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What is The Kona Ice Franchise Cost?
Nothing beats a premium shaved ice cream on a hot, summer day. With all the flavors that give you a cool party in your mouth, you’ll undeniably be transported to a place with rainbows and sunshine. And this is what Kona Ice will bring every kid or adult in their fun and inviting shaved ice cream truck.
Franchising a mobile business is less of a hassle than a brick-and-mortar one. You won’t have to deal with rental fees, which sometimes take up a huge chunk of your capital. Read more about what the Kona Ice franchise cost is.
Company Overview
Kona Ice hailed from Florence, Kentucky in 2007, with a growing 1,400 units. The franchisor Kona Ice, Inc sells premium shaved ice, ice cream, and other relevant products to consumers. The franchisor includes the use of all trademarks including the name “Kona Ice,” service marks, trade names, and logos. Its truck the Kona Entertainment Vehicle (KEV) is also patented as FlavorWave Self-Service System.
Franchise Training Details
Here are the training details for franchisees:
- The franchisor requires qualified managing owners, representatives, or designated managers who must complete the training satisfactorily before opening a Kona Ice franchise
- The initial training program is called “Kona Kollege”
- Franchisees who purchase an existing Kona Ice franchise due to transfer are also required to attend the initial training program
- Kona Kollege will include about 16 to 20 hours of OJT training at Kona Ice’s headquarters in Florence, Kentucky
- The franchisor may require designated managers, employees, or representatives to attend further training as a refresher. The franchisor may also require them to attend additional training courses, which are optional.
Franchise Territory
These are the details of the franchise territory agreement for Kona Ice franchisees:
- The franchisor grants exclusive territory to franchisees depending on geographic area and population specifications, as well as other demographic characteristics
- The franchisor will only grand one licensed franchisee for any area with a maximum population of 100,000
- Franchisees who operate in relatively smaller areas that are densely populated may also operate in significantly larger areas
- Unless the franchisee purchases an additional KEV, the franchisor may reduce the size of the granted territory to 100,000 people if the population increases over 25 percent
- The franchisor will not grant another franchisee to operate the a KEV or similar business within the protected territory
Franchise Obligations and Restrictions
- The franchise owner must be a natural person with 25 percent ownership of the franchise
- The franchisor will require an active owner who will run Kona Ice during the first 60 days. Afterwhich, the franchisor may allow franchisees to assign a designated manager that is also approved by the franchisor
- Franchisees may only sell products and offer services approved by the franchisor
Franchise Term and Renewal
The initial franchise term is 10 years. However, if the franchisees meet other requirements and are in good standing, they may apply for another 10 years.
Financial Assistance
The franchisor doesn’t offer direct financing or guarantee franchisees a note, lease, or obligation. However, franchisees may get help from third-party lenders for financing.
Did You Know?
Here are some fun facts you should know about Kona Ice:
- Tony Lamb is the founder of Kona Ice and he said ice cream trucks are creepy, so he created shaved ice, ice cream trucks instead.
- The brand invented the Kona Mini, a smaller version of the Kona Ice truck to sell their products indoors during the winter season
- Kona Ice sells some vegan shaved ice and also have products that use natural Stevia as sweeteners for the health-conscious consumers
- Kona Ice grew its sales to approximately $125 when it offered franchising opportunities to seasonal employees, millennial side-hustlers, and retirees. The owner said he wanted to help these people who are running into hard times.
Kona Ice Franchise Cost
Your Investment
Here’s the Kona Ice franchise cost:
| Name of Fee | Low | High |
|---|---|---|
| Initial Franchise Fee | $15,000 | $15,000 |
| KEV and Installed Equipment | $127,450 | $137,450 |
| Training Expenses | $140 | $950 |
| KEV Delivery | $500 | $4,000 |
| KEV Compliance Fee | $0 | $5,000 |
| KEV Insurance for 3 Months | $500 | $1,500 |
| Tax, Title, and Licensing of KEV | $180 | $6,000 |
| Initial Inventory | $6,475 | $6,475 |
| Optional Inventory | $0 | $225 |
| Permits and Licenses | $250 | $1,500 |
| Real Estate or KEV Storage | $0 | $1,200 |
| Computer System and Hardware | $0 | $1,000 |
| Additional Funds (3 months) | $0 | $9,000 |
| ESTIMATED TOTAL | $149,995 | $189,300 |
Other Fees
| Type of Fee | Amount |
|---|---|
| Royalty | $3,000 for years one and two, $3,500 for years three through six, $4,000 for years seven through ten. |
| Additional Equipment Royalty | Varies based on the type of additional equipment (currently $600 to $2,000 per year). |
| Territory Reservation Fee | $10,000 per territory. |
| Territory Infringement Fee | $1,000 plus invoice amount for first violation; $5,000 plus invoice amount for second and subsequent violations. |
| Initial Territory Adjustment Fee | $1,000 to $2,500 |
| Territory Relocation Fee | $2,500 |
| Brand Fund Contribution | Currently $500 per year. |
| Additional Training | The then-current fee (currently not charged). |
| Kona Email Address Fee | $168 per e-mail address per year. |
| Technology Fee | The then-current fee (currently not charged). |
| KonaOS Business Management Software Fee | The then-current fee (currently not charged). |
| Insurance | Reimbursement of our costs, plus a 20% administration charge. |
| Customer Satisfaction Reimbursement | Varies under circumstances. |
| Misappropriated Success Guide Fee | Will vary under the circumstances. |
| Non-Compliance Fee | $1,000 for the first violation; $5,000 if violation is not corrected within 30 days; $5,000 for the second violation. |
| Payment Service Fees | Up to 3% of total charge. |
| Late Fees | $25 per day, plus the lesser of the daily equivalent of 12% per year simple interest or the highest rate allowed by law. |
| Returned Check or Insufficient Funds Fee | $100 |
| Indemnification | Will vary under the circumstances. |
| Professional Fees and Expenses | Varies under the circumstances. |
| Renewal Franchise Fee | $7,500 |
| Transfer Fee | $5,000 to $7,500 |
| Ancillary Transfer Fee | $500 |
| KEV Remodel or KEV Upgrades | Will vary under circumstances. |
| Mystery Shopper Fee | $1,000 per occurrence. |
| Lead Procurement Fee | $15,000 or the third-party broker fee. |
| Audit | Cost of audit and any related accounting and legal expenses and related travel and administrative expenses (the franchisor estimates this cost to be between $1,000 and $10,000). |
| Optional E-Lead Program Fee | $500 per year. |
If you’re ready to start your Kona Ice franchise, visit their website for more details. And for other franchise info, read more here at Franchise HOW!