What are Franchise brokers roles? Do the add value in the process?

The best way to think of Franchise Brokers is like real estate agents. They get a commission if a franchise is sold and mostly live on the commissions they generate.

As long as you understand their motivations, I think they can add a lot of value. They keep abreast of all the new franchises and have former customers that they can contact on your behalf to get the inside scoop on a franchise. As with anything else it is really depending on the broker so make sure you select a good one.

They do add value if you get an experienced one. Some of the questions you should ask are:

-How long have you been in the business?
-How many franchises do you represent?
-What differentiates your firm from other brokerages?
-How many franchises have you sold in the last year? How many ________ franchises did you sell (the ones you are looking at)
-Can you provide me with some referrals?

Franchise brokers get paid by the Franchisor so it is to your advantage to use one and enjoy the benefit of their experience.

A couple of additional questions you may want to ask:

-What has been the experience of other people who have bought this franchise?
-Can you provide me with the UFOC and other related documents prior to me talking to their sales person?
-How doe the process work and what is your relationship with the Franchisor?
-Are there any Franchises in the industry I am looking at that you do not represent?

It is precisely because they work for the franchisor that it is NOT in your best interest to use a broker. It is in the franchisor's best interest. The broker makes his money from the franchisor when they sell a franchise. Why is this not good for you? They will steer you in the direction of the franchises that they work for. Not necessarily the one that is best for you.

Anything a franchise broker does, you can do yourself.

UFOC's are distributed freely. All you need to do is ask.

Do your own research. Read through the Franchise Handbook magazine (found in any magazine stand). Look through the tiny ads too. Don't be drawn to just the glossy ads. There are many, many great and affordable franchises out there.

I am a franchise owner and speak from experience. I offer a very comprehensive manual on how to choose the right franchise below.

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Sylvia
http://smallbusinessstartup.BIZ
Small Biz Startup & Business Plan Help

It has been our experience that a lot of Franchisors are reluctant to provide the UFOC for good reason they contain proprietary information and can be over 400 pages. They typically like a client to be further along in the sales process to get a copy. Some even require a visit. I agree with the other comments that you should approach brokers with caution. But franchise brokers are exactly like real estate brokers. As long as you know the properties they represent and the limitations it is worth using them because they know the ins and outs of the franchises they represent - like in a real estate transaction we recommend you do research on your own and even consider using multiple brokers who represent the franchises you are looking at.