A franchise brokerage, or franchisor, provides a business system with marketing, technology, and other support that is executed at the local level by regional operators, or franchisees. Franchisors help prospective broker owners quickly stand up a brokerage operation. The franchisor provides a national brand with credibility and a proven system. And franchisees pay a fee to the franchisor.
Over 40% of real estate agents are associated with a franchise. This means that national franchises have a large impact on industry practices. But this is also why the quality of one brokerage under the same brand name can vary so significantly from one region to another.
Franchise brokerages are operated by different people in each location. Support teams are often not centralized, with each franchisee handling local operations. Traditional brokerages often have a single leadership team and support staff. But they usually have regional or office support as well. This means franchise agents are often closer to local management than to the brand.
Franchise brokerages almost always employ agents as independent contractors.
Keller Williams and RE/MAX are two of the largest franchise brokerages in the US.