How to Franchise Your Business - Working with Franchise Brokers

The franchise development process can be an exciting time for franchisors who are rapidly expanding their brands into new markets.  The amazing growth that some franchises are able to accomplish doesn’t come by accident though.  Good franchise systems have excellent franchise development models in place to recruit franchisees.

A franchise marketing system includes not only lead generation and advertising but also a sales process, franchise salespeople and a franchise sales system that allows for a solid ROI on marketing dollars and ultimately more sales for the franchisor. 

When discussing how to franchise a business effectively, one channel that always comes up as a question mark, particular for new franchisors, is how or why they would consider working with franchise brokers.  A Franchise Broker is a third-party referral source that supports franchise development efforts by way of introducing qualified franchise leads. 

Franchise brokers will be paid anywhere from $15,000 up to $30,000 for a sale in commission when the franchise lead is placed in a system.  As one might imagine, particularly for a new franchisor, this is a difficult pill to swallow and seems egregious when considering that franchise fees may only be $25,000 to $50,000.  Keeping in mind that the value of the royalties and recruiting a new franchisee well outweigh a single commission payment, it still is a very good deal for the Franchisor.   

As an outsourced Franchise sales organization, Franchise Marketing Systems generally recommends working with brokers and certainly for a new franchise system that needs every bit of exposure they can get while entering the franchise marketplace.  A Franchise broker will operate much like a real estate agent will, in that they represent a large group of franchise brands and when they develop a relationship with a buyer, they will help the buyer find the best fit for them out of the franchise options they work with. 

The Franchise Broker spends their own money on advertising and presents themselves as a third party, not connected to any one franchisor in order to help the franchisee from as unbiased of a position as possible.  Because franchise brokers are only paid on success fees, as a franchisor, you need to almost work with brokers like a second customer in order to show them you care about their success and are willing to invest in their clients also. 

Franchisors who do a great job with this process are doing things such as buying plane tickets for broker’s clients who get to the discovery day process, being extremely reactive to broker’s needs and requests, being available for calls and focused on follow-up with broker’s leads after the introduction and flying brokers out to the corporate headquarters for a meet and greets. 

Several franchise brands have mastered working with Franchise Brokers and managed this process very well.  Menchie’s offers a $30,000 commission, and Schooley-Mitchell presents a $27,000 commission along with other franchisors who have had great results working with Franchise Brokers. 

The benefit to it all is that with a great franchise broker campaign, some Franchisors are able to manage a large part or virtually all of their franchise development campaigns.  Many franchisors have driven fantastic results by leveraging franchise broker relationships. 

An easy way to start working with franchise brokers and introduce your franchise brand is to join franchise broker networks.  Some of these that we recommend include:

IFPG – – reasonable fees and solid results.
Franserve – – a great network for startup franchisors.
Frannet – – established and productive network.
Franchoice – – proven and professional franchise broker network.

These networks charge varying fees to enter the system, but will allow a new franchise brand to have access to hundreds of brokers and immediate access to great franchise relationships.  When you franchise your business, it is critical to get the help, assistance and additional exposure from third party franchise brokers. 

For more information on how to work with Franchise Brokers, Contact Us:

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