Ye Gelato Reaches 1,712 Stores: The Operational Challenges Behind Its Franchise Expansion

China’s freshly made ice cream market has seen further franchise-led expansion. According to a China Daily report published on 2 October 2026, Ye Gelato has grown rapidly since it began accepting franchise applications in 2024, reaching 1,712 stores across 237 cities by 11 September. That expansion reflects the growth of fresh ice cream chains, but also raises an important operational question for those considering a franchise in China: how can a promise of products “made fresh daily, with no overnight stock sold” be delivered across such a large network?

Store network grows rapidly after franchising opens

According to the report, Ye Gelato added 244 stores in 2024 and a further 916 in 2025. Those two years of openings account for a substantial share of its current network. The report ranks it as China’s second-largest ice cream chain by store count, behind DQ.

Opening up to franchising was a key milestone in this expansion. However, the total store count should not be treated as the number of franchised outlets, nor does it indicate how profitable individual stores are. For prospective franchisees, the number of cities served shows the network’s reach, but cannot replace checks on a specific catchment area, rent and footfall.

Ye Gelato has made stricter site selection and store-level financial projections important elements of its franchise model. Assessing its future development therefore requires looking beyond new openings to whether stores can maintain stable operations across different cities and trading environments.

Managing waste when overnight stock cannot be sold

Ye Gelato’s core product promise is that its ice cream is “made fresh daily, with no overnight stock sold”. Freshness is a selling point, but this also makes daily production volumes, the timing of sales and the handling of unsold products critical parts of store management.

The report says stores use timed promotions to reduce waste, including discounts after 9pm, which also attract late-evening customers. The company says this approach helps stores maintain gross margins above 60%.

That figure should be understood as a company claim and must not be confused with a net profit margin. Gross margin does not represent the final return after rent, wages and other operating expenses. Whether evening discounts can effectively clear stock also depends on local late-night footfall. For franchisees, the freshness promise needs to translate into workable ingredient preparation, production and stocktaking procedures, rather than remain simply a product claim in franchise marketing materials.

Local ingredients offer a point of difference

In April 2026, Ye Gelato opened its global flagship store in Shanghai and introduced an “Eastern Gelato” concept, incorporating Chinese ingredients such as Wuchang rice, jasmine, Chinese bayberry and kiwi fruit.

This approach to product development gives the brand a way to stand apart from conventional ice cream flavours. However, product differentiation must be considered alongside store operations. Prospective franchisees should investigate whether ingredients for new menu items can be supplied consistently, whether staff can make them to the required standards, and whether actual sales justify daily preparation volumes.

The report also notes that Chinese-made equipment has lowered the barriers to standardised expansion, with relevant alternative equipment priced at around RMB 50,000–60,000. This is equipment pricing, not a complete store-opening budget disclosed by Ye Gelato, and should not be used as an estimate of the total investment required for a franchise.

More competitors mean operations matter as much as scale

Ye Gelato’s growth comes amid intensifying competition. According to the report, DQ now has more than 2,000 stores in China and maintains a relatively high proportion of company-operated outlets. Meanwhile, tea drink chains are entering the freshly made ice cream market: Chagee has launched a “Geelato” range priced at RMB 18–26, while Heytea has opened stores selling ice cream at around RMB 19 per scoop.

These developments suggest that franchisees may face competition not only from specialist ice cream shops, but also from tea drink brands with established customer bases. Business models, product ranges and site requirements vary between brands, so another brand’s sales or payback performance should not be used as a straightforward guide to a prospective investment.

Practical tip: When considering a freshly made ice cream franchise, confirm the brand’s franchise rights for your intended area, obtain a full investment breakdown, and clarify who bears the cost of waste and how promotions are governed. Calculate gross profit, net profit and the investment payback period separately. Store growth is a useful starting point for research, but it cannot replace due diligence on an individual outlet.