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Keep your brokers and portals. Add your own ads, and track every source to the signed agreement. Then compare cost per signed franchise side by side, and let the budget follow the numbers.
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| Franchise portals | Franchise brokers | Your own ads | |
|---|---|---|---|
| How you pay | Listing fees or per lead | A fee when a franchise is awarded | Ad spend plus management |
| Where the candidate arrives | Browsing many brands at once | Introduced by a broker; assess against your own rules | Can arrive at different stages of the decision |
| Who owns the data | Shared with the portal | Governed by your written broker agreement | You: pixel, leads, audiences |
| What you control | Your listing | Your broker relationships | Message, audience, form, budget |
| What it needs | Fast follow-up | A ready sales process | Tracking, grading and creative |
None of them is the answer on its own. The answer is knowing what each one costs per signed franchise.
By Sell More Franchises / Digital Rocket · Updated October 29, 2026. Worked figures below are fictional teaching examples.
Let observed coverage and capacity decide, not geography. Where your own records show paid ads producing few Qualified candidates for a territory, and a broker can show candidates there, a broker may fill it. Where your records show paid producing local Qualified candidates and your reps have hours to work them, paid may be the better fit. Decide on included cost per signed franchise, measured on the same cohort, over the same window and with the same cost lines on both sides. In the worked example below, the answer is a mix split by territory rather than by preference.
The hard part is not the formula. It’s that a broker figure and an ad figure are usually measured differently, and the gap between them can flip depending on when you look. This guide gives you a seven-factor choice matrix and one fully worked comparison that shows both traps.
Score each factor for your network. A factor doesn’t decide on its own; the pattern across all seven does.
| Factor | Leans broker when | Leans your own paid ads when |
|---|---|---|
| Territory constraints | Your own records show paid producing few Qualified candidates for the territory, and the broker can show candidates there | Your own records show paid producing local Qualified candidates for the territory at a volume reps can work |
| Control and data | You accept the broker managing the early relationship under your agreement | You need the record, source and remarketing audience in your own CRM and ad accounts |
| Candidate readiness | You need candidates who have already explored franchising | You can teach candidates who know your brand but not the franchise model |
| Rep capacity | Reps are near capacity and need fewer conversations per signing | Reps have spare hours to call, teach and nurture larger volume |
| Economics at matched age and scope | The broker figure sits under your ceiling once staff time is added to both sides | The paid figure sits under the ceiling and the observation window is complete |
| Fee structure and cash timing | You prefer paying on success and can absorb a large fee per signing | You can fund spend months before signings arrive |
| Evidence strength | Either side: a handful of signings per source is an observation, not proof | Either side: repeat over more than one matured cohort before moving large budget |
Two of these rows are easy to leave out of a cost comparison. Territory matters because a source that is cheaper on average can still be useless for the territory you actually need to fill. Rep capacity matters because a paid channel that needs four times the conversation hours per signing will stall if nobody is free to call.
Northfield Inspections is a fictional US home inspection franchisor used throughout these guides. It has 14 open territories: 9 in metros and 5 in secondary markets such as TX-ABI-01 (Abilene) and TX-TYL-01 (Tyler). It runs Meta and Google ads and has one broker agreement paying a fictional $25,000 success fee per signed agreement. Two development reps share 600 candidate hours a quarter. Staff cost uses the house default: logged rep hours x a loaded hourly rate. The base case is $35/hour, with $50/hour as the high case. These are researched planning assumptions, not Northfield or SMF payroll data.
The comparison follows everyone who first inquired between 1 January and 31 March 2026. The cutoff is 30 September 2026, so every inquiry has at least 183 days of observation and a 180-day window is complete for all of them. Cost cutoff: the same date. Included cost is every cost attributed to this cohort and incurred up to 30 September 2026: success fees on signings by then, media, management, production and tools for the Q1 campaigns, and rep hours logged against cohort records by then.
| Line | Broker | Own paid (Meta + Google) |
|---|---|---|
| Inquiries (unique people) | 12 | 330 |
| Graded / not yet graded | 12 / 0 | 316 / 14 |
| Qualified | 7 | 55 |
| A. Direct source cost | $50,000 (2 success fees) | $35,750 (media $27,000 + management $6,750 + production and tools $2,000) |
| B. Rep hours logged | 20 | 185 |
| C. Staff allocation (B x $35) | $700 | $6,475 |
| D. Included cost (A + C) | $50,700 | $42,225 |
| E. Net signed within 180 days | 2 | 5 |
| Included cost per signed franchise (D / E) | $25,350 | $8,445 |
| Rep hours per signed franchise (B / E) | 10 | 37 |
| Still open at a late stage | 1 | 6 |
On a matched basis, paid costs about a third as much per signed franchise. It also takes 3.7 times the rep hours per signing. Both facts belong in the decision.
| Rate case | Broker staff cost / included cost / cost per signed | Paid staff cost / included cost / cost per signed |
|---|---|---|
| Base, $35/hour | $700 / $50,700 / $25,350 | $6,475 / $42,225 / $8,445 |
| High, $50/hour | $1,000 / $51,000 / $25,500 | $9,250 / $45,000 / $9,000 |
The high-case broker-to-paid cost-per-signed ratio is 2.83x. The 3.7x rep-hours ratio is unchanged. Neither rate changes this fictional territory decision or makes it a proven source-performance result. If time logs are missing, use the labelled graded-inquiry fallback, not a silent zero staff cost.
Put the broker’s fee next to media-only ad spend and you get $25,000 per broker signing ($50,000 / 2) against $5,400 per paid signing ($27,000 / 5). That makes ads look 4.6 times cheaper. With management, production and rep time on both sides, the included-cost ratio is 3.0 times ($25,350 / $8,445). The broker fee is close to a full cost. Media spend is a partial one.
Look at the same cohort at day 90 instead of day 180. Both broker signings had happened by then (days 61 and 87). Only one paid signing had (day 88).
| Reading | Broker | Own paid |
|---|---|---|
| Day 90 | $50,700 / 2 = $25,350 | $42,225 / 1 = $42,225 |
| Day 180 | $50,700 / 2 = $25,350 | $42,225 / 5 = $8,445 |
At day 90, brokers look cheaper. At day 180, paid does. Nothing changed except the time allowed. This is a sensitivity calculation, not a reconstruction of the day-90 cash report: included cost is held at the 30 September cutoff total in both readings, so only the signing count moves. A report actually run at day 90 would have shown less rep time and different cost totals. In this example the broker candidates arrived further along and both broker signings landed before day 90; check your own signing dates before assuming that pattern holds. Judging a paid channel too soon can lead you to cut a source before its signing outcomes are visible.
| Factor | Northfield evidence (fictional) | Reading |
|---|---|---|
| Territory | 52 of 55 paid Qualified and all 5 paid signings were in the 9 metros. Both broker signings were in secondary territories | Paid for metros, brokers for secondary markets |
| Control | The broker agreement credits the broker for any introduced candidate for 12 months | Tag broker records at entry; build owned audiences in metros |
| Readiness | Broker Qualified rate 58.3% (7 of 12) vs paid 17.4% (55 of 316 graded) | Readiness favors brokers, volume favors paid |
| Capacity | 566 of 600 rep hours used in Q3 | No extra paid volume until hours are added |
| Economics | $8,445 paid vs $25,350 broker; the CFO’s fictional ceiling is $20,000 | Paid clears the ceiling; brokers don’t, but fill territories paid misses |
| Cash timing | Broker fees fall due at signing; paid spend is incurred up front | Brokers stay the variable-cost channel |
| Evidence | One matured cohort, 2 broker and 5 paid signings | Re-check when the Q2 cohort’s 180-day window closes on 27 December 2026 |
Decision: keep the broker agreement for the 5 secondary territories only. Keep paid ads on the 9 metros at current spend, because the team has no spare hours to absorb more volume. Review both with the next matured cohort. That is a decision under uncertainty with a dated review point, not a verdict on brokers.
A broker introduction may later click your ad. Your broker agreement decides who is owed the fee. Your marketing report decides where the signing sits on the source table. Record both: the contractual credit as its own field, the original source as captured at entry, and the touchpoints you observed. Don’t let an attribution setting quietly rewrite a contract term, and don’t let a contract term erase what the ads contributed. The field design is in source tracking.
Grade every source against the same written standard. Broker candidates may need a different first conversation, but if the grade bends for one source, the comparison above stops meaning anything. The shared grading rules are in qualifying franchise leads.
Pull last year’s broker invoices and your paid costs for one inquiry quarter that is at least six months old. Fill in lines A to E for both sides, including rep hours. Then add the territory ID to every signing. If the two sources are filling different territories, you are deciding a territory plan, not a winner.
Download: O06-source-choice-matrix.csv (the seven factors with Northfield’s evidence) and O06-broker-vs-paid-comparison.csv (lines A to H with both traps). All Northfield costs, hours and outcomes are fictional; the staff-rate assumptions are researched.
For the separate decision about fee structures, see the franchisor broker-fee model.
Related: Candidate sourcing scorecard for all sources side by side · Cost per signed franchise for the calculation method · Recruitment report for how this decision appears in a quarterly report
Franchise broker fee calculator. Enter your own records and assumptions. The tool does not store your inputs; its example figures are fictional.
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Questions franchisors ask
No. We never tell a franchisor to stop their brokers. Keep them running, track them next to your own ads, and let cost per signed franchise decide where the next dollar goes.
Compare your own source cohorts at the same age, with the same cost scope and qualification rules. A lower cost per inquiry does not establish a lower cost per signed franchise.
Not by default. Portal candidates are often looking at several brands at once, so speed and grading matter more. Grade them with the same rules as every other source.
Keep marketing attribution and contractual broker credit separate. Preserve the observed source history and apply the terms of the written broker agreement to any fee.
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