Financial advice practitioners looking to expand their services or client base have seven sources of new business already available to them and can likely predict the income they would gain from those areas, a practice management consultant has claimed.
Upward Spiral Professionals founder Martin Bissett and Australian regional partner Darren Xerri said the seven sources were current and former clients, current and former prospects, centres of influence, wish-list clients and unprogressed inquiries, and they could be accessed immediately.
“Current clients have already bought from us and have a relationship, but it would be wrong to suggest they are aware of everything you can do for them,” Bissett said, adding advisers and accountants could name at least one to two clients they could offer more services to and what price those services would cost.
He said the same approach could be used with former clients who had gone elsewhere for issues of cost, as well as with former prospects who either did not engage because of cost issues or a lack of follow-up.
Xerri noted most practitioners had current prospects in the wake of COVID-19 who were seeking better service from a new provider and these people were ready to engage, and being aware of what it would take should be noted by advisers and accountants.
He extended this to include centres of influence, such as other financial services providers, with practitioners being able to quantify the volume of work received and its value, but said centres of influence went outside referral services.
“Think about where you live and who are the growth businesses in your town, who writes the business column in the local paper or heads the chamber of commerce? These people know growth and ambitious people in your area and deal with them on a regular basis,” he said.
“Identify who you want to know and how they can understand what you do as they can open doors for you,” he said, adding practitioners should also “look big” using a wish list of ideal clients they would like to act for and what unique services they can provide.
Bissett said advice practices were faced with a choice to continue being a service provider or knowledge provider to their clients, and technology would place further price pressures on advice practitioners.
“The efforts of a services firm are based on revenue and a knowledge firm is based upon profit and there are steps to take to move from one to the other, but be aware that market pressures will catch up with practices as technology companies increasingly take the bottom-end compliance away from our bread-and-butter practices,” he said.
“The case for having this kind of pipeline is that it ensures your best clients against competitive attack because you are developing new ways to help them and ensures your practice against losing the biggest clients because you are constantly being shown where new business is coming from.”
“If practitioners do this you should have a list of names of people you know or have spoken to, some are clients or ex-clients, but they are not ‘pie in the sky’ people but people you can help and they have money to give to you.”
