Kona Ice Franchise Costs, Fees & FDD

Year Business Began: 2008

Franchising Since: 2008

Headquarters: Florence, Kentucky

Estimated Number of Units: 1,820

Franchise Description: Kona Ice, Inc. is the franchisor. The franchisor offers franchises for the use of its “Kona Ice” trademarks, trade names, service marks, and logos for the operation of Kona Ice businesses. Kona Ice businesses provide flavored shaved ice, ice cream, and related products to the general public in a mobile environment, which includes the franchisor’s proprietary Kona Ice truck, known as the Kona Entertainment Vehicle (KEV) with the patented “FlavorWave Self-Service System.”
Training Overview: The managing owner and any designated manager or representative that the franchisor requires must complete the training program to its reasonable satisfaction before franchises open their Kona Ice franchise. Franchisees will be enrolled in the initial training program which the franchisor calls “Kona Kollege.” Franchisees that purchase existing Kona Ice franchises as a result of a transfer are also required to attend Kona Kollege. Kona Kollege currently consists of 14 hours of classroom training and 10 hours of on-the-job training at the franchisor’s corporate office in Florence, Kentucky. The franchisor may require that franchisees, designated managers, and other employees attend system-wide refresher or additional training courses. Some of these courses may be optional, while others may be required.

Territory Granted: The Franchise Agreement for the Kona Ice business grants franchisees an exclusive territory based on the geographic area and population properties within that area and other relevant demographic characteristics. The franchisor will generally grant only one license to a franchisee for any area with a population up to 100,000. In certain densely populated metropolitan areas, a territory may be considerably smaller, while franchisees operating in less densely populated urban areas may have significantly larger areas. If the population of the protected territory increases by more than 25%, the franchisor may reduce the size of the protected territory to 100,000 people unless the franchisee purchases an additional KEV. With limited exceptions, while the Franchise Agreement is in effect and franchisees are not in default, the franchisor and its affiliate will not, in the protected territory, operate a company-owned unit or grant a franchise for a similar or competitive business.

Obligations and Restrictions: Franchisees are required to own their Kona Ice franchise in a legal entity. The Kona Ice franchise shall be managed by one of the owners who is a natural person with at least a 51% ownership interest and voting power in the entity (referred to as the managing owner). The franchisor requires franchisees to be an active owner and operator of the Kona Ice business for at least the first 60 days that they operate as a Kona Ice franchisee. Under certain circumstances, after the first 60 days of operation, the franchisor may allow franchisees to appoint a designated manager, who has been approved by the franchisor, to run the day-to-day operations of the Kona Ice business. Franchisees are required to offer for sale only products and services that have been approved and specified by the franchisor in its brand manual and any updates that are incorporated in the brand manual.

Term of Agreement and Renewal: The length of the initial franchise term is 10 years. If franchisees are in good standing and they meet other requirements, they may apply for two successive terms of 10 years.

Financial Assistance: At their sole discretion, and if they qualify, specified third-party lenders may offer franchisees financing for the purchase of their KEV; KEV 2.0 Truck, kiosk, mini or trailer; and/or initial inventory. Except as stated, neither the franchisor, nor any agent or affiliate of its offers direct financing. The franchisor does not guarantee a franchisee’s note, lease, or obligation.

Estimated Initial Investment

Name of Fee	Low	High
Initial Franchise Fee	$15,000	$15,000
KEV and Installed Equipment	$151,491	$157,491
Training Expenses	$140	$950
KEV Delivery	$0	$10,000
KEV Compliance Fee	$0	$7,000
KEV Insurance for 3 Months	$1,000	$2,100
Tax, Title, and Licensing of KEV	$1,000	$8,000
Initial Inventory	$9,975	$9,975
Optional Inventory	$0	$225
Permits and Licenses	$250	$1,500
Real Estate or KEV Storage	$0	$4,000
Computer System and Hardware	$0	$1,000
Additional Funds – 3 Months	$0	$9,600
ESTIMATED TOTAL	$178,856	$226,841

 
Other Fees

Type of Fee	Amount
Royalty	$3,000 for years one and two, $4,000 for years three through six, $5,000 for years seven through ten.
Additional Equipment Royalty	Varies based on the type of additional equipment (currently $1,500 to $2,500 per year).
Additional Franchise Reservation Fee	$10,000 per territory.
Territory Infringement Fee	$1,000 plus amount of applicable products and services the franchisee invoiced while infringing for first violation; $5,000 plus amount of applicable products and services the franchisee invoiced while infringing 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 for KEVs and KEV 2.0 trucks, and an additional $200 per year for any additional equipment franchisees operate.
Unauthorized Advertising Fee	$500 per occurrence.
Additional Training	The then-current fee (currently not charged) plus costs and expenses.
Kona Email Address Fee	$216 per email address per year or $18 per month.
Google Voice Fee	$192 per Google Voice number per year or $16 per Google Voice number per month.
Technology Fee	The then-current fee (currently $600 per year).
KonaOS Business Management Software Fee	Then current price (currently $35 per month per KEV; $20 per month for every ancillary unit you operate).
Insurance	Reimbursement of the franchisor’s 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 4% 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	Varies under circumstances.
Professional Fees and Expenses	Will vary under circumstances.
Renewal Franchise Fee	$7,500
Transfer Fee	$5,000 to $7,500 plus $1,000 for each piece of additional equipment.
Additional Equipment Transfer Fee	$1,000 per additional equipment.
KEV Remodel or KEV Upgrades or KEV 2.0 Truck	Will vary under circumstances.
KEV Recovery Fee	Reimbursement of the franchisor actual costs, plus a 20% administration charge.
Mystery Shopper Fee	$1,000 per occurrence.
Monitor Content Management Software Fee	Then-current fee. (Currently $240 per year per monitor.)
Document Fee	$250 per document.
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).
Branded Cup Audit Fee	$3,000
Optional E-Lead Program Fee	$250 or $500 per year.
Limited Time Offer Campaign Fee	Then-current fee (currently $99 per kit).
Conference Fee	Then-current fee.

The above information has been compiled from the FDD of Kona Ice. Year of FDD: 2025.
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