The Canadian franchise industry is second in size only to the
US, employing over 1.5 Million people. As a Franchisor you
recognize the potential for growth in the Canadian market but
aren't sure how to approach it? Are you considering using a
A franchise broker, or franchise consultant, acts as an
negotiator between the franchise company and a potential buyer of a
franchise.The topic of using Franchise Brokers is one of the most
controversial in lead generation. Franchise Brokerage Networks now
account for about 10% of all franchise sales.
Pros for selling franchises in Canada through a
- Brokers have a large network to work with.
Their franchise advertising networks can reach thousands, possibly
resulting in faster leads and sales than the advertising and
marketing your franchise by yourself.
- Brokers specialize in building professional business
profiles for your franchise listing. This listing package
should also include your equipment list, your asset list and your
past and present financial statements.
- Brokers are experienced with franchise pricing
guidelines. This is important since some franchises do not
sell simply because they are priced too high. Brokers are good at
finding special financing options to offer potential buyers.
- Brokers can save you time by making sure
potential buyers are qualified to purchase your franchise. Because
their goal is to sell your franchise, they will only refer
qualified buyers to you who are ready to make you serious
Cons for selling franchises in Canada through a
- They can be expensive. Some brokers charge
upfront fees and ongoing monthly fees, as well as a sale percentage
for their commission. This can be expensive to your franchise,
especially if you have not sold a franchise yet.
- Knowledge of franchise service and products.
Some brokers may not be qualified to understand and deal with the
requirements of your particular type of franchise. It is important
to make sure your broker knows the in's and out's of your field in
- Reaching buyers is easier than it used to be.
Thanks to the internet, if you have the time, you can broker your
own franchise effectively. There are numerous quality Websites and
social networks that you can use to sell your franchise online
without the help of franchise brokers.
Making the Decision
When deciding whether to use brokers to sell your franchises in
Canada, it is important to base your decision on your marketing
budget and the time you have to invest in the project. Here are two
things to help you make a qualified decision:
- If your main goal is to save money, you will have to put more
time into selling your Canadian franchise to yourself.
- If main focus is saving time, it may make more sense for you to
use a broker who specializes in selling franchises in Canada.