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Summer 2014 Chill Out

Shaved ice leads to hot franchise for one entrepreneur.

Afew years ago Tony Lamb, founder and CEO of Kona Ice, watched as his young daughter approached an ice cream truck. Pumping annoying music, it was manned by a bare-chested, tattoo and piercings-covered driver. The attraction of the sweet treat overshadowed Lamb’s daughter’s fears and she eventually bought a grossly over-priced popsicle. As an entrepreneur and a marketing expert, Lamb knew there had to be a better way.

Kona Ice was born out of that experience. The vision was a mobile business that would sell moderately priced snow cones in customizable flavors. A presentable driver in uniform operates an immaculately clean truck with an open kitchen.

TonyOutsideKonaLamb designed his own truck and over the next three years went through five prototypes until he got it right. Lamb and his business have come a long way since 2004, when the business started. Back then he was perfecting the Kona experience, driving the first truck himself in Cincinnati, Ohio, and working 70 hours a week. “Although it was a great time to perfect the prototypes and work out all the bugs, it was hard on my family; I was out driving the truck a lot,” says Lamb.

All Kona Ice trucks are decorated with bright, fun, and welcoming decals and play cheerful music. Shaved ice flavors range from the basic “Groovy Grape” to “Kona Kola” and “Tropi-Kona.” All are made with 100% juice. The concept, which Lamb began franchising in 2008, has become very successful with 15 franchises the first year; there are now almost 500 trucks nationwide. This year alone, Kona Ice added 130 new franchises.

Franchise details

truckparkKona-copyLamb says the model is designed to keep things simple for franchisees and set them up for success. Here’s how it works: a truck and territory costs $100,000. Since territories are mobile, they are assigned using postal zip codes. Each franchisee gets to serve a population of 50-100,000. Once a truck and territory are purchased, franchisees are flown to company headquarters, and provided all the necessary training at Kona Kollege. Franchisees receive their truck after successful completion of training and pay an annual royalty of $3,000, regardless of revenues. The corporate office provides all marketing support, a website, social media marketing and lots of ongoing coaching and training.

Not just anyone can become a franchisee, says Lamb, “We are selective in the process. Many are first-time small business owners and we like to see that they are enthusiastic, yet analytical in making this business decision.”

Currently, Texas has 100 franchises, Florida has 40, and California, 40; the remaining 300 plus are spread throughout the country.

In addition to the traditional truck, Kona now offers a “mini” truck that can fit into smaller venues such as a ball field or school gymnasium as well as a trailer unit and kiosk. As a response to requests by franchisees to be able to conduct their businesses year-round, now Kona Ice can be made and served indoors using the mini-truck, trailer, or kiosk.

Business setup

boy-w-cupBusiness setup depends largely on the community, Lamb says. Some franchisees have a route that they drive regularly, which keeps them busy enough. Others specialize in visiting schools during school activities, games, or festivals. Others rely on online bookings—each franchisee is set up with a mini-website that offers an online booking function.

Lamb says the company prides itself in providing a special franchise model, especially for the food truck industry. Often food truck businesses are too costly on the front end for equipment, licenses and permits and the break-even point can be too high for small business owners. By keeping the product price point affordable at $2 to $5 and offering a low cost of ownership, Lamb says a Kona Ice franchise allows owners to start making money right away.

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Melissa M. Kellogg

Melissa M. Kellogg is a freelance writer specializing in small business, marketing, social media and retail business management. She is based in Edwards, CO, and is a regular contributor to GIFT SHOP magazine. Her work has also been published in various newspapers and magazines in the U.S. and Mexico

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