Red Flags to owning a ritas
Rita’s Italian Ice, ruining one life, one family, one dream at a time.
No corporate owned stores. None of the Rita’s employees run actual stores.
Rita’s employees do not recognize that their decision-making affects business owners across the globe. You are only as good as your franchisor. When you invest into a brand, you are investing in the people running the brand. All high-level executives have left Rita’s due to the failure of the brand which they were responsible for. If you visit their web site, you will only see one executive. All others have left and moved on to different companies.
After Rita’s sold a lot of territory between 2013-2016, the company was sold after only a few years to another private investment group. The previous group oversold territory flipped their money and got out. The new ownership group will force you to open locations or lose your license.
New stores in emerging markets have a life span of about 3 years before they close down due to a lack of sales and marketing support.
Want to close? Expect a letter from Rita’s corporate attorney notifying you that you are defaulting on your franchise agreement. Imagine losing, your life savings, retirement. Some franchisees go thru bankruptcy and even worse divorces.
You can pretty much franchise anything today. Just because you have a product does not mean it is scale able. In theory any product can be franchised, however that does not mean there is demand and an actual business model.
Depending on where you are located, you may be asking yourself what Italian Ice and Frozen Custard is? That is probably the only thing unqiue about the brand is outside of the midwest and east coast there are not a lot of Italian Ice and Frozen Custard Brands. The Italian Ice is made by Dippin Flavors. You can buy several of these flavors yourself without having to invest a dime into the brand. Nothing proprietary other than sticking you label on someone else's product.
Depending on which venue you are looking at, costs can significantly vary. One thing that commonly occurs is the return on investment is normally lost.
Unlike 99% of franchises, Rita’s expects you the franchisee to monitor their distribution and report any products which do not meet their freshness policy. Oh, and you have 24 hours to do it. If you are like most people and have a life outside of Rita’s, 24 hours is near impossible. In addition to babysitting their distributors, they recently announced the need to create a disposal video in order to receive the credit.
So in short, they sent you bad product, you have 24 hours to react and you are responsible for disposing the product, recording it and submitting for a credit.
Unlike the eastern markets which are saturated with the presence of Rita’s and only operate half of the year, western markets are expected to operate all year. During the Winter season which is when losses begin to pile up and all franchisees have to invest additional capital into their business. Remember there are no corporate ran stores, so you are burdened with all of the bleeding.
Rita’s has not provided any local marketing, outreach or sponsorships to help grow the brand in emerging markets. It has shut down the Western markets by doing so. The only marketing you will receive are the poster boards for specials during the calendar year.
Rita’s supports new franchisees by training them at their headquarters, however, once a store is opened or reopened, you are on your own. The local business consultants which Rita’s assign to you are not very helpful. They pretend to fight for the franchisees but they do not deliver results. A common thing which is said is that is above their pay grade, and corporate does not share decisions which are crucial to the franchisees success with them. Nor do they value anyones output.
several operation audits occur throughout the year, so expect to see operational issues arise which are submitted to the franchisee as a memo written by the Director of Field Operations. Each letter basically warns you of fines if you do not follow