Are Amorino franchisees required to purchase gelato and sorbet from a specific source?
Amorino Franchise · 2025 FDDAnswer from 2025 FDD Document
Each Store must purchase and maintain an inventory of Proprietary Products as needed to meet reasonably anticipated consumer demand. A Store must purchase our gelato and sorbet from us, from our affiliate Amorino Trading, from our affiliate -18°, or from a producer, manufacturer, distributor or supplier designated or approved by us. You must purchase all products which bear any of our trademarks solely and exclusively from us or our affiliate -18° or from a producer, manufacturer, distributor or supplier we designate or approve. Amorino Trading and -18 are suppliers in which our officers owns an interest.
We may specify (i) certain beverages, food products and other ingredients, which are produced or manufactured according to our trade secrets, proprietary recipes, specifications and/or formulas, (ii) products which bear our trademarks, and (iii) certain packaging, POS Systems, computer hardware, software, modems and peripheral equipment or other products, supplies, services and equipment. You may buy these items only from us or from our designated suppliers (which may, in the future, include -18° or any of our affiliates). If the Store purchase any items from us or one of our affiliates, we or they may derive profits from these purchases.
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, approved sources. Specifically, franchisees 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. Furthermore, all products bearing Amorino's trademarks must be purchased exclusively from Amorino, its affiliate -18°, or a designated or approved supplier.
This requirement ensures that Amorino maintains control over the quality and consistency of its products. It also allows Amorino to derive revenue from franchisee purchases. In 2024, Amorino's affiliates derived $5,826,042.57 in revenue from the sale of products and supplies to franchisees. The FDD notes that the price franchisees pay for required products, including gelato, is marked up from the wholesale price. Amorino acknowledges that this markup allows its owners to derive revenue that would otherwise be charged as a royalty based on sales.
Amorino estimates that franchisees will be required to purchase 100% of their consumables and 30% of their other purchases from its affiliates, Amorino Trading or -18. The FDD also states that Amorino may change and designate different approved suppliers in the future, and franchisees are not allowed to suggest alternative suppliers. This means franchisees have no procedure to propose or for Amorino to approve different alternative suppliers.
For a traditional store, Amorino estimates that approximately 40% to 60% of the expenditures for purchases in establishing the store (excluding real estate lease costs) and approximately 20% to 40% of the total annual operating expenses (excluding real estate lease costs) on an ongoing basis will be for goods and services which are subject to sourcing restrictions. Many of these expenditures are to be made to Amorino's affiliates -18° and/or Amorino Trading, LLC. Prospective franchisees should carefully consider these required purchases and their associated costs when evaluating the financial viability of an Amorino franchise.