About Kilwins Franchise
Kilwins franchisees operate a retail confectionery and ice cream store, either a full-line Kilwins Chocolates, Confectionery & Ice Cream Store or a smaller-format Kilwins Ice Cream & Chocolate Shop.
Day-to-day operations involve selling premium handcrafted chocolates, Kilwins brand original recipe ice cream, fudge, candy, nuts, beverages, and other confections.
Many products are made in-store according to approved recipes using approved ingredients.
Kilwins Franchise Cost & Fees
Minimum Investment
$393K
Average Investment
$526K
Maximum Investment
$660K
| Fee Type | Amount | Notes |
|---|---|---|
| Initial Franchise Fee | $40,000 | One-time payment upon signing |
| Royalty Fee | 5% of Gross Sales of gross sales | Ongoing; paid monthly |
| Marketing/Ad Fund | 1% of Gross Sales to National Marketing Fund | National brand fund |
| Total Investment Range | $392,500 – $659,500 | Includes build-out, inventory, working capital |
The investment range of $393K–$660K reflects variability in build-out costs, store size, lease terms, and market. The combined royalty (5% of Gross Sales) and marketing fee (1% of Gross Sales to National Marketing Fund) are ongoing costs paid as a percentage of gross sales.
Investment Breakdown (Item 7)
| Item | Low | High |
|---|---|---|
| Initial Franchise Fee | $35,000 | $40,000 |
| Lease/Rent (one month) | $3,500 | $15,000 |
| Plans and Construction (includes architectural and building permits) | $150,000 | $275,000 |
| Store Construction Oversight & Review Fee | $5,000 | $5,000 |
| Equipment | $55,000 | $110,000 |
| POS System | $5,000 | $10,000 |
| Inventory (opening) | $25,000 | $40,000 |
| Signs and Awnings | $10,000 | $35,000 |
| Advertising (Grand Opening) | $5,000 | $5,000 |
| Insurance (annual premium) | $3,000 | $8,000 |
| Training Expenses | $3,000 | $10,000 |
| Business Licenses | $500 | $3,000 |
| Professional Fees | $2,000 | $10,000 |
| Additional Funds (3 Months) | $45,000 | $75,000 |
| Security Deposits | $500 | $3,000 |
Additional Fees (Item 6)
| Fee Type | Amount |
|---|---|
| Transfer Fee | $30,000 or 75% of then-current initial franchise fee, whichever is more |
| Renewal Fee | $10,000 or 25% of then-current initial franchise fee, whichever is greater |
| Technology Fee | $300 per month per Store (subject to increase) |
| Audit Fee | All costs and expenses associated with the audit, per diem expenses, reasonable accounting and legal costs, and interest on underpayment (if audit triggered by failure to submit financial information timely or if sales underreported by 2% or more) |
| Regional Fund | 1% of Gross Sales (if Regional Fund is established for your area; may be increased up to an additional 2% by majority vote of store owners in the Regional Fund) |
| Local Marketing Expenditure | 2% of Gross Sales |
| Interest on Overdue Payments | 18% per year on the underpayment |
| Replacement Training | $5,000 for each replacement training session, plus per diem expenses and travel expenses |
| Additional Individuals for Initial Training | $5,000 for each individual over the first four individuals |
| Web-based Employee Training | Up to $10 per employee per month |
| POS Support Fee | $150 per month per Store (subject to change) |
| Recurrent Inspection | $500/day plus expenses (charged only when additional trips are necessary to correct a violation) |
| Sale of Store Sales Fee | Up to 10% of the sales price of the Store (optional service) |
| Insurance Surcharge | 10% surcharge on premiums if franchisor obtains coverage on your behalf |
| Relocation Expenses | Franchisor's actual costs for travel, lodging, meals, and legal fees related to reviewing and approving relocation |
| Lost Future Royalties | Average monthly royalty fees for previous 12 months multiplied by lesser of 36 or months remaining in term (payable upon termination for default or abandonment) |
| Costs and Attorneys Fees | Variable; if franchisee is in violation or franchisor must enforce the agreement, includes per diem, employee costs, travel, and reasonable attorneys fees plus 10% surcharge |
| Securities Offering Fee | $5,000 or actual expenses, whichever is greater |
| Indemnification | Variable under circumstances |
Training Program (Item 11)
| Detail | Information |
|---|---|
| Total Duration | Store: Minimum 20 days (14 days at headquarters plus 6 days at franchisee's Store). Shop: Minimum 10 days (6 days at headquarters plus 4 days at franchisee's Shop). Each day consists of a minimum of 8 hours. Training must be completed at least 7 days before opening. |
| Classroom Training | Approximately 48 hours for Store; approximately 32 hours for Shop |
| On-the-Job Training | Approximately 112 hours for Store; approximately 48 hours for Shop |
| Training Location | Petoskey, Michigan (Session 1 at headquarters) and at franchisee's Store/Shop location (Session 2) |
| Additional Training | Ongoing training provided periodically as franchisor deems appropriate. Highly Trained Personnel may be required to attend refresher courses, seminars, and other training programs. Web-based employee training may be required (up to $10/employee/month). Additional on-site training available upon request at $500/day plus expenses. Tom Kollar, Vice President of Franchise Relations, supervises the initial training program. Training subjects include Background & History, Kilwins Philosophy, Operations Manual, Pre-Opening Activities, General Operations, Employee Orientation, Management Training, Production Training, Made-in-Store Products, Ordering & Delivery, Marketing, Building Your Team, Budgeting, Merchandising, Selection & Pricing, POS System Training, Daily Store Operations, Store Setup, and Support as You Train Your Team. |
Territory Rights (Item 12)
| Detail | Information |
|---|---|
| Territory Type | Protected |
| Exclusive Territory | No |
| Territory Size | Varies; typically a circle with center at the front door of the Store with a radius specified in the Franchise Agreement. There is no minimum Protected Territory. |
| Description | The franchisor will not establish or license another Kilwins Store within the Protected Territory during the term of the agreement. However, the franchisor retains extensive rights including: operating or licensing Stores at any location outside the Protected Territory regardless of proximity; acquiring or being acquired by any business inside or outside the territory; selling and distributing Kilwins products through supermarkets, gourmet shops, specialty shops, convenience stores, mail order, internet, and other channels; operating kiosks and Major Events inside the territory (with right of first refusal offered to franchisee); and delivering products into the territory from other Stores. Franchisees may only advertise and solicit customers within their Protected Territory and may not sell via electronic media, phone, catalogs, or direct mail. The territory cannot be modified so long as franchisee stays in compliance. |
Renewal, Termination & Transfer (Item 17)
| Detail | Information |
|---|---|
| Initial Term | 10 years |
| Renewal Term | One additional 10-year term |
| Renewal Fee | $10,000 or 25% of then-current initial franchise fee, whichever is greater |
| Renewal Conditions | Written notice required not less than 6 months nor more than 12 months before end of Initial Term. Must be in material compliance with all provisions. Must have satisfied all monetary obligations. Must renovate and modernize the Store to then-current standards. Must upgrade computer hardware and software to then-current standards for new Stores. Must sign then-current form of franchise agreement (which may contain materially different terms including smaller Protected Territory and higher royalty/marketing fees). Must execute general release. Must comply with then-current qualification and training requirements. Must demonstrate continuing right to retain possession of premises for entire renewal term. No renewal right for a Shop Addendum. |
| Transfer Fee | $30,000 or 75% of then-current initial franchise fee, whichever is more. Payable as $10,000 at time of written notice of intended transfer and remaining $20,000 or higher amount on or before franchisor provides written approval. |
| Transfer Conditions | Franchisor must approve all transfers. Conditions include: upgrading Store to then-current standards if requested, execution of general release by transferor, transferee must meet franchisor's qualifications and standards, change of control may require signing then-current franchise agreement, transferor remains liable for pre-transfer obligations, at least one transferee principal must complete training, franchisor has right of first refusal to purchase on same terms within 45 days, transferor bound by non-compete and confidentiality covenants post-transfer, new Lease Addendum required if lease transfers. |
| Termination for Cause | Immediate termination without opportunity to cure for: insolvency/bankruptcy, failure to construct and open within time limits, abandonment or cessation of operations, conviction of felony or crime of moral turpitude, threat to public health or safety, unauthorized transfer, violation of non-compete covenants, disclosure of confidential information, failure to transfer interest upon death/incapacity within required time, default under other franchise agreements, repeated defaults within 12 months, purchasing from unapproved suppliers or selling unapproved products after notice, maintaining false books or submitting false reports, unauthorized manufacturing of Designated Products, sales understatement of 4% or more. For curable defaults: 30 days written notice with opportunity to cure. |
| Non-Compete Period | 2 years after expiration or termination |
| Non-Compete Details | During the term, no geographic limitation on non-compete restrictions. During the 2-year post-term period, restrictions apply within 10 miles of the Approved Site and within 10 miles of any then-existing Kilwins Store. Competitive Business is defined as any business that offers for sale chocolate, fudge, candy, popcorn-based products, ice cream, and/or other frozen dessert products. Prohibits diverting business or customers, owning/operating/engaging in any Competitive Business, and selling inventory, supplies, furniture, fixtures, or equipment to any Competitive Business. Additionally, for 2 years post-term, franchisee may not sell, assign, lease, or transfer the Approved Site to anyone known to intend to operate a Competitive Business at that site. |
Operations & Supply (Items 8 & 15)
| Detail | Information |
|---|---|
| Owner-Operator Required | No |
| Participation Details | The Franchise Agreement does not require the franchisee to participate personally in the direct operation of the Store, although active participation is encouraged and recommended. One Highly Trained Personnel individual (the franchisee, the Operating Partner, or the Franchised Business Manager) who has successfully completed the franchisor's training program must always be in active management of the Franchised Business. If the franchisee is an entity, all owners and their current and future spouses must sign a personal guarantee of the franchisee's obligations. The on-premises supervisor is not required to have an equity interest in the franchisee entity. |
| Required Suppliers | Franchisees must purchase all chocolate candy products and ice cream products from the franchisor's affiliate, Kilwin's Quality Confections, Inc. All packaging, napkins, bags, ice cream cones, boxes, cups, dishes, uniforms, product display fixtures, risers, trays, easels, cases, holders, tablecloths, and beverage ice coolers must be purchased from the franchisor, its affiliates, or approved suppliers. The proprietary Kilwins POS software must be purchased from the franchisor. POS hardware must be purchased from the authorized hardware supplier (currently GR Software). |
| Supply Restrictions | Approximately 90% to 100% of total purchases in establishing a Store and approximately 85% to 95% of continuing purchases must come from approved suppliers or in accordance with franchisor specifications. Franchisees may not make, offer, or sell any products not approved in writing by the franchisor. If franchisee wants to buy from an unapproved supplier, a written request must be submitted and the franchisor has the right to inspect the supplier's facilities and test samples. Approval response anticipated within one to six months. |
| Franchisor Revenue from Suppliers | Kilwin's Quality Confections derives revenue from franchisee purchases of ingredients, products, and ice cream. During fiscal year ended December 2022, Quality Confections received revenue from franchisee purchases representing approximately 95% or more of Quality Confections' total revenues. The franchisor also received revenue from sale of POS software to franchisees and from sale of used equipment. Neither the franchisor nor its affiliates currently receive rebates, commissions, or reduced prices from other suppliers based on franchisee purchases, although they may do so in the future. |
Financing (Item 10)
| Detail | Information |
|---|---|
| Financing Available | No |
| Description | Kilwins does not offer direct or indirect financing. Kilwins does not guarantee franchisee notes, leases, or obligations. |
Kilwins Franchise Earnings — Item 19
Average Revenue
$921K
Sample Size
140 units
Past financial performance does not guarantee future results. Individual results will vary.
Kilwins Litigation & Risk Flags
Clean Litigation RecordKilwins has no pending litigation actions listed in their FDD. There is also no bankruptcy history disclosed.
Litigation and bankruptcy data is sourced from Items 3 and 4 of the FDD. Always verify current status directly from the most recent FDD.
Kilwins System Growth
Total Units
149
Franchised
145
Company-Owned
4
Kilwins currently operates 145 franchised locations and 4 company-owned units. Unit count data is sourced from Item 20 of the FDD.
Unit History (Item 20)
| Year | Opened | Closed | Total |
|---|---|---|---|
| 2020 | 9 | 2 | 138 |
| 2021 | 13 | 5 | 146 |
| 2022 | 9 | 10 | 145 |
Transfers: 8 | Closures: 10
State Registrations
Registered in 10 states: IL, IN, MD, MI, MN, NY, RI, SD, VA, WI
Franchisor Financials (Item 21)
Revenue
$13.9M
Net Income
$1.7M
Total Assets
$11.5M
Audited by Beene Garter, A Doeren Mayhew Firm for year ending December 31.
Kilwins Franchise — FAQ
The total investment to open a Kilwins franchise ranges from $392,500 to $659,500, per their Franchise Disclosure Document. This includes the initial franchise fee of $40,000. The investment covers build-out, inventory, equipment, signage, working capital, and other startup costs.
Kilwins charges a royalty fee of 5% of Gross Sales of gross sales, plus a 1% of Gross Sales to National Marketing Fund contribution to the marketing/advertising fund. These fees are paid on an ongoing basis.
You can download the Kilwins Franchise Disclosure Document free on this page. The FDD is a public document filed with state franchise registries. Always also request the current FDD directly from Kilwins to ensure you have the most up-to-date version.
According to the Item 19 financial performance representation in their FDD, Kilwins franchise owners report average revenue of $921K. This is based on a sample of 140 units. Past performance does not guarantee future results.
Kilwins has been franchising since 1981. The FDD shows an investment range of $392,500-$659,500, a 5% of Gross Sales royalty, and includes an Item 19 earnings disclosure. There is no pending litigation. Review the full FDD and contact current franchisees listed in Item 20 before making any investment decision.
The franchise fee is $40,000 and the total investment ranges from $392,500 to $659,500 depending on location size and market. Contact the franchisor directly for current net worth and liquid capital requirements, territory availability, and application details.
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Data Source & Disclaimer: This website is for informational purposes only. It is not an offer to sell or buy a franchise. This profile is based on publicly available FDD data sourced from state franchise registry filings. All information is for research purposes only and does not constitute legal, financial, or investment advice. Data may be outdated or contain errors. Always obtain the current FDD directly from Kilwins and consult a qualified franchise attorney before making any investment decision. FranchiseOverview.com is operated by Franchising Compliance, LLC and is not affiliated with Kilwins or any of its subsidiaries. To report an inaccuracy: info@franchiseoverview.com