Clarifying who is who in the world of franchising

You may have heard the terms “franchise consultant” and “franchise broker” before, but do you know what differentiates the two? Don’t worry, we’re here to help.

Choosing the right franchise to invest in can be a difficult and complicated decision. Considering the fact that there are thousands of franchise options in dozens of different business categories, the prospect of figuring it out on your own can be daunting.

Although franchise consultants and franchise brokers both exist to help find the perfect match for potential franchisees, they operate from a different motivational standpoint. Let’s dig a little deeper.

Franchise Consultants

Franchise consultants generally operate on a “fee-for-service” basis. The potential franchisee pays a small fee upfront and the consultant gets to work. In this arrangement, the consultant acts as a true advocate for the franchisee since they have no real stake in what franchise you choose other than your own satisfaction with the choice.

Franchise Brokers

Franchise brokers want the same outcome: to fit you into the right franchise. The difference is that brokers offer their services for free to the potential franchisee and instead are paid by the franchisor once they have found the right person to own and manage the operation. One thing to note is that brokers have agreements with franchises and tend to try to steer clients to those they have agreements with.

What Should You Choose?

If money is not an issue, a franchise consultant is the best way for you to go. If you are operating on a budget, a broker may be better for your needs. Just because they represent the franchisors does not mean they don’t care about your needs. Take care and choose wisely before making one of the most important investments of your life!