Field Guide to Franchises vs. Independent Firms
(Updated July 2006)
According to The 2007 National Association of REALTORS® Member Profile 45 percent of all REALTORS® are affiliated with a franchised company. The decision to join a franchise or an independent firm can be confusing. The pros and cons of each option are examined in this Field Guide. (D. Winchester, Information Specialist)
Contents:
Franchises... | ...or Independents? | What Does the Research Say? | Useful Websites | Books, eBooks & Other Resources
Value of Affiliation
Strong name recognition
Expanded menu of service
Support system
Drawbacks to Affiliation
Loss of identity
Loss of independence
Quality of service
Source: To join or not to join, (Commercial Investment Real Estate, Mar./Apr. 1998).
Visability
80% report that a franchise affiliation improve their ability to acquire listings.
88% report that a franchise affiliation improved their firm name recognition.
Source: 2004 Profile of Real Estate Firms (National Association of REALTORS®, 2004).
 |
nationwide
|
northeast
|
midwest
|
south
|
west
|
| Independent franchise |
33%
|
30%
|
35%
|
32%
|
35%
|
| Independent non-franchise |
50%
|
52%
|
48%
|
52%
|
47%
|
| Franchised subsidiary of natl./regional corporation |
11%
|
10%
|
10%
|
11%
|
12%
|
| Other |
1%
|
1%
|
1%
|
%
|
1%
|
Source: The 2005 NATIONAL ASSOCIATION OF REALTORS® Member Profile
Click here to order The 2005 NAR Member Profile online, or call 1-800-874-6500.
Franchises...
Top 10 reasons for buying a franchise, (Entrepreneur.com, Dec. 2007).
Generation y not now?, (Franchising World, Jan. 2007). Q
Making demographics, research and modeling work for a franchise system, (Franchising World, Dec. 2006). Q
And the Survey Says, Future for Franchise is Bright, (Franchising World, Mar. 2006). Q
Advantages & challenges of franchising, (Franchising World, Jun. 2005). Q
Should you convert your business to a franchise?, (Entrepreneur.com, Mar. 2005).
Which should you choose -- a national or local firm?, (Realty Times, Nov. 2004).
For brokers: franchise affiliation; eyes wide open, (REALTOR® Magazine, Aug. 2004).
A brand world: Cendant’s many signs of success, (National Relocation & Real Estate, June 2004).
2003 Franchise Report; Is it time to brand your company?, (REALTOR® Magazine, July 2003).
To affiliate or not affiliate; What franchise is right for you?, (REALTOR® Magazine Online, Oct. 2002).
Is it time to go franchise?, (REALTOR® Magazine Online, Oct. 2002).
Where have all the sales agents gone? Franchises vs. independents, (National Relocation & Real Estate, Jan. 2002).
Are minorities the future of franchising?, (Franchising World, Oct. 2001). Q
Looming too large? Will the mega-sized firms cast too big of a shadow over the networks of independents?, (National Real Estate Investor, Feb. 2000).
Coaching gives boost to business venture, (REALTOR® Magazine Online, Mar. 2005).
The galvanization of the independent broker, (Realty Times, Jan. 2003).
Independent brokers: How to remain competitive, (California Real Estate Magazine, Aug. 2002).
Small firms dominate real estate industry, survey shows, (Realty Times, Apr. 2002).
How do you define 'independent'?, (REALTOR® Magazine, Sep. 1999).
Undaunted, independents compete successfully, (REALTOR® Magazine, Mar. 1997).
Franchising in Residential Brokerage, (Journal of Real Estate Research, Vol. 28, No. 1, 2006). Q
Factors associated with survival of new Ohio Realtor® Associates , (Journal of Real Estate Practice and Education, Vol. 6, Iss. 2, 2003). Q
Residential real estate brokerage efficiency and the implications of franchising: A Bayesian approach, (Real Estate Economics, Fall 1999). Q
The efficiency of franchising in the residential real estate brokerage market, (Journal of Consumer Marketing, Vol. 15, No. 4, 1998). Q
Measuring the efficiency of residential real estate brokerage firms, (Journal of Real Estate Research, Vol. 16, No. 2, 1998).
Determinants of real estate licensee income, (Journal of Real Estate Research, Vol. 14, No. 1/2, 1997). Q
Franchise vs. New Business, (CCH Business Owner's Toolkit, 2005).
Franchise and Business Opportunities, (Federal Trade Commission, 2003)
Franchise Sources, (REALTOR® Magazine Online, Mar. 1997).
Franchise.com
eBooks & Other Resources
Books, Videos, Research Reports & More
The resources below are available for loan through Information Central. Up to three books, tapes, CDs and/or DVDs can be borrowed for 30 days from the Library for a nominal fee of $10. Call Information Central at 800.874.6500 for assistance.
Working for yourself (Adobe eReader)
Real Estate Confronts the Future, (Mason, OH: South-Western, 2005). HD 1375 SWCR
Business lessons for entrepreneurs: 35 things I learned before the age of thirty, (Mason, OH: South-Western, 2003). HD 2346 C89
Field Guides & More
These Field Guides and other resources in the Virtual Library may also be of interest:
Field Guide to Opening a Real Estate Brokerage
Field Guide to Appraisal of Real Estate Offices
>> Have an idea for a new Field Guide? Click here to send us your suggestions!
The inclusion of links on this Field Guide does not imply endorsement by the National Association of REALTORS®. NAR makes no representations about whether the content of any external sites which may be linked to this Field Guide complies with state or federal laws or regulations or with applicable NAR policies. These links are provided for your convenience only and you rely on them at your own risk.
