Franchise Brokers Vs. Franchise Consultants – Distinctions With a Difference

The term “franchise broker” and “franchising consultant” are often in the press, often means they are the same. But what is a franchise broker, and how it differs from a franchise consultant. Are there any objective, impartial advice? This article answers these critical questions.

A franchise is a paid agent franchise business. Many players claim that the franchise will help you find a franchise company that is the perfect choice for your background and skills, and that its service is free. In the beginning everything sounds good. There are some personality tests and examination of personal finance. At the end of the day, it appears that only a handful of small franchise companies you’ve never heard of before. A detailed analysis often reveals these highly touted franchises mediocre or even below minimum wage, the financial results. However, runners do not mention this franchise, and people continue to rely on their recommendations, believing that the broker represents. Nothing could be further from the truth.

Franchise brokers receive a large commission of 50% or more of the franchise fee is paid the company a franchise. Franchise Broker realities: (1) Their service is not “free” despite these and other misrepresentations. It’s really common sense – how can anyone offer a “free” service and survive in the business? The simple truth is that if you buy one of those franchises that are selling, the money goes to the franchise, then the rider pocket. If anyone ever calculated how much time they spend collecting the $ 15,000 or $ 20,000 commission is likely to earn more than a neurosurgeon. (2) Franchise brokers definitely do NOT have your best interests in mind. To do or say what they have to in order to close a deal and earn a commission.

A franchise consultant is usually an independent consultant offering advice to others (usually franchise companies wanting to franchise their business) for a fee. This makes their advice, in theory, more impartial to the extent that they are not compensated by third parties. Because they are not legally required to disclose actual or potential conflicts of interest, it is important to ask questions. For example, if we recommend the “best franchise”, they are paid nothing by the companies on your list? This could be a commission, the return or “consulting fees.” Many franchise brokers call themselves “franchise consultants” to hide his true identity. Therefore, make sure you are dealing with a franchise consultant, he or she is not really just a franchise agent.