Dippin’ Dots Franchise Costs, Fees & FDD

Year Business Began: 1988

Franchising Since: 1999

Headquarters: Paducah, Kentucky

Estimated Number of Units: 260

Franchise Description: Dippin’ Dots Franchising, L.L.C. is the franchisor. Dippin’ Dots franchises sell Dippin’ Dots branded novelty frozen ice cream, yogurt, sherbet and ice products. The franchisor offers the opportunity to operate a Dippin’ Dots franchised business in one of the following models: (1) a territory franchise, (2) a store only franchise, or (3) a distribution franchise.
Training Overview: The franchisor will provide basic management training for up to two trainees during a four-day training period (minimum of seven hours per day) at its offices or a designated Dippin’ Dots business. Unless otherwise agreed in writing, franchisees (or, if the franchised business is not owned by an individual, the principal owner) must be one of the trainees. All trainees must satisfactorily pass the basic management training test to the franchisor’s satisfaction. The franchisor will provide franchisees with opening support, if it is deemed necessary, for up to two days to assist in the opening of the Dippin’ Dots franchise. The franchisor may provide refresher or additional training programs, seminars or advanced management training for franchisees and their employees at its principal training facility (or any other location it designates provided the other location is closer to the franchised business).

Territory Granted: Franchisees will not receive an exclusive territory. The franchise granted to franchisees will permit them to sell Dippin’ Dots products within a specified territory based on the model they are operating. Except for the possible operation of Doc Popcorn franchises (wholly owned subsidiary of the franchisor’s), neither the franchisor nor any of its affiliates operate or plan to operate or franchise businesses under a different trademark that will sell similar goods or services to those franchisees are selling. The size of each franchisee’s territory is not uniform and will depend on many factors such as location, population density, consumer median income in the territory, the franchisee’s financial resources, and the franchisee’s proximity to other franchisees or other sales avenues. The minimum territory that any Dippin’ Dots franchisee purchasing a territory franchised business or store only franchised business would be granted would be a territory consisting of the shopping mall or general shopping center in which the fixed location retail store is located. The franchisor will not grant a minimum territory for distribution only franchised businesses. The franchisor will not solicit or make sales or permit any other person to solicit or make sales of any Dippin’ Dots products within the territory, so long as the franchisee meets the performance requirements set forth in a performance plan mutually agreed upon by the franchisor and the franchisee.

Obligations and Restrictions: The franchised business must be directly supervised by an on-site manager who has successfully completed the basic management training program (the manager). The manager is expected to devote his or her best full-time efforts to the management and operation of the franchised business. The manager is not required to have any equity interest in the Dippin’ Dots franchise. The manager cannot have an interest or business relationship in any business competing with DDL, DDF or its franchisees. Any replacement or additional managers are required to complete basic management training before managing the Dippin’ Dots franchised business, unless the franchisor otherwise agrees in writing. Franchisees must offer and sell all goods and services that the franchisor requires for all franchisees. Franchisees must keep the franchised business open and in normal operation for the minimum hours and days as the franchisor requires in the manual or otherwise in writing except as may be limited by local governmental regulations or the landlord of the premises’ rules and regulations. Franchisees must not allow the use of the premises for any other purpose or activity at any time without first obtaining the franchisor’s written consent. Franchisees must not offer any goods or services without the franchisor’s written consent.

Term of Agreement and Renewal: The length of the initial franchise term is five years. Franchisees may renew the term of this agreement for two additional consecutive terms of five years each, if they are in good standing and satisfy certain conditions set forth in the Franchise Agreement.

Financial Assistance: The franchisor does not offer direct or indirect financing. The franchisor does not guarantee a franchisee’s note, lease or obligations. If franchisees are a current member of the U.S. armed forces or an honorably discharged U.S. Veteran and have provided sufficient proof of the same in the form as the franchisor may reasonably require, it will offer a 15% discount off the initial franchise fee.

Estimated Initial Investment

Name of Fee	Low	High
Initial Franchise Fee	$25,000	$35,000
Grand Opening Advertising Materials Expenditure	$500	$2,500
Office and Retail Supplies	$100	$500
Opening Inventory	$2,500	$5,250
Insurance	$1,500	$2,500
Printing and Signage	$499	$5,000
Equipment (freezers, etc.)	$20,000	$84,900
Leased Warehouse and Cold Storage	$2,500	$20,000
20 Ft. Box Truck Monthly Payments to Lease or Own	$1,000	$2,000
Travel, Lodging, Meals, Etc. for Initial Training	$1,500	$2,500
Real Estate and Improvements	$0	$120,000
Security Deposit and Prepaid Rent	$500	$10,000
Miscellaneous Start-Up Costs	$12,500	$45,000
Additional Funds (6 months)	$10,250	$63,500
ESTIMATED TOTAL	$79,349	$398,650

 
Other Fees

Type of Fee	Amount
Royalty Fee	$2.16 per gallon for bulk ice cream products. $0.09 per unit for prepack units. Up to 6% on ancillary items (non-Dippin’ Dots manufactured retail food, drink and/or nonfood approved items).
Advertising Fund Contributions	$0.24 per gallon for bulk ice cream products. $0.01 per unit for prepack units. Up to 2% on ancillary items (non-Dippin’ Dots manufactured retail food, drink and/or non-food approved items).
Regional Advertising Fund Contributions	Up to 50% of the contributions made to advertising fund.
Additional Training Fees	Then-current fee, currently, $500 per day per person, plus travel and living expenses for the franchisor’s personnel.
Relocation Fee for Relocation of Franchised Business	$1,000
Ongoing Purchase of Products to Be Sold or Offered for Sale at the Franchised Business	Varies.
Evaluation and Testing of New Approved Supplier	Reasonable cost of the evaluation and testing.
Reimbursement of Amounts Paid to Correct Any Deficiencies	Actual cost to franchisor.
Replacement Fee for Lost Manuals	At least $200.
Late Fee for Sales Reports or Profit and Loss Statement	$75 per occurrence.
Interest on Understated Amounts Payable	18% per annum or the maximum rate permitted by law, whichever is less.
Reimbursement of Audit Costs	Actual cost to franchisor.
Insurance Coverage	Actual cost to franchisor.
Late Fee for Certificates of Insurance	$75 per week.
Transfer Fee	The lesser of $15,000 or 10% of the sales consideration plus any attorney fees incurred by the franchisor in connection with its review of and processing of the transfer. $1,000 plus any attorney fees incurred by the franchisor in connection with its review of and processing of the transfer to add a minority shareholder, partner, member or owner. For existing Dippin’ Dots franchisees transferring their interests to an existing Dippin’ Dots franchisee: The lesser of $1,000 or 10% of the sales consideration per franchise sold plus any attorney fees incurred by the franchisor in connection with its review of and processing of the transfer.
Renewal Fee	$7,000 for territory franchised business. $3,000 for store only franchised business. $5,000 for distribution franchised business.
Fee to Add Minority Equity Owner	$1,000
Damages, Costs and Expenses Upon Default	Actual damages, costs and expenses, including reasonable attorneys’ fees, incurred by the franchisor as a result of the default.
Indemnification	Actual cost to franchisor.
Fee for Infringement of Rights of Other Franchisee or customer of DDL	$1,000 for freezer placements (FDMC channel, food, drug, mass convenience/club). Fairs, festivals, events; $2,500 for first breach. $2,500 for subsequent breaches.
Franchisee Council Membership Dues	$100 per year.

The above information has been compiled from the FDD of Dippin’ Dots. Year of FDD: 2025.
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