Buffett’s Dairy Queen Expands in China
International Dairy Queen Inc., the ice-cream maker owned by Warren Buffett’s Berkshire Hathaway Inc. (BRK/A), plans to expand in China and Thailand to take advantage of opportunities in developing countries.
“Our strategy for international development is emerging markets, and Asia has been a focal point,” Chief Executive Officer John Gainor, 55, said in a phone interview. Dairy Queen is customizing its menu based on the “taste profile” of consumers in each country, he said.
The Green Tea Blizzard dessert is the number-one seller in China, while the Oreo Blizzard takes the title in the U.S., Gainor said. The ice-cream maker, which has more than $3.2 billion in annual sales, opened its 500th location in China and has more than 270 in Thailand. It expanded into Saudi Arabia, Egypt, Guatemala and Singapore in 2011, the Minneapolis-based company said yesterday in a statement.
Dairy Queen, whose brands include fruit-drink maker Orange Julius and popcorn-retailer Karmelkorn, was purchased by Omaha, Nebraska-based Berkshire in 1998. Buffett, Berkshire’s CEO and chairman, said at the time that he and Vice Chairman Charles Munger were regulars at Dairy Queen.
“We have put our money where our mouth is,” Buffett said in a letter to shareholders.
Berkshire has historically derived a “relatively small amount” of sales and profit from international markets, the firm said last month in a regulatory filing. International growth has exposed it to increased risks from “unstable political conditions and civil unrest” in certain countries.
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