If your thinking about buying a franchise, you may be wondering if you should use a franchise broker. A seasoned and ethical franchise broker can maximize your success because of three key areas that they bring to the table:
3. Franchise Fit
Before we continue, I’d first like to ask you to consider that if you were looking to purchase a house would you do so without consulting with and using a real estate broker? Most, I think would say, no. And why? Because the best real estate brokers have significant:
- experience and knowledge of the current housing market
- knowledge of the best locations, and
- knowledge of preferred residential development areas.
But most importantly, a qualified real estate broker can help you find a house that is aligned with:
- where you want to live
- what type of house you want to live in
- what location makes the most sense for you and your family
- your required price range and budget.
And not unlike the real estate broker, the role of the ethical franchise broker is to help you:
- screen through the franchise opportunities
- narrow down your choices, and
- help you avoid mistakes.
Ethical franchise brokers can help you cut through the weeds and can be an invaluable asset to you when navigating the franchise industry in Canada.
3 Reasons to Use a Franchise Broker
1. Franchise brokers have valuable knowledge
Someone famous once said:
If you don’t know where you’re going any road will take you there.
Well buying a franchise is no exception. Except that in this case, if you don’t know the franchise that’s best for you, choosing any franchise won’t get you there. And, it will probably end up costing you a great deal of time,effort,frustration, stress and money.
Did you know?!
That there are:
- approximately 1,500 individual franchise brands operating today in Canada, and
- almost 76,000 franchise locations with a combined GDP in excess of $100 billion dollars (2019).
And annually there are literally hundreds of new franchises joining the ranks of those already established and emerging franchise brands. These franchises represent almost every consumer and service sector you can think of, with investment levels that vary from under $10k to well over a million dollars.
As you can imagine, there are literally hundreds of thousands of pages of information and data about the myriad of franchise choices there are out there to choose from. And, a knowledgeable broker can help you cut through the clutter to point you in the right direction.
Franchise Brokers are a crucial source of franchise industry information. For example, franchise brokers:
- understand current provincial franchise legislation
- know what financing options are available to new franchisees
- have important contacts with traditional banking, non-traditional financing, and government funding
- have insight into current and future franchise trends.
And combined, all of this information is critical for budding entrepreneurs. We can help you learn the basics of franchising, and assist you to prepare your business plan and perform your due diligence.
2. Franchise brokers have broad experience:
Based on our knowledge and experience, The Franchise X-Perts team can help you structure your approach in the most strategic and valuable way. And, we also know how you can best articulate and present yourself to franchisors.
Qualified ethical franchise brokers like The Franchise X-Perts can help you maximize your chances of success. We know that investing in a franchise is a two-way street. So during the recruitment journey, it’s important that you know what to look for in a successful, ethical franchise system and what questions to ask throughout the process.
For example, it’s quite common for candidates to look at franchise companies and see a lot that they like. But, they may overlook things, or choose to minimize things they don’t want to see and feel they have to settle.
However, if you have done your due diligence and have a clear vision of what you want, with the help of a solid franchise broker you should not have to settle. A good franchise broker will eventually bring the perfect match to you.
While falling for a certain franchise sector or system isn’t necessarily a mistake, it can blind you to key questions you should be asking. Often, the broker is there to help protect you from yourself.
Franchisors expect to see candidates with at least a basic understanding of franchising. And, if you’re able to demonstrate this knowledge, as well as your own initiative by being armed with sensible, relevant questions throughout the process, you are guaranteed to stand out.
3. Franchise brokers know about fit for franchising
Lets talk about franchise fit for a moment.
A recent survey of the top franchise systems in North America asked the question: ” What are the top characteristics that a franchisor looks for when interviewing a potential franchisee candidate for their franchise system?”
All gave the answers that you would normally expect, such as:
- previous business experience
- financial capability
- character, etc.
But, what was interesting about this particular survey and different from previous such surveys was that Fit was number one. In the majority of cases, personality fit was the characteristic most important to move forward with any candidate regardless of all other considerations.
So what do we mean when we talk about fit?
Personality fit refers to how aspects of your personality match the requirements of the franchisee role. For example, when personality fit is high, you will have:
- passion for the role
- energy and motivation to do the job in the best possible way
- a positive outlook regarding people and processes
And, you’ll be enthusiastic about innovation and new ways of doing things when required.
To learn about your fit for franchising, I encourage you to complete the free Franchisee Self-Assessment. By completing our Franchise Self-Assessment, you can use your results to determine if you would be a great fit for franchising. The results can help you to sell yourself and demonstrate that you would be a successful franchisee candidate. And you might just find out something about yourself that you didn’t know!
Complete the free Franchise Self-Assessment today!
How do franchise brokers find the right fit for you?
Like any investment, buying a franchise business carries risk. And while using a franchise broker does not remove all the risk, it can help minimize it. Ethical Franchise brokers will spend hours with you before they even think about suggesting a franchise.
We want to know your:
- motivations, and
We want you to understand the pros and cons of franchise ownership. We want to know just how committed you are to the business? Are you a good manager? Do you work well with employees? All of these things help us match your characteristics to the characteristics of the franchise.
Ok, so how much is all this going to cost me and who pays the broker for all of this advice? Well the good news is that it’s at no cost to you!
Traditionally, those buying a franchise business do not pay the franchise brokers. Franchisors do because they view the cost of the brokers as a marketing expense in order to get qualified candidates.
At The Franchise X-Perts and Franchising for New Canadians, we are valued by our franchisor partners for one thing – we introduce them to only qualified candidates.
By that measure, a franchise broker with an established record and a long history is a sure bet.
Buying a business is a huge decision and typically filled with emotion and stress. A franchise broker can be a beneficial ally to ease the indecision and anxiety and help guide you to your ideal fit.
Finally As qualified ethical franchise brokers who have been there, done that, seen it all from both sides, and bought the t-shirt, I’m confident that choosing the right franchise broker will help you pick the right ship.
After all purchasing a franchise will be one of the most significant financial investments that you will probably make during your lifetime. Make sure its the right one!
So to answer the question we first posed “Why would I use a franchise broker?” I would simply say “Why wouldn’t you?