Sales-Based Franchises: Cashing in on the B2B Sector

If you’re a disillusioned senior salesperson looking for a future that isn’t attached to a company whose success is beyond your control, you might think that your only option is a full career change. But before you dust off your expired commercial driver’s license, consider the potential of starting a sales-based franchise.

What is a Sales-Based Franchise?

Simply put, a sales-based franchise is the classy, corporate ideal of a business-to-business senior salesperson merged flawlessly with the 1950s ideal of the self-made door-to-door salesman through the magic of franchising. In a sales-based franchise, you work for yourself, as owner and (often sole) employee of a franchise built around your ability to sell products to businesses.

Some sales-based franchises are attached to a particular product line; others offer products from several different manufacturers within the same industry. This new brand of ‘hybrid sales’ has proven extremely effective in a variety of markets, including:

The Hybrid Sales Model vs. The Old ‘Employee/Contractor’ Dichotomy

You might be looking at this and thinking “wait, doesn’t this just mean I’m a salesman for the company, but I’m not an employee in this scenario? How is this any different from being an independent contractor?” It’s very different, and it’s very different almost entirely in your favor. Here’s why: as a franchisee, you have a lot of benefits an independent contractor doesn’t, including…

  • Independent Direction: Independent contractors are often micromanaged even more harshly than standard employees. As a franchisee, you’ll have a business plan to follow, but the day-to-day operations and your activity under them are entirely your own to decide.
  • A Guaranteed Job: An independent contractor can be severed at any time by the parent company. As a franchisee, you sign a contract that ensures you cannot be ‘fired’ for the duration of the franchisor-franchisee relationship. This contract is typically renewed regularly as long as it is satisfactory to both parties.
  • Ownership: If and when you do sever your relationship with your franchisor, you will have an asset you own, clientele you have built and the ability to potentially sell it for a large sum of cash. Unlike an independent contractor that generally walks away with nothing, you are able to enjoy the fruits of your labor even after you leave the company.

A Word of Warning!

There absolutely are some businesses out there that are using the ‘franchised salesman’ model strictly to hire a sales force that they don’t have to provide with benefits, insurance, and other perks of traditional employment. Before you sign up to become a sales franchisee, you need to examine the franchising contract very carefully with two questions in mind:

  1. Does my franchise exist apart from its relationship with the franchisor (i.e. if the franchisor went out of business, could you continue operating by, for example, finding another vendor to sell the product or service)?
  2. Do I control what will be done and how it will be done, with the franchisor only directing the result of what I’m doing?

If your franchise is 100% dependent on the existence of your franchisor, or if the franchisor actively directs the daily activities of the business, you’re not actually a franchise — no matter what the contract (and royalty check stubs) say. Not every sales-based franchise you can get into will fall into this category, but we would be remiss to not mention that they exist.

Those few unscrupulous pseudo-franchisors aside, the sales-based franchise sector is young, vibrant and growing fast; if you have the sales experience and the chops to bring in the big bucks under no one’s supervision but your own, this is one of the best franchise business opportunities for the 21st Century.

Whether you’re searching for a sales-based franchise or a franchise opportunity in a different industry, there are hundreds of brands and business models to choose from. Going directly through each company, you will end up dealing with numerous franchise recruiters all trying to sell you on the benefits of partnering with their brand. A better way to find your ideal business is to work with a franchise broker.

At Franchise City, we provide unlimited complimentary franchise consulting as well as a unique, proven 20 step process to help clients find the business that best fits their passion, skills and budget. And the best part; the franchise fee is exactly the same whether you work with a broker or go directly through the company recruiter. For further information about sales-based franchise opportunities, contact us filling out the form on the bottom of this page.

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