Simple businesses such as ice trucks are always attractive to entrepreneurs.
There aren’t a lot of costs involved, and it’s relatively easier to succeed, especially if you are running under a brand like Kona Ice.
It is one of the 10 Best Food Truck Franchises of 2023 that you must own. After conducting thorough research on the market, it is founded that this franchise opportunity is so excellent that it is also one of the best franchises that one must own.
If you are considering operating a Kona Ice franchise, you are in luck because they offer franchising at low costs. We will discuss Kona Ice and its franchise system in this article.
About Kona Ice and Its History
Kona Ice is a mobile shaved ice and frozen treat franchise. They started in 2007.
The owner, Tony, drove their first truck himself around Kentucky, where the company was born.
He developed the business model as he went on and found the popular flavors they have in the Kona Ice menu at affordable prices. Tony decided to franchise the brand in 2008, and they opened 15 stores in their first year.
The company grew fast, and they now have over 1,500 stores across the United States. They were one of the fastest-growing franchises in the United States over the years.
Franchise Model Table
| Initial Investment | $167,115-$212,100 |
| Franchise | YES |
| Franchising Since | 2008 |
| Franchise-Fee | $15,000 |
| Royalty-Fee | $3,000-$4,000/year |
| Liquidity | N/A |
| Estimated Outlets | 1,515 |
How Much Does It Cost To Open A Kona Ice Franchise?
Kona Ice falls under the low-cost franchises because the total average initial investment is between $167,115 and $212,100.
This includes the $15,000 franchise fee and all the associated startup costs.
Startup costs could vary depending on several factors like the location, size of the store, number of employees, and so on.
Kona Ice Franchise Requirements
Kona Ice has no net worth or liquidity needs from its franchisees. They only look for people who can have an active involvement in the opening and operation of the business.
Having a professional background as an owner or an operator is essential to your approval.
They also require the person in charge to promote the brand during their active involvement in the operations of the business.
Any kind of professional background about this is also a benefit for your approval procedure.
Kona Ice Profit & Revenue
| Income Type | Amount |
|---|---|
| Revenue | $24,408,838 |
| Cost of Goods Sold by Kona Ice | $11,594,509 |
| Gross Profit | $12,814,329 |
| Selling, General and Administrative Expenses | $10,019,654 |
| Other Net Income | $240,752 |
| Protection Program Forgiveness Paycheck | $676,700 |
| Interest Income | $387 |
| Property & Equipment Gain on Sale | $4,504 |
| Interest Expense | $200,357 |
| Bad Debt Recovery Expenses | $115,829 |
| Selling, General, and Administrative Expenses | $597,149 |
| Income Before Income Taxes | $3,391,824 |
| Current | $767,799 |
| Deferred | $42,378 |
| Other Total Income Expenses | $726,421 |
| Net Income | $2,665,403 |
Kona Ice Training and Support
The owner or the designated manager of the store must complete a set of training offered by Kona Ice before the store can start operating.
The initial training program is called “Kona Kollege.” This program consists of 16 to 20 hours of on-the-job training at the headquarters in Florida. There might be additional courses if Kona Ice seems necessary.
Kona Ice has a team of staff to support the franchisees, including having conventions, marketing support, and preparing the online platform.
There is an entirely separate department to help franchisees with their marketing efforts.
Kona Ice Terms of Agreement and Renewal
The initial franchise agreement with Kona Ice is for ten years. After the initial ten years, a renewal might be possible if both of the sides are in good condition.
In addition, you must not also breach any term of the initial agreement, and the franchisor should be happy with you.
If these are in order, the franchisee has the option to apply for two terms of 10 years as a renewal.
Kona Ice Obligations and Restrictions
Kona Ice franchisees are obligated to pay between $3,000 to $4,000 each year to the franchisor as part of the royalty fee.
The franchise owner has to be present in the franchise’s daily operations for the first 60 days.
In certain cases, the owner can appoint a designated manager after these 60 days with written approval from the franchisor.
Kona Ice Financial Assistance
Kona Ice offers indirect financing through a third-party financial service. This financial service offers partial financing to cover some equipment, truck, kiosk, or the initial inventory.
Kona Ice’s website state that the term is fixed, which is 60 months at 8.99%. However, this depends on the credit approval and whether you will be eligible to get it or not.
Kona Ice Comparison
| Name | Franchise Fee | Royalty Fee | Initial Investment |
|---|---|---|---|
| Bahama Bucks’ | $34,500 | 6% | $308,700-$966,338 |
| Rita’s Italian Ice | $35,000 | 6.5% | $278,333-$624,695 |
| Kona Ice | $15,000 | $3,000-$4,000/year | $167,115-$212,100 |
Conclusion
Kona Ice is one of the low-end franchises that doesn’t require a lot of investment to open.
You need between $167,115 to $212,100 to open a Kona Ice franchise which includes the $15,000 franchise fee.
Kona Ice is an attractive opportunity with over 1,500 outlets and a cheap price tag. You should definitely consider owning one if you are interested.
Also, if you are looking to own the best franchise under $50k, then the Kona Ice franchise is the best option.
FAQ
Is Kona Ice a franchise?
Yes, Kona Ice is currently a franchise offering opportunities to those interested. You can apply to be a Kona Ice franchisee through their website easily.
How much is the franchise fee for Kona Ice?
The franchise fee is $15,000. You must pay this fee in a lump sum before you start preparing your store.
What do I need to be a Kona Ice franchisee?
If you have the finances to cover the initial investment and the franchise fee, you only need to possess the professional background they require. This includes a background as an owner or a manager.
Sources
https://en.wikipedia.org/wiki/Kona_Ice
Amit Gupta is an experienced expert in digital marketing and co-founder of DrFranchises. With more than 11 years of knowledge in franchise digital marketing, SEO, email marketing, and social media marketing, Amit has helped many brands achieve incredible success online. As a passionate entrepreneur and owner of 7 franchises, he continues to study franchise models, looking at costs, revenue, and profitability to guide brands toward profitable growth. When he’s not working on digital marketing, Amit enjoys spending time playing with his beloved dog.