Are you associated with, or are you thinking of becoming associated with a franchised real estate company?  May I tell you that while being associated with a large franchise can be prestigious, and you may think that you will get more business by being associated with a franchise…. The truth is being associated with a franchise is not in your best interest. Franchises are NOTabout helping you, the agent, succeed. Franchises are all about helping the broker be profitable and make the franchise more money.  Remember, the agents are not the franchise’s customer, the broker is.

Think about this; someone who wants to make hamburgers does not buy a McDonald’s franchise to make the best hamburger, they buy a McDonald’s franchise to make money, and McDonald’s is not in business to make the best hamburger, but to make profits from those who own the franchises.

Real estate franchises and their brokers expect the agents to bear the costs of operating the business. Some franchise fees are so steep that many agents can’t afford them once they sign on and it is difficult to leave and re-brand yourself so soon after you have just left the last company.

If you expect to get business by being associated with a franchise, be prepared to pay dearly for the “help.” Many franchises charge the agents for referrals and relocation business, and those charges are very expensive to the agent, and may not be worth the effort or profit to make the sale.  Many brokers charge agents as much as 30 percent of the commission for a broker referral (on top of the agent split), and brokers will only give the referrals to agents that produce to ensure a successful sale and closing. So if you’re new, you’re not likely to get many broker referrals or franchise relocation clients.

So what do you get for being associated with a large franchise? You get to pay hefty sums of money and large portions of your commissions to be a part of “THE LARGE COMPANY NAME.”   Did you know that while you may be recognized as belonging to the large franchised real estate company, that only 3% of buyers and sellers chose a specific agent because the agent was affiliated with a particular franchise? Most buyers and sellers choose their agent based on perceived or proven honesty (24%), reputation (21%), friend or family referral (15%), knowledge of the local housing market (12%), and a person who genuinely cares for their customers (9%).


Give us a call to set an appointment, and we will not only tell you what we can do to help you grow your business, we will put it in writing.

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