Are Broker Leads Any Good?

Franchise Broker Leads

Many of the franchise broker groups advertise “Leads Provided!” which begs the question, where do they get the leads and are they any good. We will answer the latter first with a resounding “meh, they are OK at best”.

Before we explain how most broker groups produce and provide leads to their brokers first we will tell you why… It is another way for them to profit off of brokers. In it’s simplest form most of these groups are wholesalers of leads produced from other websites and franchise directories. They are often referred to as portal leads but then rebranded as something catchy like “Success Leads” or “Top Producer Leads”.

Franchise broker groups are not the only ones that do this, in fact there are many 3rd party leads groups who basically do the same thing. They buy in bulk for a reduced rate, jack the price up a bit and sell retail to brokers. Nothing wrong with that as countless industries have wholesalers, but don’t kid yourself they commonly find other ways to water down the product to maximize profits. Some of the most common ways are selling the same lead to multiple brokers, recycling old leads and taking a lead for Franchise A and pretending the lead also requested information on Franchise B, C and D.

Something you may not know is that one of the most common reasons franchisors pay these big commissions to brokers is so they can avoid spending as much time and money chasing these same web site leads. While a broker group may tell you the close rate is 1 in 100 or 1 in 150 the industry average is closer to 1 in 250. This will vary among lead sources but it’s close. At an industry average of say $35 per lead a broker may spend upwards of $9,000 on leads to make a sale, not to mention the countless hours spent trying to chase them down.

One of the most common complaints brokers share about these wholesale leads is quite often they are told, “you are the 10th broker that has called me” even though most lead sources will claim the leads are exclusive to just one broker.

Good franchise brokers are always looking for new and unique ways to find leads as is the case with any business. Yes there are deals to be had with these website leads but they are somewhat like playing scratch off lotto tickets.

One big common denominator among top producing franchise brokers is they tend not to use wholesale leads programs and instead take total control and ownership of their marketing.

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