The head of a major real estate franchise group in Western Australia has cautioned principals about getting into franchising.
Geoff Baldwin, regional owner of RE/MAX WA, claimed it would be a waste of money for some agents to join a group.
“I have been managing or owning major franchise brands for over a decade, and during that time I have interviewed hundreds of agents considering the franchising option,” he said.
Mr Baldwin estimated that only half of the people he screens end up in his network. “And of the remainder many would not take advantage of the benefits and would be wasting their time”, he added.
“Although there are some notable exceptions; older, long-established independent agents usually battle with the changes required to take full advantage of joining a franchise system as do some younger, brash agents who have a need to conquer the world with their own name in lights.
“There is also another breed of agent who will join a franchise system and then insist on doing everything their own way, with the result that they miss out on enormous opportunities and, in so doing, waste their investment.”
Mr Baldwin's comments reflect similar views outlined in a Real Estate Business report in 2012 entitled Switching Networks, which found while franchises were a viable option for many in the industry, some were too quick to blame the franchisor for problems that often had more to do with how they were managing their business.
“A franchisee has a right to expect a return on the investment they make in joining a group, and the best way to measure that is by increased business they achieve as a result of joining," Mr Baldwin continued.
“It's also important to join a group that recognises that it is its people who depict its success and not the brand itself, and that if the group empowers its people, then the brand cannot help but succeed."