Franchise Broker vs. Franchise Consultant: What is the Difference?

If you're considering going into franchising, you may find yourself in need of professional assistance. Two common options you'll encounter are franchise brokers and franchise consultants. 

While both provide valuable services, there are distinct differences between the two. Here’s a look into the roles of franchise brokers and franchise consultants, and how to determine which one is better suited for your franchising needs.

Franchise Brokers: Matching You with the Right Franchise

Franchise brokers act as intermediaries between prospective franchisees and franchisors. Their primary goal is to match individuals with the most suitable franchise opportunities based on their skills, interests and financial capabilities. They typically have relationships with multiple franchisors and a thorough understanding of the franchise market.

By working closely with prospective franchisees to assess their preferences and requirements, brokers help identify franchises that align with the individual's goals. By leveraging their extensive network of franchisors, brokers can then facilitate connections and arrange meetings between the parties involved.

In many cases, brokers’ services are free; they are paid a percentage of the franchise fee as outlined in other franchise documents. However, this does not change the cost of the franchise for the prospective franchisee. Rather, it is a commission paid by the franchisor to reward the broker’s identification of a great fit to expand the system.

Franchise brokers can provide ongoing support to franchisees after they have chosen a specific opportunity. They assist with additional due diligence, facilitate discussions with the franchisor and help with necessary paperwork. This is particularly beneficial for new franchise owners with limited experience in the franchise agreement process.

Franchise Consultants: Guiding You through the Franchise Process

Franchise consultants offer guidance and support to individuals with less experience in the franchising industry. They assist both franchisors and franchisees in achieving the common goal of establishing a successful franchise unit.

These independent professionals work directly with prospective franchisees to help assess their skills, interests and financial resources, similar to brokers. However, consultants go a step further by assisting with market research, business plan development, legal compliance and ongoing support after the franchise is established.

Unlike franchise brokers, consultants are typically paid by their clients on a fee-for-service basis. 

Choosing the Right Option for You

Deciding between a franchise broker and a franchise consultant depends on your individual needs and preferences. If you are confident in your ability to research and evaluate franchise opportunities independently, a broker can provide valuable connections and save you time by narrowing down your options. 

If you seek a more comprehensive approach and want ongoing support, a franchise consultant might be a better fit. Consultants can guide you through the entire franchising process, from initial exploration to post-launch operations, ensuring that you make informed decisions every step of the way.

Ultimately, your choice may also depend on your budget. Brokers generally do not charge fees to prospective franchisees, while consultants typically require a payment for their services.

Either way, both franchise brokers and franchise consultants play essential roles in the franchising industry and can be invaluable resources to help you thrive in your new career.