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How Much Does It Cost to Open Sub Zero Ice Cream Franchise?

If you are looking towards opening a Sub Zero Ice Cream Franchise, it will be nice for you to have a preview of what the company represents before going ahead to enquire about the total cost of opening the franchise in your location. Sub Zero Ice Cream was founded in 2004 and they began franchising in 2005, about 15 Years ago. Jerry Hancock is the Founder and CEO and they have their corporate head office at 62 W. Center Provo, UT 84604, USA. Presently, the brand has spread to over 56 locations throughout the United States.

Jerry Hancock used his background in chemistry to develop a method of flash-freezing ice cream using liquid nitrogen. He and wife Naomi opened the first Sub Zero Ice Cream in Orem, Utah, in 2004, using this technology to offer customers the chance to customize their ice cream by choosing their milk base, flavors, mix-ins and texture. Sub Zero also offers a liquid nitrogen science education program that can be brought to schools.

Sub Zero offers customers the chance to customize their ice cream by choosing their milk base, flavors, mix-ins and texturea. The first Sub Zero Ice Cream was opened in Orem, Utah, in 2004, by Jerry and Naomi Hancock. The company provides 25 percent franchise fee discount for honorably discharged veterans.

Each franchisee has the capability to cater events and perform school presentations. The combination of ice cream and science create a memorable experience for everyone involved in the process. Sub Zero also caters to most allergies and sensitivities. This unique custom-made process can please any customer.

Here are areas where you are expected to spend money and the cost associated with it;

  1. Initial Franchise Investment: $219,450 to $475,500

Please note that typical start-up cost to open store: $219,450 to $475,500. Sub Zero Ice Cream disclosure document details this and breaks down the expenses and the Average store size is 1200 sq. feet

  1. Franchise Fee: Sub Zero franchise fees: $35,000 including mobile, but a traditional or kiosk location is also required.
  2. Franchise Royalty Fee: 6 percent of net sales and National advertising fee: 2 percent of net sales and the Due Date for this fee is Paid by electronic funds transfer every Friday for the preceding Reporting Period. The amount of the Royalty Fee for any renewal term will be that provided in the Franchise Agreement executed for such renewal term.

Please note that “Net Revenues” include all revenues generated from the provision of any and all services and/or the sale of any and all products and, whether by the franchisee or a third-party provider, that relate to or arise from the Franchised Business. It does not include taxes collected from customers.

  1. Local Advertising Spend, Local Marketing Fund, or Cooperative Advertising Contribution: At least 1 percent per calendar year and the Due Date: for this is Monthly.

Please note that Sub Zero Ice Cream has a full-time marketing staff that designs professional advertising pieces and in-store promotions, manages all aspects of social media and public relations development, and handles web development to ensure that online presence is always available and professional. This way the Sub Zero brand identity always stays consistent.

If the company-owned Centers comprise the majority of a given Cooperative, the maximum and minimum fees for that Cooperative will be consistent with the range stated in this Item 6.

  1. Liquidated Damages Under Area Development Agreement: This fee varies but the Due Date is Payable within 30 days of the termination of the Development Agreement.
  2. Audit Costs: All costs and expenses associated with the audit, reasonable accounting and legal costs.
  3. Indemnity: This fee will vary under the circumstances and the Due Date is As incurred.

Please note that you must reimburse Sub Zero Ice Cream if it is held liable for claims arising out of your franchise operations.

  1. Insurance: Reimbursement of costs the franchisor’s out-of-pocket costs.
  2. Equipment, Supply, or Supplier Testing or Inspecting: Fee not to exceed the actual costs of inspecting and testing. (Due Date:  Due on receipt of invoice.)

Please note that This fee covers the cost of testing or inspecting equipment, supplies, or suppliers you propose.

  1. POS Hardware and Software: Depends upon vendor and products purchased. (Due Date:  Depends upon vendor and products purchased.)
  2. Attorneys’ Fees and Costs: Will vary under circumstances. (Due Date:  As incurred.)

Payable to Sub Zero Ice Cream if it is forced to retain independent counsel and seek damages or injunctive relief to enforce the Franchise Agreement (whether or not suit is filed) or if Sub Zero Ice Cream is required to defend your unsuccessful claim against it.

  1. Veteran Incentives: 25 percent off franchise fee
  2. Term of Agreement and Renewal: The length of the initial franchise term is 10 years. If requirements are met, franchisees can renew for one additional term of 10 years.
  3. Financial Assistance: Sub Zero Franchise Inc. offers in-house financing to cover the following: franchise fee. So also, Sub Zero Franchise Inc. has relationships with third-party sources which offer financing to cover the following: startup costs, equipment, inventory, accounts receivable, and payroll amongst others.

In Summary,

  • Initial Investment: $219,450 – $475,500
  • Net-worth Requirement: $300,000 – $1,000,000
  • Liquid Cash Requirement: $75,000 – $1,000,000
  • Ongoing Initial Franchise Fee: $35,000
  • Ongoing Royalty Fee: 6 percent
  • Ad Royalty Fee: 2 percent