As an entrepreneur looking to purchase a franchise, it can be overwhelming to wade through the sheer number of franchise opportunities eager to welcome you into their system. Where do you start? How much will it cost? Which one do you pick? If you are traveling this road alone, you’ll be challenged to answer these questions on your own. An alternative to scouring through all that information by yourself could be to engage the services of a franchise broker/consultant to help you along the way.
What is a franchise broker/consultant?
A franchise broker (also known as a franchise consultant) is an individual who acts as an intermediary between the franchisor and an individual interested in buying a franchise. In most cases a franchise broker is not directly employed by the franchisor and represents many different franchises. There is no fee incurred by the individual interested in buying a franchise. The franchise brokers are paid a commission by the franchisor.
How can a franchise consultant help me?
There are an estimated 3000+ franchises available in the United States today. A franchise broker can help you select among these various franchise options. Typically, a broker will review the amount of money you have to invest and steer you toward opportunities that match with your interests and resources. They may also help you complete applications and the paperwork necessary to complete the franchise sale.
What should I know about franchise brokers?
There is a lot of debate in the franchise industry about the pluses and minuses of using a franchise broker. If you are thinking of using a franchise broker, here are a few tips to consider:
• Have a clear understanding of their services including their compensation
• Ask a lot of questions regarding their experience
• Be comfortable with their approach
A good broker will have a number of different options available and be well informed on the business model and type of candidate the franchisor is looking for in a franchisee. Also, remember that a franchise broker is only part of the process. You will also want to work closely with your accountant and a qualified attorney to help you navigate the financial and legal aspects that are critical to your success.
Some brokers may claim that the franchises they represent have been screened and meet certain standards; however, some brokers will represent any franchisor willing to pay them a commission regardless of the performance of that franchise system.
Some brokers may steer you toward a more costly franchise to beef up their own commission.
Some brokers may make certain representations about income. Earnings claims may not be true or can be misleading. Note that many franchisors prohibit their sales representatives from making earnings representations.
And run away from the broker that….
– speaks poorly of franchises not in his/her portfolio
– promotes franchise brokering as your best franchise opportunity
– uses heavy-handed and high pressure sales tactics
While a good franchise broker can help you make a more informed decision, it’s important that you are comfortable with both their knowledge and approach. Ultimately, the choice is yours to make. If you choose to work with a franchise broker, it is important to work with one who has YOUR best interests in mind. You have to trust that this individual will guide you toward the franchise opportunity that most closely meets your personal and professional goals.
To learn more about franchise opportunities with High Touch High Tech, visit us online at ScienceMadeFunFranchise.net.
High Touch High Tech is the leader in innovative hands-on science and nature experiences for children, serving over 4 million children annually with 27 franchise locations across the United States, Canada, Turkey, Singapore and South Korea.