For over 10 years, I was a franchise broker (with a franchise brokerage franchise). I played matchmaker to people who were interested in pursuing franchise opportunities…in being their own bosses.
Most of the time, I referred to myself as a franchise “consultant.” It sounded better than franchise “broker” back then, and correct me if I’m wrong (don’t even think about it) I feel it still does today.
But, make no mistake about it: a franchise consultant* is a franchise broker.
*There is actually another type of franchise “consultant.” They’re the ones who are in franchise development. They work with individuals and companies that want to turn their businesses into franchise businesses. Right, Michael?
Things Franchise Brokers Don’t Want You To Know
There are at least 3 things franchise brokers won’t tell you. I’ll reveal the first one in a moment.
But first, there’s something I need to share with any franchise broker who is reading this post, or the two blog posts that will soon follow.
Try not to be angry with what I’m about to disclose to my readers about your segment of franchising.
A Guarantee: You will be mad at me if you don’t read these posts in their entirety.
That’s because there may be a few pearls of wisdom for you-for every franchising broker, included towards the end of each blog post in this 3-part series. Wisdom that can help you become a lot more successful in your business.
3 Things Franchise Brokers Would Prefer To Keep Under Wraps
Back to you-future franchise owner…
The first thing I’m going to share with you is something that you couldn’t possible know unless you’re already working with a franchising broker-or, and this is important, franchising brokers. Plural.
Work With The Franchise King®
Most franchise brokers work with the same franchisors, and most franchisors work with all of the same brokers.
If you’d like to read that sentence again, it’s fine. I’ll wait.
Only a small (but growing?) percentage of franchisors work with franchise brokers.
For example, Great Clips® and Sport Clips®, two popular franchise business opportunities that appeal to people who would like to keep their (mostly) high-level jobs while they start their businesses, pretty much work with every franchise broker in the US.
Franchisors generally don’t and won’t have exclusive relationships with individual franchise brokers or franchise broker groups. That’s because today’s franchisors want as many chances as they can get to sell their franchises. They want leads. Period.
I’ll go even further.
My Dad Told Me This
Early on in my career as a franchise broker, my Dad-who was one of the first franchise brokers around, told me something I’ll never forget. It had to do with the franchise brokerage we were with and brokers in general
“Joel, the franchisors don’t give a shit where their leads come from. They just want leads.”
And, of course, I didn’t believe him.
I thought franchisors would be picky. I thought they’d only work with the top brokers and brokerage groups.
I was wrong.
Selling franchises-awarding franchises to individuals-is a numbers game. The more leads coming in, the better the chances of a few of them converting into new franchise units.
Franchise Brokers Will Now Like Me
I’ll make some friends now. That’s because of what I’m about to suggest.
Don’t Work With More Than One Franchise Broker.
Did you feel that? Well, I felt it here…in my Castle.
It was a group sigh. And, it may someday turn into a massive franchise broker-Franchise King-group hug. Who knows?
If you work with two different franchise brokers, you’ll probably end up looking at the same franchises…or at least get some of the same suggestions. Probably.
But, worse than that, if you work with different franchise brokers-especially at the same time, you’ll turn into a ball of confusion.
You’ll start losing track of the franchises you’re supposed to be investigating. You’ll forget which broker referred you to which franchisor. And, let’s not forget about the franchises you’re finding on your own-C’mon, I know you’re looking at a few opportunities without the help of a broker, too.
Don’t do it. It’s not like the franchises you’ll be presented with will be all that different anyway.
Choose a franchise broker you like. Choose a franchise broker who you feel is trustworthy.
And it’s up to franchise brokers to differentiate themselves. They have to do enough online marketing and offline marketing to stay top of mind-so you can find them. Once you do, ask them some questions. Find out about their backgrounds. Ask them to share some success stories with you. Get references. You have a lot of choices-there are a lot of franchise brokers around.
So, now you know.
Update: Click Here For Part 2!
Franchise Broker FAQ’s
A franchise broker (sometimes known as a franchise consultant) is someone who is paid by specific franchisors to sell their franchise opportunities.
Franchise brokers are paid a commission of 40%-50% of the upfront franchise fee.
Franchise brokers are not licensed, because there are no are no licensing requirements at the present time.
You can, as long as you are good on the phone and can live off an unpredictable income stream.