Ice cream manufacturing in the UK: industry profile

The UK ice cream manufacturing industry has faced a challenging few years. As noted by IBISWorld, a complex mix of factors including rising input costs and inflation have lately put pressure on businesses' revenues and profits. Euromonitor report that economic and regulatory challenges led to a drop in the total demand for ice cream in 2024.

However, the industry continues to present opportunities, with analysts identifying growth potential in 'functional' varieties, for example. Whilst challenges remain, Mintel predict that improving real incomes should lead to an upturn in the market. Some of the most significant challenges and opportunities for those operating in the industry are explored in more detail below.

A small number of large players — Froneri and Unilever UK being the largest — hold a dominant position in the industry, accounting for over 80% of the total market share according to IBISWorld. However, a considerable number of smaller manufacturers enjoy success, often focusing on artisanal and locally sourced offerings.

Traditionally, the industry has been highly seasonal, with sales peaking during the warmer months and tailing off during the winter period. However, some manufacturers have attempted to position ice cream as a year-round indulgence — Unilever, for example, has marketed special winter ranges.

A range of key statistics for the period 2019-2023 are set out in the table below.

In terms of product type, the UK ice cream market is primarily segmented along the lines of format, into two broad categories: 'take-home' and 'impulse'. Take-home products, such as large tubs and multipacks, dominate sales through supermarkets and are typically consumed at home. According to GroceryTrader, the take-home ice cream market has grown by nearly 25% over the last 6 years. Impulse products — such as single-serve cones, bars, and lollies — are intended to be purchased on-the-go, for instance through convenience stores and ice cream vans.

Further, more qualitative distinctions may also be made between product types. Perhaps most notably, 'artisanal' ice cream — typically small-batch and hand-made — may be contrasted with 'mass market' offerings.

Price forms another axis of segmentation, with offerings typically classified as economy, mid-priced, or premium. Economy products include supermarket own-label tubs and value ranges. Mid-priced brands seek to offer a balance between affordability and perceived quality. At the top end of the price range, premium products tend to emphasise indulgence, provenance, or dietary specificity (eg, organic or low-calorie).

There are two main distribution channels for businesses in the industry: off-trade (retail) and on-trade (hospitality / foodservice). The off-trade channel — supermarkets, discounters, convenience stores, and so on — accounts for the majority of volume. The on-trade channel, encompassing ice cream parlours, cafes, restaurants, and leisure venues, plays a smaller but nonetheless significant role. The growth of direct-to-consumer e-commerce, particularly among artisan brands, has added a further channel that somewhat complicates these traditional divisions.

Commentators have noted a number of key trends which are likely to shape the course of the industry’s development in the coming years, presenting both challenges and opportunities. Some of the most significant of these are outlined below.

In recent years the UK ice cream industry has faced a complex landscape of intersecting economic and regulatory issues.

The new regulations restricting the promotion of high fat, salt and sugar (HFSS) products represent one such issue. As the Agriculture and Horticulture Development Board (AHDB) have noted, these regulations have the potential to reduce the visibility and thus the sales of ice creams, particularly those of the 'impulse', handheld variety. That said, the new regulatory landscape also offers opportunities for manufacturers producing reformulated, HFSS-compliant alternatives.

As the Guardian have reported, input cost inflation has put further pressure on profitability, with rising prices for key ingredients like milk, cocoa, and sugar driving up production costs. Smaller producers are likely to be particularly vulnerable to these pressures, due to limited economies of scale.

Increased manufacturing costs have meant retail price hikes, with ice cream prices up 13% year-on-year in January 2025, according to QSR Media. Rising prices may lead to consumer alienation, especially in the premium segment, where — as IBISWorld note — demand has already been hit by general cost-of-living pressures. However, discount brands and private labels may benefit as customers seek cheaper alternatives.

Nonetheless, there is cautious optimism among some analysts. IBISWorld, for example, predict that input costs are to stabilise, whilst Mintel note that improving real incomes may support volume recovery and premiumisation in the medium term.

Whilst it remains the case that ice cream products are most commonly marketed as 'indulgent' treats, growing societal concern with health and wellbeing is reshaping the ice cream market to some extent, as Mintel have noted. In recent years there has been a rise in 'better-for-you' products with reduced fat, sugar, and calories, as well as functional benefits like added protein. Food consultants Egg Soldiers point to 'high protein, low calorie' products as one instantiation of this trend.

Although such products still represent a small share of total sales, IBISWorld note that some segments with health-conscious associations — such frozen yoghurt — have seen noteworthy growth in recent years. As such, this trend presents potential opportunities for manufacturers. Artisan producers in particular may seek to capitalise on it, combining premium ingredients with health-forward claims.

This development is likely to be partly driven by the aforementioned HFSS rules. However, there are some indications that it is also driven by 'organic' consumer concerns, with publications such as the Telegraph running articles providing advice on which ice creams are healthiest. As the AHDB note, brands that can offer HFSS-compliant products not only maintain promotional privileges but also appeal to health-conscious shoppers.

Despite the large market share held by a small number of large players, the UK ice cream sector has seen a wave of new entrants in the past decade or so, some of whom — especially those leveraging direct-to-consumer channels or regional loyalty — have enjoyed strong growth. Examples include Araw, Oppo Brothers, and Hackney Gelato.

Whilst there is considerable variation among these new manufacturers, many of them share an 'artisanal' focus on small-batch production, natural ingredients, and unique profiles, as well as emhpasising authenticity and sustainability. Some — such as Oppo Brothers, who boast that their ice cream contains "up to 60% fewer calories and sugar than regular premium brands" — have also capitalised on the trend towards health-consciousness described above.

While large conglomerates still dominate through scale and distribution, demand for differentiated, values-led products gives smaller players opportunities to grow.

Some of the new players who have entered the industry in recent years have done so as a result of farm diversification.

According to official statistics from the Department for Environment, Food & Rural Affairs, 71% of farm businesses in England had some diversified activity in 2023/24. On-farm ice cream manufacturing is one such activity, with ice cream ventures now being a recognised diversification strategy in the UK’s farming sector.

Dukes Ultra Premium Ice Cream is one example of an ice cream brand launched by a family farm as part of a dairy farm diversification initiative; another is Cumbrian Cow Ice Cream.

Diversification into ice cream manufacturing can provide farmers with new revenue streams to buffer against market volatility and subsidy reductions. However, it is not without its challenges — Farmers Weekly note that careful market research is key to success, and point to the significant associated costs and time demands.

Exports represent a growing opportunity for UK ice cream manufacturers. Data from the UN Comtrade database show a marked uptick in the UK's exports of ice cream in recent years. In 2024 the total value of ice cream exported reached $184,301,439, up from $166,954,338 in 2023, and $162,313,838 in 2022.

As the Observatory of Economic Complexity (OEC) note, key export destinations include Ireland, Germany, France, and the Netherlands. That said, some manufacturers report success in exporting to countries further afield. Mackie’s, for example, are expanding into Asia, capitalising on rising demand for premium Western-style desserts.

Manufacturers seeking to export their products must navigate challenges and complexities, however. Tariffs can erode margins, and regulatory divergence adds compliance burdens.

As noted above, two major players — Froneri and Unilever UK — command a very significant share of the market. Froneri, a joint venture between Nestlé and PAI Partners, operates three UK production sites; its brands include Rowntree’s and Nuii. Unilever UK, meanwhile, owns several other well-known brands, including Ben & Jerry’s, Wall’s, and Magnum. However, in 2024, Unilever announced plans to spin off its ice cream division.

Beyond these giants, the UK is also home to a diverse range of smaller and independent ice cream manufacturers. Examples include:

• Alandas — family-run Scottish brand known for its award-winning small-batch gelato and locally sourced ingredients.
• Araw — London-based artisanal ice cream brand with a direct-to-consumer focus, known for its nostalgic, globally-inspired flavours and focus on cultural authenticity.
• Beechdean — leading supplier of premium dairy ice cream to retail and hospitality venues across the UK.
• Hackney Gelato — London-based brand known for its Italian-style, small-batch production.
• Jefferson’s — artisan ice creamery based in Southwest London, known for using organic milk and natural ingredients.
• Jude’s — nationally recognised brand which began as a farm diversification project; aligned with trends in sustainability and innovation.
• Mackie’s of Scotland — leading independent brand known for its 'vertically integrated' production.
• Northern Bloc — Leeds-based brand known for its bold flavours and commitment to natural, plant-based ingredients.
• Oppo Brothers — specialist in 'better-for-you' ice cream with reduced sugar and calories.
• Tubzee — Halifax-based manufacturer of a diverse range of ice cream types, including South Asian kulfi.

ICAEW’s Library & Information Service can provide information on UK and Irish participants in the ice cream manufacturing industry via its wide range of company information services. For more information, please contact our enquiry team on +44 (0)20 7920 8620 or at library@icaew.com to discuss your requirements.

• Ice Cream Alliance (ICA)
• British Frozen Food Federation (BFFF)
• Society of Dairy Technology (SDT)
• Food and Drink Federation (FDF)
• Guild of Fine Food