{"id":13001,"date":"2014-06-16T02:33:05","date_gmt":"2014-06-16T02:33:05","guid":{"rendered":"https:\/\/www.thefranchiseking.com\/?p=13001"},"modified":"2024-01-08T10:19:39","modified_gmt":"2024-01-08T15:19:39","slug":"3-things-franchise-brokers-prefer-keep-wraps-number-two","status":"publish","type":"post","link":"https:\/\/www.thefranchiseking.com\/3-things-franchise-brokers-prefer-keep-wraps-number-two","title":{"rendered":"3 Things Franchise Brokers Would Prefer To Keep Under Wraps: #2"},"content":{"rendered":"

\"brokers<\/a><\/p>\n

There are several things today\u2019s franchise brokers would like to keep under wraps.<\/p>\n

The 3 things franchise brokers would prefer to keep under wraps<\/b> that I’ve decided to share with you aren\u2019t bad things<\/i>. Not at all. They\u2019re just things that you<\/em>-the prospective franchise business owner<\/a> should know.<\/p>\n

Isn’t that why you\u2019re here?<\/p>\n

Don\u2019t you want to have as much information on franchising as possible<\/a>?<\/p>\n

Franchise Broker Information I Shared So Far<\/h2>\n

In Part 1<\/a><\/b> of this 3-Part franchise blog series on franchise brokers-and some of the things they prefer to keep under wraps, you learned something really interesting about franchise brokers <\/a>and the franchisors that use them.<\/p>\n

This:<\/p>\n

Most franchise brokers work with the same franchisors, and most franchisors work with all of the same brokers.<\/strong><\/p>\n

So, what does that mean for you\u00a0<\/em>? Why is it important for you to know?<\/p>\n

It\u2019s important for you to know so you won\u2019t waste time working with two franchise brokers at the same time since they\u2019re probably working with the same franchisors. It\u2019s a waste of time, and can lead to serious confusion. It\u2019s hard enough investigating two or three franchise opportunities at once, even\u00a0if you\u2019re doing it right<\/a>.<\/p>\n

A Note About Franchise Brokers<\/h3>\n

I read this a while ago. It was posted on a now-defunct franchise forum. It’s pretty harsh, but it’s true.<\/p>\n

“It is important to point out that not all brokers practice their craft the same way, which highlights the fact that obfuscation is not an essential element of franchise sales. Each of the major broker networks, while disclosing that it is paid by the franchisor, in one form or another represents that it provides no-cost, beneficial services to prospective franchisees. On some of the web sites, though, a prospective franchisee is led to believe that the broker is its coach, adviser or consultant. Indeed, some brokers describe prospective franchisee as their clients, even though they are paid and are agents for the franchisor. An assertion that the prospective franchisee is the client when the broker is a paid agent of the franchisor is totally unsupportable. The conflict of interest and the unfairness to a potential franchisee are apparent<\/em>.”<\/p>\n

– Michael Seid<\/a>, MSA Worldwide<\/p>\n

3 Things Franchise Brokers Would Prefer To Keep Under Wraps: #2<\/h2>\n

Who are you? Seriously.<\/p>\n

When you work with a franchise broker, who are you?<\/p>\n

The answer…<\/p>\n

Wait. Let me do it this way, instead.<\/p>\n

Who aren’t<\/i> you?<\/p>\n

The answer: The client<\/em><\/strong>.<\/p>\n

When you work with a franchise broker, you<\/em>\u00a0 are not their client. <\/strong><\/h3>\n

The franchisor is<\/i>.<\/p>\n

You only \u201cfeel<\/i>\u201d like you\u2019re the client when you\u2019re working with a franchise broker.<\/p>\n

Just Follow The Money Trail<\/h2>\n

Most franchise brokers (who sometimes call themselves consultants<\/i>) offer their services for free. That\u2019s because they\u2019re paid by the franchisors<\/strong>. It\u2019s really easy to follow the money trail. Unless\u2026<\/p>\n

Some franchise brokers charge a fee. They call it a consulting fee or a commitment fee. It can range from $50 to a few hundred dollars. Some brokers feel that by charging a fee they\u2019ll be able to get only \u201cserious<\/i>\u201d prospects. It\u2019s up for debate, but since I\u2019m not a broker anymore, I\u2019ll leave it to the brokerage community to do.<\/p>\n

The question:<\/p>\n

If you work with a franchise broker who charges a small upfront fee, does that change things? Are you the client since you\u2019re paying a fee?<\/em><\/p>\n

No.<\/p>\n

The franchisor is the client because they’re paying the big<\/em>\u00a0 fee.<\/strong><\/p>\n

The franchisor is the client because they have a signed sales agreement with the broker. A signed contract<\/em>.<\/p>\n

Does it matter?<\/p>\n

Yes. Of course it matters.<\/p>\n

Whenever money changes hands because of something you’ve said yes to, a sale has been made<\/strong>. In this case, there are two<\/em>\u00a0 sellers.<\/p>\n

The franchisor and<\/i> the franchise broker.<\/p>\n

They both<\/em>\u00a0 make money when you send in your check for the upfront franchise fee and sign the franchise contract. <\/b><\/p>\n

It\u2019s not a bad thing. But, it is a \u201cthing<\/i>.\u201d<\/p>\n

\u00a0<\/a><\/p>\n

Full Franchise Broker Disclosure<\/h2>\n

I’m not sure you know this about me, but I’m trying to change the franchise world.<\/p>\n

Part of the change that needs to take place has to do with disclosure. Franchise buyer’s need to know who’s who in the franchise broker-franchise buyer relationship.<\/p>\n

My suggestion:<\/p>\n

Franchise brokers need to disclose their relationship with you-the prospective franchise owner.<\/strong><\/p>\n

In today\u2019s day and age-the age of transparency in business<\/a>, it\u2019s the right thing to do. And it\u2019s important for you to know who\u2019s who.<\/p>\n

In Part-3 of this series on the 3 Things Franchise Brokers Would Prefer To Keep Under Wraps<\/b>, I’ll unwrap something else for you.<\/p>\n

Here is Part 3<\/a>\u00a0<\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"

There are several things today’s franchise brokers would like to keep under wraps. The 3 things franchise brokers would prefer to keep under wraps that I’ve decided to share with you aren’t bad things. Not at all. They’re just things that you-the prospective franchise business owner should know. Isn’t that why you’re here? Don’t you […]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_mo_disable_npp":"","footnotes":""},"categories":[252,564],"tags":[1630,1461],"class_list":["post-13001","post","type-post","status-publish","format-standard","hentry","category-franchise-brokers","category-franchise-ownership","tag-franchise-consultants","tag-franchise-disclosure"],"yoast_head":"\n3 Things Franchise Brokers Would Prefer To Keep Under Wraps: Part 2<\/title>\n<meta name=\"description\" content=\"Here is #2 of the 3 things franchise brokers would prefer to keep under wraps.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.thefranchiseking.com\/3-things-franchise-brokers-prefer-keep-wraps-number-two\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" 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Subscribe to my free VIP Franchise Newsletter.","sameAs":["https:\/\/www.thefranchiseking.com","https:\/\/www.instagram.com\/thefranchchiseking1","https:\/\/linkedin.com\/in\/joellibava","https:\/\/in.pinterest.com\/franchiseking\/","https:\/\/www.youtube.com\/JoelLibava"],"knowsAbout":["Franchising"]}]}},"_links":{"self":[{"href":"https:\/\/www.thefranchiseking.com\/wp-json\/wp\/v2\/posts\/13001","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.thefranchiseking.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.thefranchiseking.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.thefranchiseking.com\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.thefranchiseking.com\/wp-json\/wp\/v2\/comments?post=13001"}],"version-history":[{"count":1,"href":"https:\/\/www.thefranchiseking.com\/wp-json\/wp\/v2\/posts\/13001\/revisions"}],"predecessor-version":[{"id":45793,"href":"https:\/\/www.thefranchiseking.com\/wp-json\/wp\/v2\/posts\/13001\/revisions\/45793"}],"wp:attachment":[{"href":"https:\/\/www.thefranchiseking.com\/wp-json\/wp\/v2\/media?parent=13001"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.thefranchiseking.com\/wp-json\/wp\/v2\/categories?post=13001"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.thefranchiseking.com\/wp-json\/wp\/v2\/tags?post=13001"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}