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By JOYZELLE DAVIS

Staff Reporter

Don’t call frozen yogurt a “retro” confection when talking to folks like Maria and Raphael Baker, whose L.A.-based Humphrey Yogart Systems Inc. boasted a 30 percent revenue increase in 1997 from a year earlier.

Maria Baker, who founded the business in the early ’80s with her husband Raphael, insists that Humphrey Yogart isn’t simply about pumping out low-fat desserts.

“It’s an event concept,” she said. “We want people to drive past dozens of frozen yogurt stores to come here.”

Customers have a choice of just two flavors chocolate and vanilla. But from there, the possibilities are nearly endless; the store will blend in a wide variety of fruits, candies and spices that range from pumpkin to Heath Bar.

A spoonful of flavoring is added to the chocolate or vanilla base, then blended in a machine that squeezes out a customized frozen yogurt flavor such as mango-peanut butter.

Baker half-jokingly claims that one could have a “different flavor every day for 45 years.”

The Bakers debuted their idea by subleasing a space in a Manhattan Beach deli in 1982. When that proved successful some customers said they drove 40 minutes for the yogurt they decided to pour all their efforts into their business.

Maria Baker quit her job as a director of licensing at Lorimar Productions and Raphael Baker, an actor, stopped auditioning. They scraped together enough money to open a store in Sherman Oaks in 1984 through their savings, a loan from their landlord and a loan from one of their Manhattan Beach customers.

“We were so undercapitalized that we didn’t have money for a sign board,” Maria Baker said.

But more than a decade later, long after other frozen yogurt businesses fell out of favor, Humphrey Yogart is embarking on an ambitious expansion plan.

Humphrey Yogart functions as a franchise, which means that operators pay a $30,000 up-front fee, then ongoing 4 percent royalties based on a percentage of a store’s gross sales.

Franchisees must order food from authorized vendors and abide by certain standards. In turn, the Bakers help the franchisees choose a location, train their employees and offer ongoing support.

There are nine franchise stores: three in Orange County, one in Palm Desert, one in San Diego, three in Los Angeles and one in Guam that will open this month. The Bakers own and operate an additional store, located at the Beverly Connection shopping center.

Nationwide, a few frozen yogurt franchisers are enjoying a rebound in business after years of disappointing results, according to Mark Hamstra, who follows the industry for the publication The Nation’s Restauarant’s News.

Frozen yogurt chains “exploded” in the ’80s, he said, amid predictions that it would be the dessert of the future. But consumers revolted against the idea of less-tasty, “healthy” food and opted instead for ice cream.

“The companies that have managed to become successful again have positioned themselves as indulgences rather than a healthy alternative to ice cream,” Hamstra said.

Two years after the couple opened their first Humphrey Yogart store, they moved to Oregon so their children could attend better schools. The Bakers sold the store as well as the licensing rights to do business in Los Angeles. In Portland, they opened another Humphrey Yogart store, which they operated until all their children graduated high school in 1991.

They then returned to Southern California, intending to build up the chain here. But their plans were complicated by the fact that the new owner of their former Sherman Oaks store had the rights to the name and concept in L.A. County.

Mike Mooslin, president of Koo Koo Roo International, was working as a restaurant consultant when he first met the Bakers in the early ’90s, and he felt that the Humphrey Yogart concept had a “fun and participatory” atmosphere that could stand out in a saturated field.

“It’s one of the few environments where customers complete strangers talk to each other and exchange ideas on yogurt blends,” Mooslin said. “The Bakers created a social environment out of an affordable indulgence.”

With Mooslin’s encouragement, the couple opened stores in outlying areas such as Orange County and Palm Desert. In 1995, the Bakers regained their local licensing rights through a complex legal agreement and began expanding in Los Angeles as well.

Baker intends to grow the company through further franchising deals. Humphrey Yogart will add at least two more stores this year both in Orange County and is in negotiations for sites in Las Vegas in Colorado. Baker projects that the chain will make $4.2 million in 1998, up 90 percent from 1997’s revenues.

Once the chain attains a “critical mass,” which she estimates at 15 to 20 stores, Humphrey Yogart plans to launch a marketing campaign and possibly bring in a financial partner or launch an initial public offering in order to fund further expansion.

The concept has sparked a passionate following among both customers and franchisees like Steve Fields, who decided to leave his Foster’s Old Fashioned Freeze fast-food franchise after he visited the Humphrey Yogart store in Sherman Oaks.

“I loved the yogurt itself and the idea that the customer can make it to order,” said Fields, who will be opening his fourth franchise in Orange County this year. “Most people who come into the store are in good moods, because it’s a fun activity and they aren’t spending a lot of money.”

Humphrey Yogart Systems Inc.

Year Founded: 1984

Core Business: Franchising frozen yogurt stores

Employees in 1984: 12

Employees in 1997: 120 (approximately, because labor force is seasonal)

Revenues in 1996:$1.7 million

Revenues in 1997: $2.2 million

Revenues in 1998 (projected): $4.2 million

Top Executives: Maria and Raphael Baker

Goal: To grow through franchising, attract quality owners and operators and build stores in quality locations

Driving Force: Consumer taste for an upscale, cafe-like atmosphere where people can enjoy an “affordable indulgence” that’s fun to create

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