FranNet, the Kentucky-based network of more than 100 franchise consultants, is celebrating its 25th year in business this year. FranNet invented the broker concept where consultants work individually with clients and use a specific profiling and consultative process to determine a business model unique to each person. Its services are free to prospective franchisees, and consultants are paid a commission by the franchisor for every new franchisee they bring into the system.

FranNet had a record year last year, and this year started off even stronger. FranNet placed 33 percent more clients into franchise ownership in the first three months of 2012 than in the same period in 2011. These impressive results bode well for the franchise industry in general. Based on FranNet’s data, it looks like actual franchise growth may exceed  the estimates of Global Insights for 14,000 new franchise units to open this year.

FranNet is about to release a comprehensive survey of placements and success rates — the first of its kind in the industry —  and the data is really compelling. Of the franchises FranNet helped open, over 92% are still in business after the first 2 years. The US Census reported in the late 1990s that only 64% of small businesses make it past the first two years. The results of FranNet’s survey indicate that franchises succeed at a 25% higher rate than most small businesses. I’ll share more of the data with you when FranNet is ready to release it.

FranNet has also done much better than other broker networks because its brokers are really local and work hard to meet people in person as they network. FranNet has aggressively reached out to business organizations and other referral partners for good franchisee candidates; among the more successful recent partnerships have been alliances with the small business counseling nonprofit SCORE and the business networking organization BNI.  They don’t really do internet leads and it shows in both the number and quality of placements.