Ritas Italian Ice
Ritas Italian Ice offers Italian ice, frozen custard, and other treats in standard or express shop formats. Known for its variety of flavors, the brand operates in the quick-serve frozen dessert industry.
Ritas Italian Ice franchise FAQ
How much does it cost to open one — the total initial investment?
The total initial investment necessary to begin operation of a standard Rita's shop without a drive-thru is between $315,233 and $770,542, while for a standard Rita's shop with a drive-thru, it ranges from $456,858 to $905,536. For an express Rita's shop, the total investment is between $199,005 and $558,504 [p.1].
What is the initial franchise fee?
The initial franchise fee is $35,000 and it is non-refundable [p.157, p.17]. This fee is paid in consideration for the right to develop, open, and operate the shop using the company's proprietary marks and system [p.89].
What are the ongoing royalty and advertising fees?
The ongoing royalty fee is 6.5% based on the estimated gross sales from menu items purchased from the franchisor [p.21, p.291]. Additionally, you must contribute to an Advertising Obligation each year during the term of the Franchise Agreement, which includes contributing to a Branding Fund and potentially spending on local advertising and promotion [p.39].
How long is the initial franchise agreement, and can I renew it?
This isn't specified in the excerpts.
Can I sell or transfer my franchise, and what does that require?
According to the FDD, the franchisor can refuse to permit a transfer of ownership of a franchise except for good cause [p.5]. Good cause includes but is not limited to unspecified factors. This means there are specific reasons why the franchisor might deny a transfer request, though these reasons are not detailed in the provided excerpts.
On what grounds can the franchisor terminate the agreement?
The franchisor can terminate the franchise agreement if you fail to comply with any lawful provision in the franchise agreement and do not cure such failure within a reasonable time, which cannot exceed thirty (30) days [p.5(c)]. Additionally, the franchisor is permitted to refuse renewal on terms generally available to other franchisees under similar circumstances, though this does not require a renewal provision [p.5(e)].
What financial requirements — net worth and liquid capital — do I need to qualify?
This isn't specified in the excerpts. The FDD does not provide specific details on the net worth or liquid capital required for qualification as a franchisee. However, it does mention that if the franchisor's most recent unaudited financial statements show a net worth of less than $100,000, they must arrange for the escrow of initial investment funds until obligations are fulfilled [p.6]. Additionally, you need to demonstrate your financial ability to open and operate each Shop as part of the pre-opening requirements [p.207], and you will be solely responsible for obtaining funding or financing for your Franchised Business [p.327].
Do I get an exclusive or protected territory?
No, you do not receive an exclusive or protected territory. This isn't specified in the excerpts for both the standard Rita's Shop and the Satellite Shop. The FDD indicates that while a territory is provided, it does not grant exclusivity against other franchisees or company-owned outlets [p.49, p.50, p.193]. Additionally, the Satellite Shop also explicitly states no protected area or territory is granted [p.186].
What training and ongoing support does the franchisor provide?
The franchisor provides initial training that includes instruction at Rita's Online University, Cool University, and a Certified Shop. This training is conducted under the supervision of their Senior Vice President of Operations, Kathy Deal, who has extensive experience in food service. Ongoing support includes remote training options via Rita’s Online University and on-site opening assistance when you open the shop. However, the franchisor does not provide any specific training or assistance related to compliance with the Fast Food Act; this responsibility lies solely with the franchisee [p.332].
How many franchised outlets are there, and how many have closed or been terminated?
This isn't specified in the excerpts.
Does the franchisor share any financial performance or earnings information?
Yes, the franchisor may provide financial performance information if there is a reasonable basis for it. This can include actual records of existing outlets you are considering purchasing [p.67], but the franchisor does not own any shops and has not independently verified the sales information used in the financial performance representation [p.66]. Written substantiation will be made available upon request [p.67].
What am I restricted to selling, and where must I buy supplies?
You are required to sell the full assortment of Menu Items designated for Standard Shops or Express Shops as per their respective shop types [p.3]. Additionally, you must purchase all Products from manufacturers, distributors, and suppliers approved by the franchisor, who will ensure these meet the System Operating Standards [p.31]. You must buy all necessary supplies, products, and services required for your Shop from suppliers designated or approved in writing by the company [p.99].