1851

Franchising has become a popular avenue for entrepreneurs looking to invest in a business. However, the role of&nbsp;<a href="https://1851franchise.com/growthclub/1851-growth-club-an-invitation-to-the-franchise-broker-community-2723914">brokers, consultants and coaches</a> in the franchise acquisition process can be confusing, especially when it comes to the process of broker commissions and its impact on franchisees. That is the exact type of issue the&nbsp;<a href="https://1851franchise.com/growthclub/1851-growth-club-transparency-in-the-buying-process-2723915">1851 Growth Club</a> was created to solve by promoting ongoing transparency and education for all stakeholders in the realm of franchising.&nbsp;“We've built our foundation on honesty and integrity,” said&nbsp;<a href="https://www.linkedin.com/in/powills?utm_source=1851franchise.com&utm_medium=article&utm_campaign=1851-growth-club-honest-commission-model-2723987" target="_blank" rel="nofollow">Nick Powills</a>, CEO of The Growth Club. “I want to shed light on how broker commissions function. It's not about arguing whether brokers deserve commissions — they undoubtedly do. As you delve deeper into Growth Club, our stand is clear: they should earn commissions, but there needs to be transparency surrounding it.”<h2>The Myth of "Free" Coaching</h2>Often, aspiring franchisees seek guidance on&nbsp;<a href="https://1851franchise.com/growthclub/1851-growth-club-when-buying-a-franchise-what-can-i-afford-2723893">how to buy a franchise</a>, and they encounter brokers, consultants or coaches who claim to offer their services for free. However, the reality is that these professionals&nbsp;<a href="https://1851franchise.com/growthclub/1851-growth-club-commission-structure-2723911">do not work for free</a>. While they may not directly charge you a fee, their compensation comes from the franchisor, and it's essential to understand how this process operates.One significant limitation of relying on brokers or consultants is that they typically present franchise brands that are part of their inventory. They are unlikely to explore options beyond what's in their inventory because their income relies on closing deals. This means you might not be exposed to all available opportunities, limiting your choices as a prospective franchisee.“To attract and compensate these brokers, franchisors began inflating&nbsp;<a href="https://1851franchise.com/what-is-a-franchise-fee-2717526">franchise fees</a>,” said Powills. “Originally, a franchise fee was meant to cover the costs for a franchisor to support a new franchisee until they were operational. However, these fees began to also encompass the cost of acquiring a new franchisee. In many cases, the franchise fee you pay is used to compensate the broker.”As franchisors aim to attract more potential franchisees, they increase franchise fees to offer higher commissions to brokers. “The increasing fees mean that your initial capital for starting the franchise is affected,” said Powills. “We've seen franchisors grappling with this, trying to strike a balance. But it's crucial to understand that the elevated fees you're paying often go to the broker who introduced you to the franchisor.”Brokers may encourage you to consider larger franchise packages, such as three packs, five packs, ten packs, or even twenty packs. This is because when the total cost of your franchise investment increases, their commissions also rise. While these opportunities may be suitable for some, it's essential to understand that brokers are motivated by the potential for higher commissions.<h2>Maximizing Your Investment</h2>Franchising can be a valuable asset, but it's crucial to be aware of how broker commissions can impact your investment.&nbsp;“I believe the broker business model isn't inherently bad,” said Powills. “In fact, it can be a valuable asset, provided there are checks and balances to ensure the franchisee's best interest. As a potential franchisee, you're investing a significant chunk of your savings into a venture with limited control. We want to ensure you get maximum value from your investment, enabling you to scale and secure a prosperous future for your family.Transparency is key in the franchising process. As a response to the challenges posed by escalating franchise fees, some organizations have taken steps to address this issue. For example, Growth Club has&nbsp;<a href="https://1851franchise.com/growthclub/1851-growth-club-commission-structure-2723911">capped broker commissions at $20,000</a> to provide more clarity to franchisees about the costs involved in the process.“Our mission is twofold — for franchisors, we aim to allocate funds efficiently and for franchisees, we're striving to reduce the franchise fees, offering you more operational capital at the start,” said Powills. “This positions both parties for greater success in the franchising journey.”In conclusion, the goal at Growth Club is to maintain integrity in all dealings. Explore our other content to learn more about our&nbsp;<a href="https://1851franchise.com/growthclub/1851-growth-club-the-transparent-inclusive-hub-for-all-things-franchising-2723723#industry">commitment to transparency</a> in the franchising world.

1851 Growth Club: Honest Commission Model

1851 Franchise

While many franchise brokers claim to offer “free” coaching, the truth is that those costs are passed down to the franchisee through franchise fees, which have skyrocketed over the last few years.

This brand page has been paid for by 1851. Content within this page that is paid will showcase a Sponsored icon. This means the brand has engaged 1851 FRANCHISE to write the content. Content without the Sponsored Icon is aggregated media placements the brand earned. Questions can be sent to editorial@1851franchise.com

1851-growth-club-honest-commission-model

Sola Salons

Sola Salons Targets Chicago for Strategic Franchise Growth

sola-salons-targets-chicago-for-strategic-franchise-growth

Melting Pot

Photo of Melting Pot white chocolate fondue

How Melting Pot Franchisees Drive Year-Round Success Through Strategic Promotions and Local Marketing

melting-pot-franchise-year-round-success

Crust Pizza Co.

Crust Pizza Co. - Technology Piece - CTO Nick Fontenot - May 2025 - 1851 Franchise

Crust Pizza Co. Builds the Future of Franchising With Tech-First Strategy

crust-pizza-co-technology-nick-fontenot-cto

Paris Baguette

Paris Baguette’s Recipe for Expansion: Leadership, Community and A Vision for 1,000 Cafés by 2030

paris-baguettes-recipe-for-expansion-leadership-community-and-a-vision-for-1000-cafes-by-2030

Seniors Helping Seniors®

Franchisee Spotlight with Billy and Anita Clark and Seniors Helping Seniors

Heart and Purpose: Couple Launch Seniors Helping Seniors® Franchise in Northern Arizona

heart-and-purpose-couple-launch-seniors-helping-seniors-franchise-in-northern-arizona

Buying a Franchise Masterclass

 Franchise Opportunities

Get Support Buying a Franchise

How to Buy a Franchise White Paper

How to Buy a Franchise

How to Sell Franchises

How to Grow a Franchise

Find a Franchise Supplier

1851 Franchise Opportunities

Franchisor News

Franchisor Power Rankings

FranCamp Mastermind Summit

Franchise Resources

What ALEC-Laffer's Report Means for Franchising

Website Awards

Power Rankings

About 1851

Advertise on 1851

Contact 1851 Editorial

Terms of Use

1851 Login

GROWTH CLUB LOGIN

facebook

instagram

twitter

linkedin

youtube

DoorDash Expansion Could Reshape Delivery and Operations for Franchise Brands - 1851 Franchise

DoorDash Expansion Could Reshape Delivery and Operations for Franchise Brands

doordash-acquistions-deliveroo-sevenrooms

Crumbl Franchise Investment - TSG Consumer Partners -  1851 Franchise

TSG Consumer Partners Takes Minority Stake in Crumbl, Signaling Franchise Growth Potential

crumbl-franchise-investment-tsg-consumer

Yum Brands Reports Strong Q1 Results with Big Boost from Taco Bell

yum-brands-reports-strong-q1-results-with-big-boost-from-taco-bell

QSR: McDonald’s Gains Momentum With Chicken Innovation, Value Deals and Franchisee Support

mcdonalds-franchise-recovery-chicken-strategy-value-deals-2025

The Future of Franchising: Trends and Predictions for 2025 and Beyond

the-future-of-franchising-trends-and-predictions-for-2025-and-beyond

Layoffs Surge to Pandemic-Era Highs, Opening Doors for Franchise Growth

layoffs-surge-to-pandemic-era-highs-opening-doors-for-franchise-growth

Restaurant Business: Crumbl Cools Its Expansion, Refocuses on Profitability

restaurant-business-crumbl-cools-its-expansion-refocuses-on-profitability

Franchisee spotlight image with Randy and Sandy Craft, Children's Lighthouse logo on blue background

The Crafts’ Successful Journey from New Parents to Children’s Lighthouse Franchisees

the-crafts-successful-journey-from-new-parents-to-childrens-lighthouse-franchisees

Franchisee spotlight image with photo of Robert Trujillo and UWRG logo on blue background

How Robert Trujillo Expanded His Construction Business With UWRG

how-robert-trujillo-expanded-his-construction-business-with-uwrg

District Taco Franchise Costs, Fees, Profit and Data for 2025

franchise-deep-dive-district-tacos-franchise-costs-fees-profit-and-data

The Ultimate Guide to Selling Franchises: Building Your Brand’s Growth Machine

ultimate-guide-to-selling-franchises

1851 Growth Club: Honest Commission Model

MORE STORIES LIKE THIS