Phillip Chang learned English by listening to Christian sermons on the radio as he drove to one of the two or three jobs he always had in rotation when he first came to the U.S. from South Korea.
He was 21, with no money and no business background.
“I’d listen to the pastor sermons because they are the ones who speak slowly and give full sentences,” the Yogurtland Franchising Inc. founder and CEO said.
“They don’t use slang. That’s how I learned. I taught myself,” Chang, who rarely grants interviews, told the Business Journal.
“That’s my background: I always have to push myself [and ask], ‘OK, what’s next?’ If I stop, I will not win this game.”
The game’s been a winning one for Chang, who started his company with his wife, Michelle Chang, as a single boba tea shop in Fullerton.
When the two saw frozen yogurt gaining traction in the market, they made a change, and also came upon the idea of elevating the customer experience with a variety of options in both flavors and toppings.
Yogurtland, now based in Irvine, celebrates 15 years in business this year.
It has more than 280 locations in the U.S., Dubai, Indonesia and Thailand, among other places.
The Business Journal ranked Yogurtland No. 15 on its most recent list of the largest OC restaurant chains, based on an estimated $133 million in 2019 sales.
Hello Holsom
The company’s initial concept rocked the restaurant industry by putting the power in the hands of the customer to customize their frozen yogurt options.
Competition became fierce over the years following Yogurtland’s 2006 start, and the segment today is no longer as hot as it once was.
That’s resulted in Chang’s latest push, one that gives way to a new build on an old concept of customization: Holsom by Yogurtland.
The company recently debuted the first of what will be many Holsom locations, designed as local hangouts that allow customization of everything from toast to fruity drinks. And, frozen yogurt, of course.
“It’s been already 15 years and we’re known for all this innovation and amazing flavors we have developed,” Chang said. “Our customers are always looking for something unique and unexpected flavors, so we had done an amazing job [with Yogurtland]. That’s our brand, which we built so far and customers’ desire [for customization] is not stopping right at frozen yogurt. They want more and we (would) like to provide what’s next.”
Chang described Holsom as a hybrid brand, straddling dessert and a light meal in a restaurant café-type atmosphere, serving as a gathering place akin to what one might find overseas in Asia or Europe.
The first Holsom spot is a 1,200-square-foot door in Huntington Beach on Edinger Avenue.
Quality Ingredients, and Tasty
The company is also banking that high-quality ingredients priced lower than comparable offerings on the market will help Holsom’s growth.
“Millennial and Gen Z’ers demand you can’t just have a healthy-for-you option; it [also] has to be delicious,” said Yogurtland Senior Vice President Sam Yoon.
“And I think one of the things we can absolutely guarantee is it is delicious.”
Yoon said, by way of example, when the company surveyed customers late last year after it relaunched its plant-based salted chocolate soufflé flavor, the feedback tended to be surprise that the option was tasty yet vegan. It made the company confident it can deliver on that front while also driving value.
Holsom bowls are priced from $6 to $9, toasts around $5 to $7 and beverages from $2.50 to $4.
“It’s going to be value driven,” Yoon said. “If we were to compare some of the prices on offer in the market, our customers will definitely see that the price is very, very competitive. Juxtapose that along with high quality.”
Debt Free
Yogurtland launched its new concept during a pandemic in which the outlook for restaurants was and, for some, remains murky. It’s a good example of why Chang’s conservative approach to running the business helped it navigate 2020.
The company has no debt and owns its buildings and manufacturing plant in Paramount, giving it plenty of flexibility when the screws began tightening last year.
Having no debt and strong cash flow management gave Yogurtland a higher chance of survival, Chang pointed out. It also allowed him and his team to innovate.
“We have to keep running,” he said. “It’s like riding a bicycle. If you don’t move, you’re going to fall. It’s [as] simple as that. Especially at this time, there’s so much fear and nobody wants to invest. They are conserving.
“We can go actually opposite [to that] because we are in a different situation,” Chang said. “The company’s financially strong and our innovative mindset is very aggressive all the time. It’s a great opportunity for us to grow more because of the market conditions out there.”
Balancing Objectives
Chang’s been mindful and conservative from the start.
He was a first-generation immigrant when he came to the U.S. and started from scratch with a belief in himself and the idea that innovation and creativity would always trump the competition.
“I always like to experience new things, change to new systems,” Chang said. “I know many people around me; they don’t like me in that point of view because I keep changing. I always keep saying, ‘OK, this is [a] better way [and] because of that habit, I think that’s why I am here right now because I don’t want to stay in the same method all the time.
“That’s human nature. People get complacent. They don’t want to change, but I have that mindset [which is], first of all, it’s a survival mindset because when I came to America, yes, there’s so much disadvantage I had, so I had to keep pushing myself,” he said.
Chang was working two or three jobs to buy his next meal or pay the rent, all the while saving some of his pay until he had enough to start his own business.
Philanthropy Focus
While Chang said he works hard in an effort to keep the company relevant, a part of his constant push for success comes down to philanthropy, which is intertwined with the Yogurtland brand and business model.
“Why I work hard, I shouldn’t ever forget our company’s goal to share love, joy and hope,” Chang said of what drives him. “Building a business and earning money is just a tool to fulfill my end goal.”
He believed in helping others so strongly that he stepped away from the business in January 2014 to focus full time on charity work, specifically helping children in need via his overseas missionary work.
He returned later that same year, realizing he could have just as much of an impact remaining in the business world and formalizing his philanthropic efforts via the Yogurtland Cares nonprofit focused on helping women and children.
Chang has historically shied away from talking about the company’s charity work and donations, explaining he doesn’t want to come across as boasting about it or, worse, having it be confused as a marketing ploy.
The company’s donated millions of dollars, with Chang declining to say just how much outside of describing the sum as “significant.”
“I try not to forget, I’m not just working because of the money,” Chang said. “I think that [is a] really important part. That’s why our company receives so much love from our customers and the people around us because we share love. I’m more proud of achieving that, rather than the business [being] successful.”
