Ritter's Frozen Custard Franchise
Audited FinancialsRisk Score
Pending analysis
Investment Range
$76,000 - $1,138,000
Franchise Fee
$7,500
Total US Locations
19
Business Summary
Ritter's Frozen Custard operates Shoppes that offer a wide range of frozen custard products, beverages, hamburgers, hot dogs, and fries. The brand also provides opportunities for co-branding with existing businesses and opening satellite scoop shoppes.
Corporate History
Ritter's Frozen Custard's franchise system was originally developed and franchised by RFC Franchising LLC starting in April 2003. In April 2008, TRUFOODS, LLC, which was initially formed in 2005 as Miramar JC Condominium I, LLC and later changed its name to TRUFOODS, LLC in 2007, acquired the Ritter's Frozen Custard assets from RFC Franchising LLC. TRUFOODS, LLC then began offering franchises for Ritter's Frozen Custard Shoppes in Spring 2008.
Financial Overview
Investment Range
$76,000 - $1,138,000
Franchise Fee (Low)
$7,500
Franchise Fee (High)
$25,000
Royalty %
5%
Marketing %
2%
Equipment Costs (Low)
$60,000
Equipment Costs (High)
$753,000
Working Capital
$30,000
Audited Financials
Yes
Offers Financing
No
Audit Opinion
Unqualified opinion
Financial Health Notes
Ritter's Frozen Custard demonstrates a healthy financial position. The company has consistently reported positive net income, reaching $191,708 in 2023 and $148,456 in 2022. Cash flow from operating activities is also positive, at $135,960 in 2023. The company's member's equity has increased, standing at $984,253 in 2023. The independent auditors have issued an unqualified opinion on the financial statements and have not identified any substantial doubt about Ritter's Frozen Custard's ability to continue as a going concern.
Financing Details
Ritter's Frozen Custard does not offer any direct or indirect financing to its franchisees and also does not guarantee any notes, leases, or other financial obligations. However, Ritter's Frozen Custard franchisees are eligible for expedited and streamlined Small Business Administration (SBA) loan processing through the SBA's Franchise Registry Program.
Performance Metrics
Total US Locations
19
Franchised Units
19
Corporate Units
0
Avg Square Footage
2,150
Franchising Since
2008
Legal & Compliance Analysis
Recent Litigation
No
Bankruptcy
No
Litigation Summary
Ritter's Frozen Custard has no litigation to report, indicating a clean legal history as disclosed in Item 3 of its FDD.
Bankruptcy History
Ritter's Frozen Custard has no bankruptcy history to report for itself or its key management personnel, as stated in Item 4 of its FDD.
Agreement Terms
Initial Term
10 years
Renewal Term
10 years
Renewal Conditions
To renew their Ritter's Frozen Custard franchise, franchisees must notify the franchisor in writing 6 to 12 months before their current agreement ends. They must be in good standing, meaning they have no outstanding financial or other obligations and have substantially complied with all terms of their franchise agreement and other related agreements. Franchisees will need to sign a mutual general release, meet current qualification and training requirements, and upgrade their Shoppe to reflect the brand's latest design, equipment, and decor standards. They must also show they have the right to keep their location for the new term, meet current financial responsibility standards, and pay a successor agreement fee equal to 50% of the then-current initial franchise fee. They will sign the franchisor's then-current franchise agreement, which may have different terms, but the territory boundaries will remain the same.
Training & Support Program
Franchisor Assistance
Ritter's Frozen Custard provides franchisees with several forms of assistance. Before opening, this includes approving or denying proposed sites, providing initial training for the franchisee and one manager, supplying prototype plans and specifications for Shoppe construction and design, inspecting and approving the Shoppe for opening, lending copies of the Operations Manuals, planning the grand opening advertising campaign, and providing a list of approved suppliers. After opening, Ritter's Frozen Custard may provide a representative for up to seven days around the opening, conduct periodic inspections and evaluations, offer additional training programs, give ongoing advisory assistance on operations and promotion, and maintain a Brand Development Fund for advertising and marketing.
Initial Training Hours
95
Training Location
Indianapolis, Indiana
Ongoing Support
Ritter's Frozen Custard provides ongoing support to its franchisees after their Shoppes open. This includes conducting periodic inspections and evaluations of the Shoppe's operations, making additional training programs available as needed, and offering periodic advisory assistance on the operation and promotion of the Shoppe. The franchisor also maintains a Brand Development Fund for system-wide advertising and marketing.
Franchise Requirements
Ideal Candidate Profile
Ritter's Frozen Custard seeks franchisees who are qualified legal entities or individuals. Ideal candidates, or their designated principal (who must hold at least a 10% ownership interest), are expected to be involved in the general oversight and management of the Shoppe. The franchisor looks for individuals who meet certain qualifications, including educational, managerial, socially responsible, and business standards, possess good moral character and business reputation, have a strong credit rating, and demonstrate the aptitude and ability to operate a Ritter's Frozen Custard Shoppe without conflicting interests. Franchisees must also have adequate financial resources and capital to operate the business.
Industry Experience Required
No
Management Experience Required
Yes
Sales Experience Required
No
Technical Skills Required
No
Operational Details
Location Type
retail
Owner Participation
supervisory
Territory Type
Non-Exclusive
Staff Count
2
Territory Size Requirements
Ritter's Frozen Custard franchisees operating a traditional Shoppe typically do not receive an exclusive territory. However, if a territory is granted, the specific geographic radius will be listed in an exhibit to the Franchise Agreement. For a Ritter's Frozen Custard Scoop Shoppe, it must be located within a 20-minute drive time of the franchisee's existing Ritter's Frozen Custard Shoppe and cannot be in close proximity to another franchisee's Shoppe, as determined by the franchisor. Multi-unit developers are granted an Exclusive Area, the size and scope of which are determined on a case-by-case basis before signing the Multi-Unit Development Agreement. Within this Exclusive Area, the franchisor will not establish or license another Ritter's Frozen Custard Shoppe, except for Non-Traditional Sites, as long as the multi-unit developer complies with their development obligations.
Staffing Notes
Ritter's Frozen Custard requires franchisees to maintain a sufficient number of competent and courteous staff to serve customers effectively. Employees must adhere to uniform and dress code standards and meet quality service expectations. Each Shoppe must have a minimum of two certified managers on duty at all times, one of whom can be the franchisee. Franchisees are fully responsible for all employee-related decisions, including hiring, firing, and setting wages. The franchisor provides training only for managers and replacement managers; franchisees are responsible for training all other employees.