How is the amount of the Referral Fee determined between Engel & Volkers franchisees?
Engel_Volkers Franchise · 2025 FDDAnswer from 2025 FDD Document
- 14.10 Referral Fees: When permissible by law, Franchisee shall pay a referral fee to any other ENGEL & VÖLKERS System franchisee from whom Franchisee received a referral which resulted in a successful closing ("Referral Fee"). The amount of the Referral Fee shall be negotiated by Franchisee and the referring franchisee, as permitted by applicable laws, rules and regulations.
Source: Item 22 — CONTRACTS (FDD page 88)
What This Means (2025 FDD)
According to Engel & Volkers' 2025 Franchise Disclosure Document, the amount of the referral fee is determined through negotiation between the Engel & Volkers franchisee who is paying the fee and the Engel & Volkers franchisee who provided the referral. This negotiation must also comply with all applicable laws, rules, and regulations.
This means that there is no set amount or percentage dictated by Engel & Volkers for referral fees. Instead, franchisees have the flexibility to agree on a fee that is mutually acceptable. This could depend on factors such as the value of the transaction, the effort involved in the referral, and the customary referral fees in the local market.
It is important for prospective Engel & Volkers franchisees to understand that referral fees are permissible by law. Franchisees should familiarize themselves with any relevant regulations in their area to ensure compliance when negotiating and paying referral fees. This also highlights the importance of networking and building relationships with other Engel & Volkers franchisees, as successful referrals can contribute to revenue.