Where must an Amorino franchisee purchase gelato and sorbet?
Amorino Franchise · 2025 FDDAnswer from 2025 FDD Document
otherwise be charged as a royalty based on sales.
We require that you purchase many products related to the initial establishment of your Store and your ongoing operations (including the gelato and sorbet itself) from our affiliate -18°, which is the 100% owner of Amorino USA, and from our affiliate Amorino Trading, LLC, which is 100% owned by Amorino USA. Examples of the items we require you to purchase from our affiliate - 18° include: furniture, fixtures, signage, lighting, equipment, restaurant supplies, uniforms, decorations, ingredients and products to be sold at your Store.
For a traditional store, we estimate that approximately 40% to 60% of your expenditures for purchases (excluding costs relating to your real estate lease) in establishing your Store and approximately 20% to 40% of your total annual operating expenses (excluding costs relating to your real estate lease) on an ongoing basis will be for goods and services which are subject to sourcing restrictions (that is, for which suppliers must be approved by us, or which must meet our standards or specifications). Many of such expenditures are to be made to our affiliates -18° and/or Amorino Trading, LLC.
ITEM 9 FRANCHISEE'S OBLIGATIONS
This table lists your principal obligations under the franchise and other agreements. It will help you find more detailed information about your obligations in these agreements in other items of this disclosure document.
| Obligation | Section in Franchise Agreement | Section in Area Development Agreement | Disclosure Document Item |
|---|---|---|---|
| a. |
Source: Item 8 — RESTRICTIONS ON SOURCES OF PRODUCTS AND SERVICES (FDD pages 32–36)
What This Means (2025 FDD)
According to Amorino's 2025 Franchise Disclosure Document, franchisees are required to purchase gelato and sorbet from specific sources. Specifically, a store must purchase gelato and sorbet from Amorino itself, its affiliate Amorino Trading, its affiliate -18°, or from a producer, manufacturer, distributor, or supplier designated or approved by Amorino.
This requirement ensures that Amorino maintains control over the quality and consistency of its core products. It also allows Amorino to potentially generate revenue through the sale of these products to franchisees. The FDD notes that in 2024, Amorino's affiliates derived $5,826,042.57 in revenue from the sale of products and supplies to franchisees. The price franchisees pay for required products, including gelato, is marked up from the wholesale price. This markup serves as a revenue stream for Amorino's owners, similar to a royalty based on sales.
Amorino estimates that franchisees will purchase 100% of their consumables from its affiliates, Amorino Trading or -18°. This requirement extends beyond just gelato and sorbet to include other items necessary for the store's operation. While Amorino may designate other approved suppliers in the future, franchisees are not allowed to suggest alternative suppliers. This restriction highlights the importance of the relationship between Amorino and its designated suppliers, as well as the limited autonomy franchisees have in sourcing products.
Prospective franchisees should carefully consider these sourcing restrictions and their potential impact on their operating costs and profitability. Understanding the financial relationship between Amorino and its affiliates, as well as the lack of flexibility in choosing suppliers, is crucial for making an informed investment decision.