Grill & Chill locations are going up across the Midwest. I guess the idea going forward is that franchisees can either build Grill & Chill stores or "Treat Center" dessert-only stores, and if IDQ had its way, all existing stores would also be converted this way. But several franchisees expressed unhappiness about Grill & Chill because the cost of upgrading was out of reach for many small-town single-store operators. DQ eventually allowed stores not converting to adopt part or all of the new menu. But stores that are doing full conversions are finding unexpected demand on the hot foods menu side, as well as finding people are more likely to come inside than buzz through the drive-thru.

I think you'll be just fine whether you're going into the all-new Grill & Chill, visiting the old neighborhood walk-up, or the DQ-Orange Julius in the mall. No matter how gussied-up or stripped-down it is, it is ultimately still DQ.