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Take a look at 2007's 101 fastest-growing franchises--but blink and you miss your opportunity.
Maybe you’re the type of person who needs everything done yesterday. You’re the one who’s always asking others, “What took you so long?” You can buy fast cars, order same-day delivery or go on a speed date, but you can’t buy a fast business, right? Wrong. There are franchises that are of the same mindset as you--they’re on the fast track to growth.
These franchises come in a surprising array of categories. You can hook up with a fast franchise whether you’re interested in buying a fitness center or an ice cream shop. The listing below provides you with a quick look at the 101 franchises that grew the fastest over the past year.
This ranking is based on growth in the number of U.S. and Canadian franchise units from 2005 to 2006, as verified by Entrepreneur magazine’s Franchise 500®. Ties are listed alphabetically. This ranking is not intended to endorse any particular franchise, but rather to provide a starting point for your research. You must also conduct your own due diligence, which consists of thoroughly reading a company’s literature and its Uniform Franchise Offering Circular, calling and visiting existing franchisees, and consulting with an attorney and an accountant. You should only buy a fast-growing franchise after taking the time to conduct a careful investigation.
For the complete list of franchises from Entrepreneur’s 28th Annual Franchise 500®, go to http://www.entrepreneur.com/franchise500/index.html.
Published: Sunday, January 21, 2007
Tom Kelly
Herald columnist
NEW YORK - The comment simply added an international flavor to what has become an ongoing wrestling match about real estate commissions. In fact, "60 Minutes," the popular CBS program, even showed up to shoot video at the Real Estate Connect NYC Conference.
Simon Baker, an Australian real estate executive, was part of a panel discussing real estate purchasing trends among wealthy people. Many high-end agents based in the United States had explained how they had contacts and clients in foreign countries - Russians, Germans, Italians, Japanese - who had come to the U.S. and bought expensive homes and apartments.
"But if you have a U.S. client looking to buy abroad, don't expect to receive a commission or a referral fee," Baker said. "Commissions are a lot lower in other parts of the world. They are 1.75 percent in the U.K., 2.2 percent in Austria, about 2.5 percent in New Zealand. Nobody gets as much as you get here, so enjoy it while you've got it."
Ah, commissions. If you want to tweak some tender nerves, bring up the subject with friends in the business. The debate on commission fees has been going on for decades but was fueled anew by a controversial November exchange in Southern California between Allan Dalton, president of Move Inc., representing the traditional or full-service side, and Zillow co-founder Lloyd Frink.
That's why "60 Minutes" showed up for the "High Tech vs. High Touch" panel here featuring Dalton, who seems to have become the chief spokesman for the National Association of Realtors, and Glenn Kelman, chief executive of Seattle-based Redfin, which offers an alternative service and commission structure. The topic is so popular that the conference also included a late-afternoon roundtable titled: "The Commission Conundrum: Maximizing Value in a Changing Market."
In a capsule, Kelman maintained some consumers preferred the lower cost structure and low touch approach (little or no "face time"), while Dalton argued that sellers would not know what price "they could have gotten" unless they used a full-service agent.
In fact, Dalton would like to see real estate agents move from the role of nurturing consumers through one deal to more of a lifelong real estate planner, helping them understand how property can fit nicely into financial portfolios.
By law, all commissions are negotiable, yet it's been common practice that real estate representatives historically have received a 6 percent commission on the sale of residential property for homes priced $300,000 and less in many of the country's markets. Of that total, the selling side receives a 3 percent commission on the sales price and the listing side receives 3 percent. (Years ago, the selling side received two-thirds; the listing side one-third). Some traditional companies have reduced their commissions, others introduced a "discounted fee" structure while a few have gone to a "menu" or "a la carte" system.
Seven years ago, when Gomez, a research firm specializing in the measurement of customer experiences, released a study showing that online consumers wanted better service and lower fees and were willing to take a more active role in the home buying and selling process, real estate agents first began to consider a menu or ala carte approach to the sales process.
Richard Mendenhall, then president of NAR and perhaps the strongest leader ever to guide the country's largest trade association, was asked to comment on the Gomez report.
"What will drive the change?" Mendenhall responded. "I think you will see the market dictate change. If Realtors can execute more deals in the new model, then they will move to that model."
Kelman says his agents are now grabbing significantly more deals than conventional agents, yet some agents still prefer to work under a more traditional system. Under the Redfin set-up, the buyer gets back two percent of the three percent selling side. The company says the average refund is $11,402.
The Redfin model is aimed at computer-oriented professionals who know how to search their desired neighborhoods online and have an idea of the type of home they would like to own. Once a home is targeted, customers visit open houses, and then contact Redfin when they are ready to write an offer through the company's "online wizard." A Redfin agent then contacts the listing agent to ascertain the seller's needs and expectations, then critiques the offer and negotiates with the seller's agent.
If the deal is accepted, Redfin says its agents stay in the loop via telephone, coordinating the appraisal and inspection plus escrow and title insurance services. It's this portion of the transaction - after the purchase and sale agreement is signed - that has drawn the attention of traditional agents. Many of them feel that discount brokers disappear once the contract is "signed all around," leaving the listing agent to perform all the chores needed until closing.
Where's the answer? Somewhere in between. Consumers want to sit down at a table and write up a deal with an agent, face to face, and know that the agent will go to bat for them. Yet, many also want lower fees. A majority of consumers is opposed to the perception of being involved with a "discount broker," while a niche could care less. Acceptable fee changes will come only from a well-defined, real estate menu that includes face time. And that menu will not be jump-started in a flat market.
Tom Kelly's book "Cashing In on a Second Home in Mexico: How to Buy, Rent and Profit from Property South of the Border" was written with Mitch Creekmore, senior vice president of Houston-based Stewart International. The book is available in retail stores, on Amazon.com and on tomkelly.com.
