Get a better understanding of the difference between brokers and consultants, and learn the best practices for having a successful relationship with your referral network.
Over the years of working with varying stages of franchisors, it has become clear that there is a wide range of opinions on whether it is a good idea to have brokers and consultants in your franchise lead generation strategy.
I want to share some incredible takeaways from one of the recent AC Roundtables — all about the strategies that actually work when it comes to getting effective candidates through broker relationships.
The Difference Between a Broker and a Consultant
First, let’s get clear on the difference between a broker and a consultant. These specialists help franchise seekers find franchise opportunities and give franchisors qualified leads. They are paid commissions once a deal is closed.
Broker is a term most often used in Canada while consultant is the more popular term in the United States. Even though the same person serves a dual role as broker (for the franchisor) and consultant (for the franchise seeker) on the same franchise transaction, there are distinct differences between the two terms and their roles that are worth noting.
Brokers are paid by a third party — like the franchisor, for example. Consultants, on the other hand, serve the potential franchisee, providing free services, similar to the way a Realtor serves a home seeker. While consultants do not need to be licensed, many go through extensive training programs.
Ultimately, these distinctions are good to know, but if you receive solid, qualified leads, that is the most important part of your decision of which referral network to align with. For the purpose of this article, we’ll use the term broker.
How Do I Find a Franchise Broker Referral Network That’s a Good Fit?
There are a lot of broker networks out there. Align with one that has great testimonials, industry recognition, and a reputation for innovation and excellence. Once you are part of a broker network, take advantage of all it has to offer. Seize opportunities to put yourself in front of brokers and get to know them personally. Talk to brokers, meet with them, engage with them, and eventually you will have built solid relationships with franchise brokers who understand your brand and will send you qualified, quality leads.
It’s All About the Relationship
The success of working with referral networks is all about active participation and developing relationships. And where we start to see things go downhill is when the relationship is not built and nurtured properly. It’s old-school thinking that to get brokers to send you leads, you need to wine and dine them. What really gets a broker’s attention is a collaborative approach and proven results.
Brokers want to work with reputable brands. They want to know that when they send you a lead, their candidate will be properly taken care of. They want to know that the franchisor will be responsive and have a structured sales process. They also want to be included in the process and updated on the progress.
To create this awesome, mutually beneficial relationship, effort must be made by both parties. Even though money is being exchanged, there is a lot more to a relationship than exchanging dollars for a service. Clear, consistent communication about results, and cultivating mutual respect will lead to a more successful relationship.
Now that we are clear on the definitions and common problems, here are three tips for how to best utilize a franchise broker referral network:
#1 – Seek Out Alignment and Energy from a Franchise Broker Network
When considering a franchise broker referral network, confirm that they provide opportunities to meet and build relationships with brokers. Once you commit, make sure you are using all the resources your referral network has to offer.
As you are seeking out the right referral network for your franchise system, be ready with questions that will help you determine if your brand will have plenty of opportunities to get noticed by brokers. If you have some non-negotiables when it comes to your franchise candidates, don’t assume every broker will understand these right away. Go over these key qualities, qualifications or attitudes to help save you and your broker time and effort.
#2 – Give Recognition and Appreciation to Franchise Brokers
Everyone wants to be recognized and appreciated! Give your broker recognition when you share a deal announcement. Connect on LinkedIn and actively engage with their posts. When you are willing to show your gratitude and commend brokers on results, they’ll know it’s worth sending qualified people your way.
#3 – Send Regular Updates about Franchise Candidates
This strategy goes back to my note on consistent communication. Send an update to your broker on the success of their latest franchisee lead and they will see the results that you can deliver on your end. Your broker WANTS you to close the leads they send you. Not only is this money in their pocket, but it boosts their reputation and encourages them to send you more solid leads.
I would even suggest you take the time to give them updates on leads that don’t work out as well. Taking the time to explain why a lead didn’t move forward shows that you care about the leads they are sharing with you and you’re still treating them with respect.
In summary, working with franchise brokers can be a fantastic way to find franchisees who are just right for your brand IF you put in the effort to get it right with them.