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Privately owned property services company takes on traditional franchising

Announcement posted by Writers Who 22 Apr 2021

One of Queensland’s newest success stories in real estate is taking on traditional franchising, saying the old model robs profitable offices to support startups.

Carmel Kellett, the national head of franchising at Coronis, says franchising in Australia’s real estate industry is upside down.

“If you’re a real estate franchise in Australia today the better your business gets the more you pay for the privilege of operating it. It’s counterintuitive,” Ms Kellett said.

Ms Kellett has a career spanning 25 years in real estate, as former CEO with Australia’s longest running real estate brand and now heading up franchising at Coronis, based in Queensland.

The current franchise industry penalises success. The model is structured around franchisees paying a percentage of the office’s commissions each month. The more you sell, the more you pay the franchisor.”

Coronis, a privately-owned real estate business with a track record of training and growing successful agencies and agents, will launch a high-performers only franchise model.

Ms Kellett argues today’s high performing real estate businesses don’t need another generic marketing template or a cookie-cutter training session. They want tangible value. 

“The inequality in the traditional model is that high performing franchisees don’t need as much of what the franchise offers. Today’s successful business owner seeks sustainability in their business structure; they seek improved systems with reduced costs, they want reliable diversified revenue, and an exit strategy.”

“In the incumbent franchise models, your fee is directly proportionate to your turnover. The better you get the more you pay for your franchise despite needing them less and less.”

Meanwhile, the smaller, newer and less successful franchises drain franchisor resources.

“Due to less experience, lower skill level, and infancy in the business cycle newer and smaller businesses tend to usurp the majority of the franchisee focus: one-on-one support, set up and structural guidance, team training and marketing templates, ongoing check ins and follow up. Those needier entities - the  newer, smaller and lower performing franchisees - pay less, while taking more.” 

Coronis is a privately owned business with 35 years of success. Their agents earn three times the industry average. 

END
Read Carmel Kellett's full opinion piece here