About The Original Rainbow Cone Franchise
The Original Rainbow Cone is a beloved ice cream franchise famous for its signature five flavor cone, which stacks chocolate, strawberry, Palmer House, pistachio, and orange sherbet into a single, colorful serving.
The brand is a Chicago institution that has been delighting dessert lovers since 1926, and it began franchising in 2019 to bring this iconic treat to new markets.
The franchise fee is $35,000 for free standing and in line locations, and $20,000 for kiosk formats.
The Original Rainbow Cone Franchise Cost & Fees
Minimum Investment
$82K
Average Investment
$1.5M
Maximum Investment
$2.9M
| Fee Type | Amount | Notes |
|---|---|---|
| Initial Franchise Fee | $35,000 for Free Standing and In-Line, $20,000 for Kiosk | One-time payment upon signing |
| Royalty Fee | 7% of Gross Sales of gross sales | Ongoing; paid monthly |
| Marketing/Ad Fund | Up to 3% of Gross Sales (currently 2%) for Brand Marketing Fund contribution; Minimum of 1% of Gross Sales for Local Advertising | National brand fund |
| Total Investment Range | $82,000 – $2,929,650 | Includes build-out, inventory, working capital |
The investment range of $82K–$2.9M reflects variability in build-out costs, store size, lease terms, and market. The combined royalty (7% of Gross Sales) and marketing fee (Up to 3% of Gross Sales (currently 2%) for Brand Marketing Fund contribution; Minimum of 1% of Gross Sales for Local Advertising) are ongoing costs paid as a percentage of gross sales.
Investment Breakdown (Item 7)
| Item | Low | High |
|---|---|---|
| Initial Franchise Fee | $35,000 | $35,000 |
| Land Acquisition | $300,000 | $800,000 |
| Site Work | $200,000 | $650,000 |
| Construction of Building | $700,000 | $950,000 |
| Travel and Living Costs While Training | $19,100 | $26,200 |
| Initial Inventory and supplies | $10,000 | $15,000 |
| Furniture, Fixtures and Equipment (excluding Sign Package and POS) | $148,000 | $187,000 |
| Sign Package | $63,000 | $77,000 |
| POS System | $8,550 | $10,450 |
| Miscellaneous expenses | $9,000 | $37,500 |
| Grand Opening Advertising and Marketing | $10,000 | $25,000 |
| On-Site Training Fee | $28,250 | $41,500 |
| Additional Funds – 3 Months | $35,000 | $75,000 |
Additional Fees (Item 6)
| Fee Type | Amount |
|---|---|
| Transfer Fee | 75% of the then-current Initial Franchise Fee (new franchisee); 50% of the then-current Initial Franchise Fee (existing franchisee); $1,500 (among existing owners without change in controlling interest) |
| Renewal Fee | $7,500 |
| Technology Fee | Currently $150 per week |
| Audit Fee | Sum equal to the highest rate of interest permitted by law or 1.5%, whichever is lesser, of the understated amount. If understatement exceeds 2%, then cost of audit. |
| Local Advertising | Minimum of 1% of Gross Sales |
| Cooperative Advertising | As determined by a majority of the members of the cooperative |
| Interest on Late Payments | Highest rate of interest permitted by law not to exceed 1.5% per month |
| Service Charges and Non-Sufficient Funds Fee | Currently $250 |
| Customer Satisfaction Reimbursement | Varies under the circumstances |
| Technology Maintenance and Upgrades | $1,200 annually |
| Quality Assurance Audit Fee | Up to $450 per calendar quarter |
| Mystery Shopper Fee | Up to $250 per month |
| PCI DSS Compliance | $125 per month |
Training Program (Item 11)
| Detail | Information |
|---|---|
| Total Duration | Approximately 130-175 hours for restaurant franchises (40 hours e-learning + 90-135 hours on-the-job), plus 24 hours virtual training for Food Truck operations. |
| Classroom Training | 40 hours (E-Learning) |
| On-the-Job Training | 90-135 hours |
| Training Location | Chicago, Illinois, or such other location we may select from time to time for in-person training. Food Truck training is virtual. |
| Additional Training | Franchisor may provide and require additional training, seminars, meetings, or webinars (up to 5 days annually) for which a tuition fee may be charged. Additional initial or ongoing training may be provided upon request for a fee. |
Territory Rights (Item 12)
| Detail | Information |
|---|---|
| Territory Type | Protected |
| Exclusive Territory | Yes |
| Territory Size | Minimum population of 35,000 for Free Standing or In-Line franchises; one-mile radius for non-captive Kiosk franchises. No protected area for Kiosk franchises in captive locations. |
| Description | Franchisees are granted a Protected Area, except for Kiosk franchises in captive locations. For Free Standing and In-Line, the Protected Area has a minimum population of 35,000. For non-captive Kiosks, it's a one-mile radius. Captive Kiosk locations (e.g., airports, stadiums, malls) do not receive a protected area. Franchisor retains rights to operate or license businesses outside the Protected Area and within captive locations. |
Renewal, Termination & Transfer (Item 17)
| Detail | Information |
|---|---|
| Initial Term | 10 years for Free Standing and In-Line franchises; 5 years for Kiosk franchises. |
| Renewal Term | 2 additional 5-year terms |
| Renewal Fee | $7,500.00 |
| Renewal Conditions | Franchisee must be in good standing, meet defined requirements, provide timely notice, execute a new franchise agreement (which may have different terms), execute a general release, pay the renewal fee, and update/reimage/renovate/refurbish/modernize the business to current standards. |
| Transfer Fee | 75% of the then-current Initial Franchise Fee (new franchisee); 50% of the then-current Initial Franchise Fee (existing franchisee); $1,500 (among existing owners without change in controlling interest). A $5,000 non-refundable deposit is due when transfer approval is requested. |
| Transfer Conditions | Transferee must be of good moral character, meet franchisor's current criteria for new franchisees, execute a written assignment or new franchise agreement, execute a general release, complete a franchised business renovation (unless completed within 5 years), and principals must execute guaranties. Transferee must also successfully complete training. |
| Termination for Cause | Franchisor may terminate for various curable defaults (e.g., failure to pay fees, failure to comply with Manual, failure to maintain insurance) with 10 or 30 days to cure, or for non-curable defaults (e.g., abandonment, loss of premises, felony conviction, unauthorized transfer, repeated defaults). |
| Non-Compete Period | 2 years |
| Non-Compete Details | During the term of the franchise, franchisee and its principals may not have ownership in, operate, or be involved with a Competitive Business. After termination or expiration, for a period of two years, they may not have any interest in a Competitive Business within 10 miles of the former site or any other Original Rainbow Cone Business. |
Operations & Supply (Items 8 & 15)
| Detail | Information |
|---|---|
| Owner-Operator Required | Yes |
| Participation Details | An owner with at least 10% interest in the franchisee entity must be designated as the Operating Owner. This Operating Owner must be the primary operator, devote full-time and best efforts daily to management, and successfully complete the initial training program. The restaurant must also be under the direct on-site supervision of a designated manager who has completed training. |
| Required Suppliers | Franchisees must purchase ice cream and other ingredients, food products, beverages, packaging, equipment, signs, fixtures, point-of-sale system, software, marketing materials, marketing and promotional services, online/gift card/loyalty program services, architectural and accounting services, construction materials, and uniforms from designated suppliers. For Food Trucks, the truck and required equipment, fixtures, and wraps must be purchased from approved suppliers. |
| Supply Restrictions | Franchisor's affiliate, Keystone Planning + Design, PLLC, is currently the only designated supplier for design and architectural services. The Buona Companies, L.L.C. is an approved supplier of marketing materials, but not the only one. Franchisees must purchase other materials, supplies, and services from suppliers who meet franchisor standards and specifications and are approved in writing. Franchisor reserves the right to approve or disapprove alternative suppliers based on inspection and testing. |
| Franchisor Revenue from Suppliers | Franchisor does not currently receive payments from designated or approved suppliers, but reserves the right to do so in the future. Franchisor estimates that 60% to 80% of initial costs and 30% to 45% of ongoing costs will be from franchisor or designated/approved suppliers. |
Financing (Item 10)
| Detail | Information |
|---|---|
| Financing Available | No |
| Description | We do not offer direct or indirect financing. We do not guarantee your note, lease or obligation. |
The Original Rainbow Cone Franchise Earnings — Item 19
Average Revenue
$739K
Median Revenue
$452K
Revenue Range
$153K – $1.5M
Sample Size
5 units
Past financial performance does not guarantee future results. Individual results will vary.
The Original Rainbow Cone Litigation & Risk Flags
Clean Litigation RecordThe Original Rainbow Cone 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.
The Original Rainbow Cone System Growth
Total Units
10
Franchised
0
Company-Owned
10
The Original Rainbow Cone currently operates 0 franchised locations and 10 company-owned units. Unit count data is sourced from Item 20 of the FDD.
Unit History (Item 20)
| Year | Opened | Closed | Total |
|---|---|---|---|
| 2020 | 0 | 0 | 2 |
| 2021 | 2 | 0 | 4 |
| 2022 | 4 | 0 | 8 |
Transfers: 0 | Closures: 0
State Registrations
Registered in 9 states: CA, IL, IN, MD, MI, MN, NY, VA, WI
Franchisor Financials (Item 21)
Revenue
$331K
Net Income
$45K
Total Assets
$933K
Audited by R.J. Augustine & Associates, Ltd. for year ending January 1.
The Original Rainbow Cone Franchise — FAQ
The total investment to open a The Original Rainbow Cone franchise ranges from $82,000 to $2,929,650, per their Franchise Disclosure Document. This includes the initial franchise fee of $35,000 for Free Standing and In-Line, $20,000 for Kiosk. The investment covers build-out, inventory, equipment, signage, working capital, and other startup costs.
The Original Rainbow Cone charges a royalty fee of 7% of Gross Sales of gross sales, plus a Up to 3% of Gross Sales (currently 2%) for Brand Marketing Fund contribution; Minimum of 1% of Gross Sales for Local Advertising contribution to the marketing/advertising fund. These fees are paid on an ongoing basis.
You can download the The Original Rainbow Cone 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 The Original Rainbow Cone to ensure you have the most up-to-date version.
According to the Item 19 financial performance representation in their FDD, The Original Rainbow Cone franchise owners report average revenue of $739K and median revenue of $452K. This is based on a sample of 5 units. Past performance does not guarantee future results.
The Original Rainbow Cone has been franchising since 2019. The FDD shows an investment range of $82,000-$2,929,650, a 7% 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 $35,000 for Free Standing and In-Line, $20,000 for Kiosk and the total investment ranges from $82,000 to $2,929,650 depending on location size and market. Contact the franchisor directly for current net worth and liquid capital requirements, territory availability, and application details.
Similar Food & Beverage Franchises
Interested in The Original Rainbow Cone?
Get free info on this franchise. We will send you a detailed FDD report by email.
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 The Original Rainbow Cone and consult a qualified franchise attorney before making any investment decision. FranchiseOverview.com is operated by Franchising Compliance, LLC and is not affiliated with The Original Rainbow Cone or any of its subsidiaries. To report an inaccuracy: info@franchiseoverview.com