Aggie Ice Cream Sales in Korea Exceed Resources

Demand for Aggie Ice Cream in South Korea is outstripping Utah State University's ability to supply it, necessitating a manufacturing transfer that will most likely take place this year.

Nutrition and food sciences professor Donald McMahon said when the agreement began between USU and the Korean retailer for the university's ice cream, Aggie Korea Co. Ltd., the role of USU was mainly to aid in the developmental stage. USU's dairy processing capabilities are not sufficient to keep up with expansion in Korea. Currently, the ice cream is manufactured by USU and shipped to Korea.

Manufacturing for sales in Korea is expected to be transferred to a company outside USU this year, McMahon said. The university has sent invitations to various companies and has been actively pursuing a manufacturer to produce Aggie Ice Cream under license from the university. The University Research Foundation will be responsible for the sale of the ice cream.

Korean sales have enabled USU's dairy processing department to update equipment.

"We put [the revenue] back into modernizing or repairing equipment," McMahon said. "We don't make a profit, but it's been good to have the income to maintain the facility."

Funding for equipment repair and modernization comes entirely from sales revenue. The equipment needs constant repair and some of the it was more than 40 years old, he said.

Former USU student Dugman Lee pitched the idea to sell Aggie Ice Cream in Korea to a Korean business group. An agreement was reached in November 1999 for Aggie Korea Co. to distribute USU's product.

"We get requests all around the world regularly [for Aggie Ice Cream]," said Steve Chadwick, licensing associate of USU's Office of Technology Management and Commercialization.

USU has not pursued other markets because it is not the university's goal to compete with other businesses, Chadwick said. The key factor in reaching an agreement with Korea was that the country's group liked the idea and was willing to invest money in it, McMahon explained.

Electroland, a large electronic company, purchased Aggie Korea Co. in January 2002. The new ownership is pursuing a new marketing strategy. The name Aggie Ice Cream has been replaced by Munakee Shalle, a name made up by combining the name of a secret waterfall in Africa with a place in England. It is meant to sound exotic and appeal to a wider audience, McMahon said. Aggie in Korean means cute or cuddly baby, potentially leading customers to believe the ice cream is only for babies.

Kyu-chan Cho, the president of Aggie Korea Co., has a son at USU. He has encouraged his business associates to send their children to USU, McMahon said.

USU developed two ice cream flavors specifically for sale in Korea: green tea (reduced fat) and red bean, a popular dessert item there. These flavors are available only in Korea. The country's most popular flavors are strawberry cheesecake, cherry vanilla and blueberries and cream.

By Kathryn Richards; katrich@cc.usu.edu
Photo by Angelie Christensen