Americans spend an estimated $2.5 billion a year on cookies, mostly on packaged supermarket varieties. About 10 years ago, Wally "Famous" Amos opened a small market niche with the premium-price, packaged cookies he sold in gift shops and specialty food stores. But the development of the fresh-baked, soft-and-chewy cookie a couple of years later created a new market segment. Famous Amos Chocolate Chip Cookie Co. now makes and sells a soft cookie, and it has plenty of competitors. Like David's Cookies and Mrs. Fields's Chocolate Chippery, most of these cookie purveyors operate mall or street-front stores or self-contained baking-and-selling modules in major department stores.
The Original Great American Chocolate Chip Cookie Co., created by co-owners Arthur Karp and Michael Coles in Atlanta in 1977, is one of the largest of the fresh-baked cookie companies. With 215 locations in 38 states, and 74 new stores planned this year, Karp and Coles share an evangelical belief in franchising. "This isn't just a distribution system," says Karp. "This is an organizational bonanza. We intend to make a lot of cookie millionaires."
On the other hand, The Famous Chocolate Chip Cookie Co., headquartered in Fairfield, N.J., adheres to the Mrs. Fields philosophy of franchising -- i.e., don't do it. Co-owners Frank Bonanno and Vincent Bonomo operate 75 company-owned stores, most of them east of the Mississippi River. Their expansion plans -- 50% this year, including new operations -- appear modest next to Fields's and Liederman's. "It's a matter of how well you run your companies," says Bonanno."Our emphasis is not on quantity."
The only public entry in the over-the-counter cookie market is The Original Cookie Co., started in 1976 and acquired in 1977 by Cole National Corp. Its 130 stores recorded sales of $26.5 million last year.
Except for Cole National, corporate cookie makers have stayed out of the cookie store business, but they have seen the future in soft cookies and have figured out ways to get a similar -- but by no stretch of the imagination an equivalent -- product into packages that can sit "fresh" for weeks on supermarket shelves. Keebler now makes Soft Batch (soft inside, crunchy outside); Nabisco Brands bakes Almost Home (moist and chewy); Frito-Lay delivers Grandma's Rich 'n Chewy (crispy outside, chewy in); and Procter & Gamble produces Duncan Hines Chocolate Chip Cookies (chewy inside, crispy out).