10 Tips to Bigger Broker Success Part 3 of 3
I certainly enjoyed successful broker relationships over the past 20 years. Discovering qualified franchise owners through the professional efforts of franchise and business brokers contributed to the growth of several franchise companies I represented. Based on my personal experience and the insights from hundreds of franchisors who have sold broker-referred prospects, here's how to increase your popularity and closing rates with broker networks.
1. Present your franchise in broker's terms--They want to know what your concept is, what's hot about it, who your buyer is, how responsive and how good you are at closing deals, and what the payoff and other incentives are. Don't try to "build the watch" when you tell them. Just hit the hot spots that will excite and turn them on to your concept. You're competing with broker inventories of 25 to 125 franchises; information overload creates broker confusion and wastes time.
2. Ask what is most important to the broker--Probe their brain just as you do with direct prospects. What are their top motivators? Is it just commissions? Your strong closing skills? Satisfied franchisees? Impressive earnings claims? Your explosive industry? Are they fans of your product? Or are they most interested in working with highly responsive franchisors who call their referrals within 15 minutes of receipt? These insights will help you better screen brokers you want... or want to ignore!
3. Ask how the broker likes to communicate--Does the consultant prefer phone calls or emails, copies of your correspondence to their clients, weekly updates on candidates, or no contact at all unless you have a "hot one" who's a potential sale? Communicate the way they like to communicate. Each consultant is different. Understanding what's most effective for them will strengthen your relationships and bring more deals.
4. Get on their "fab five" list--This is your mission. Some broker systems have more than 100 franchises in inventory. I believe more than half of those are buried in dust, with a handful in the morgue. Do what it takes to move up to the consultant's fab five list and you'll profit. If a broker is hot on your mobile photography franchise, you'll get scores of referrals, since many of their buyers seek low-investment service franchises.
5. All you need are a few good brokers--Cast your net wide to the entire broker and consultant system with calls, emails, and franchise success stories and announcements. Then aggressively lock in on those who show interest in you. Second, contact the broker's headquarters and find out who are the top 12 consultants in the system, as well as the movers and shakers in your region. Personal phone calls and meetings, where feasible, can make a big difference. Selling without focus to the majority is a waste of time. I always targeted recruiting 8 to 10 consultants in each system who would champion my concept to their buyers, and then use them as references when approaching other brokers. I had more than 40 quality consultants across the U.S. from 5 different networks who produced hundreds of pre-qualified candidates for our $400,000 retail concept. The other 600-plus brokers just "didn't get it," or we didn't get them. The disinterest was mutual, so why waste the time?
6. Establish mutual trust or you're headed for disaster--The franchisor and consultant must always trust each other before they trust the buyer. At times a prospective buyer will play you against their consultant.
"Steve Olson still hasn't called me" is a popular one with candidates who won't admit they didn't respond to your two phone calls and email. Or the buyer makes the consultant the fall guy, claiming to you, "Joe told me your franchise takes an unusually long time to get open, and I don't want to experience these problems you have." In reality, this is what consultant Joe actually stated, "This franchise is interested only in premier locations to help ensure greater success for their franchisees. In your local California market, the real estate window for finding, approving, negotiating, building, and opening a prime 'A' street corner location typically takes from 10 to 24 months."
Note: Always side with your consultant first, and immediately address issues before they become problems. If you allow buyers to manipulate the two of you, you both lose. If you do miss a scheduled appointment, "fess up," and immediately tell your broker. Neither of you is perfect. In this case, you admitted the mistake to the consultant, which strengthens your credibility. As always, it's all about communication.
7. View your active broker as part of your recruitment staff--Treat your top consultants with the same respect and sensitivity you accord your own sales team. Praise and recognize active consultants who are contributing to your success. Send personal letters and announcements through their system praising their achievements in bringing new owners to your franchise. It amazes me when franchisors push their brokers and candidates into second-class seats. I don't understand this mentality, since I never cared where a qualified candidate came from. They're all first class and potential contributors to your franchise success.
8. Conduct Discovery Days for your brokers--Inviting select brokers to your headquarters is the ultimate sell. Roll out the red carpet and bring these valued guests into your world to see, feel, touch, and taste your franchise environment. You'll see their eyes sparkle as they discover benefits of your program they never imagined. Your "wow" factors will excite them with a renewed enthusiasm for promoting your franchise. Immersed in your world, they meet with your sales staff, franchise owners, founder, CEO, and other top execs. It's show time, so wine, dine, and show your appreciation as their gracious host. Load them up with mugs, shirts, caps, and product samples so your brand impression travels back to their offices and homes. The payoffs are huge. More than 75 percent of my broker guests sold our franchises. It's well worth the investment.
9. Spread your risk among several systems--A few years back, some consulting networks tried to bully their most popular franchise clients into exclusive listings. Never allow one system to hold you prisoner. Spread the wealth and sign on with more broker networks. It's your safety net. This is what may happen: five months ago your star broker system produced 35 percent of your franchise sales, but today they're blanking out and you have no backup. Recognize that continually shifting external factors will affect the ebb and flow of broker candidates. What if you have a blow-up with a consultant who then raises red flags about your concept throughout the network? Your two star brokers leave the system? A new competitive concept takes center stage? Or the broker system is now hammered by declining lead flow?
10. The more the pay, the more the play--Unfortunately, greater commissions drive greater prospect submissions from the more money-motivated consultants. If you have the cash, go for it and you'll jump up on their favorite list. Personally, I refused to "buy the market" by throwing bigger bucks to further motivate brokers, and I was still quite successful generating sales with average commissions. There's no need to pay top dollar if you have a solid concept, happy franchisees, an effective selling system, and good relationships with your brokers. But the choice is yours!
This is an excerpt from my book, "Grow to Greatness: How to build a world-class franchise system faster." To order copies, click here.
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