Speaking on the effects the RDR had on advisers, Shaun Thomson of Sandler Training claimed intermediaries needed to adapt to survive but should not forget the value of financial advice and undersell themselves.
He added that cost cutting sent out the wrong message and was not necessary because plenty of work had remained for quality advisers.
Mr Thomson said: “Do not be drawn into cost cutting or free advice, as this is a one-way track to failure. It comes across as if you do not value your service and how can a customer be persuaded to trust you if you do not trust yourself.
“Clients do not want the cheapest; they want the best. If you start a process of free consulting then you start a vicious cycle that will only get worse. The fee structure needs to be addressed immediately with confidence, rather than apologetically.”
According to Mr Thomson, reassuring clients of your ability to manage their needs was the best way to eliminate any potential doubt about paying upfront fees.
He said this meant offering a unique, personal approach to each client, which would in turn create long-term productive relationships and the possibility of business referrals.
He added: “To maintain or win clients, they must feel you are genuinely interested in them and the reasons why they need advice. Do not talk products and services until you understand exactly what they need. Keep it relevant.”
Mr Thomson also addressed the growing evidence that many people can no longer afford advice. He said that although this was potentially a problem, the numbers had been balanced out by an “exodus of advisers” since the introduction of the RDR.
But while there still may be enough clients to go round, he warned advisers that in the new fee-based model trust had become an even more important ingredient to long-term success.
He added: “To grow and thrive with these changes, the industry must start to learn the art of establishing trust, which is the most important part of any sales process and goes hand in hand with this new environment.”
Paul Richardson, managing director for Surrey-based Concept Financial Planning, said: “I agree completely with what Mr Thomson said. It is all based on value and if you bring in negotiations it makes the profession less professional. If you have got no proposition, the client will see through it, whereas if you have a real proposition – a proper financial plan – I do not see why the cost should be negotiated. If the client does not see the value, it is best to move on. We are trying to build trusting relationships and if you take on a new client you have to both believe in the value of service offered.”