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Just like any other business endeavor, it is helpful to get professional support from those who know most of the industry. Although there might be instances that general knowledge is enough, it still pays more to go the extra mile.

Getting a franchise in the Philippines is just like getting ready for a new adventure. The preparations are always extensive, and committing mistakes might be the last thing to think about. As inevitable as it seems, problems may arise anytime during the whole process. It is one of the best reasons why working with a franchise consultant maybe a choice to consider before joining the franchising industry.

Franchising and Franchise Consultants

It is given that franchising is a thriving business for the past years. Every year is a growing opportunity for those seeking business. Hence, researching franchise opportunities tends to be overwhelming for the franchisees given the number of available businesses. Moreover, they may need help in the entire franchise research process while franchisors must see to it that they come up with favorable terms towards their possible leads.

Typically, franchise consultants work directly with franchisors, although they can still offer help and services to possible franchisees. Here are three questions to ponder upon looking for a franchise consultant.

  • What is a franchise consultant?
  • How are franchise consultants paid?
  • Do franchise consultants provide after-sales support to franchisees?

What is a franchise consultant?

Franchise consultants are also known as franchise brokers or franchise coaches, although it is more accepted to call them franchise consultants.

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Franchisors work with franchise consultants to close deals for franchise sales, while franchisees may ask a franchise consultant to help them through the franchise research process. Yet, remember that consultants may be helpful for the first stage of the process but some limitations can potentially hinder a franchise business research.

For example, it is impossible for franchise consultants to represent every business in different industries. With the number of franchises in the industry, a consultant will be unable to give you a full picture of franchises. Given this, you will only have limited information about the franchises presented to you.

In other cases, the franchise consultant can also help you in selecting a franchise location and avoid the possible red flags in franchising.

How to become a franchise consultant? (Eligibilities, Pros, Cons, and Tips)

One of the common questions related to being a franchise consultant is eligibility. Unlike the real estate brokers who need certification and license, franchise consultants provide their services without the client’s demand for proof of eligibility.

Therefore, when you agree to get the services of a franchise consultant, there can be risks involved if you fail to assess the pros and cons right away. Your hard-earned money may eventually end up nothing if you will not also do your part. As an entrepreneur, it pays more to know the business well too.

Yet, do not generalize since not all franchise consultants are ineffective. Some really do awesome work that will make you succeed in the franchise industry. Given this, even for a consultant that is faithful to his/her work, comes another question: What if the most suitable franchise for you is not in their portfolio?

Remember that it is not the franchise consultant’s fault if they cannot give the best information about every franchise. In the process, the important takeaway is that other than the help you can get from a consultant, speaking with a franchisor directly and conducting your own research will open you up to more opportunities.

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Often, these consultants have no exclusive arrangements for franchisors. This allows them to take as many franchises they can handle and represent. If it happens that a consultant has no contract with a certain franchisor, the likelihood of not presenting that particular business to you is very high.

Here are some tips for you:

  • You can avoid the hassle of using a franchise consultant who might not be knowledgeable enough for the franchise you are interested in.  Start utilizing some free research tools that the franchisors make available to you.
  • Remember that a great business has a reputable owner (franchisor). Most of the time, such a business has a website that is accessible, user-friendly, and informative. Moreover, the owner should be readily available to take your calls, answer your questions, and move you to the next step of the meeting.
  • Franchisors should be direct to the point and must allow you to get comfortable his/her franchise business model and management team. They should encourage you to speak with current franchisees and engage with them on how they are managing their franchises from the beginning till the end.
  • Always ask questions. Meeting with franchise owners is a great opportunity for you to compare yourself to them and check if you feel like you have found the right business.

Do consultants provide support after the franchise sale?

Before signing any contract, it is important that you feel at ease with the franchisor. Moreover, you should be comfortable in embracing the business model and in working with the people of the franchise team.

What happens when a franchise deal is closed through a franchise consultant? Is there anything else that the consultant can do for the franchise owner after the sale? These are just common questions from prospective clients dealing with franchise consultants. Here is a simplified answer:

To begin with, franchise consultants are hired by franchisors to look for prospects. In some cases, once the deal is processed, the franchise consultant is eventually taken out of the picture. He/she has nothing to do with the business anymore and any issues that may arise from the point beyond the sale will be settled only by the franchisee and the franchisor only. 

Therefore, the person that puts you into business is not the same person that will be supporting you in operating the business. Aside from that, there is always the risk that you chose the wrong franchise or that the people in the franchise do not coordinate well with you.

Given these possible downsides of having a franchise consultant, you always have the chance to mitigate risks by choosing to research the franchise well and meeting with the business’ representatives that have an interest in the success of the franchise after the sale is made.

Such help may come from the regional and corporate support teams of the business that are experts in helping owners with everything from the beginning until the business becomes stable on its own.

On the other hand, a franchise consultant who has a good grasp of the franchise business can help you out along the way by providing the most important details of the business: do’s and don’ts, expectations, capital requirements, and other legalities.

By assessing these facts, you can have a concrete decision of whether you should seek a consultant’s help or not. Again, there are pros and cons but who knows what is best for you? Only you can have the answer to that question.

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How do franchise consultants get paid?

Franchise consultants are technically salespeople. Given this, they depend on receiving payments from franchisors to make their living. The payment is in terms of commissions on every successful deal.

Do not worry! You are not getting an extra charge for using the services of a franchise consultant. This is because their pay comes from the franchisor directly. For example, a typical franchise consultant can represent around 100 to 200 franchise opportunities. Each successful sale entitles them for a “success fee” which is approximately 40% of the franchise sale.

See? This is an enticing career too just like financial and insurance advisors but this is a highly competitive niche as well. So, if you are considering this field, you should have the skills and not just the knowledge to pitch sales to potential clients.

Final Judgment

If you are a possible franchisee, it is advised that you make a decision with what you think is the best for you and the business. Getting a franchise is a complicated goal at times but is certainly attainable.

It should be a personal choice if you decide to get help from a franchise consultant and nobody should criticize you for having one. This guide summarizes everything that you must know about franchise consultants and we are hoping that you get the best information possible here.
Evaluate carefully the extent and effect of each choice and always trust your judgment objectively. Do not let personal emotions hinder you in the decision-making process as this may just complicate the situation, especially if you are really confused in choosing the best option.

Your Franchise Market family is here to help and guide you in your franchising journey. We aim to assist you by providing a 360-degree solution to all your franchising needs. 

In the end, we hope that you find this guide useful in determining the need for a franchise consultant. Moreover, always stay optimistic all the time. Check more of other useful content and guides at Franchise Market and let us make your franchising experience fruitful and successful.

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Disclaimer: Franchise Market Philippines strives to provide relevant and accurate information in all its articles. However, some information in our articles may differ or might be outdated from what you can see or read directly from the establishments' or businesses’ websites. Please get in touch with us directly for any discrepancies.