Seal of approval

In our industry, the rates of attrition as clients retire and die or occasionally move to another adviser, makes it even more important that a considered new business or client acquisition strategy is in place.

The issues remain the same, be it for nationals or networks. To the outside world we need to be seen as professional, highly qualified and, in addition to the relevant product knowledge and technical ability, advisers must demonstrate a degree of business and commercial acumen.

That is the only way a financial planning firm can grow, keep ahead of the competition and attract new clientele as well as new blood on the staffing front.

Endorsement by professional introducers is particularly important for corporate clients

In our experience, establishing links with local professional introducers, namely accountants and solicitors, and, to a lesser extent HR practitioners and estate agents is very important.

IFAs need to stand shoulder to shoulder with their fellow professionals and that is why striving to attain chartered status is paramount.

As advisers, we need to show that we hold the highest professional qualifications. Indeed, attaining chartered firm status carries even more weight.

Endorsement by professional introducers is particularly important for corporate clients. Recommendations by existing private clients are also very effective ways to get new business. Be it dinner party or pub talk, a delighted client will sing the praises of his or her adviser.

Live client case studies resonate with those in need of advice and so when someone hears or reads in the weekend press about vexing IHT or retirement planning problems solved by a wise adviser, the telephone rings and the website is hit. But remember, the old adage of quality not quantity rings true.

Price is not everything and advisers must maintain the highest levels of service - the clients that are motivated by price alone are the ones you can do without. The ones to whom you have provided an excellent service are the ones that will bring you new business.

On the theme of quality, strong networks have extremely stringent compliance and control functions. Any investment recommended by an adviser has to be pre-approved. Networks cannot tolerate an adviser on a “folly of his own”.

So networks do sometimes turn business away. Niche areas are often worth looking at. For example, an adviser can specialise in advising divorcees and those going through family upheaval and establish a reputation which leads to the introduction of new clients from family solicitors and others involved in a given scenario.

Networks cannot tolerate an adviser on a “folly of his own”

Organising and hosting seminars for both private and corporate clients are useful for networking and for new business. And they need not be expensive to run.

They can cover a range of topics and it is a good idea to invite guest speakers including fund managers, tax and other technical experts who can explain fund performance, for example and be accountable to clients at the same time.

Such seminars work very well and encouraging clients to introduce friends and relatives, who may also be in need of financial advice presents the IFAs with an opportunity to showcase their wares to a “warm” audience.

Many advisers swear by local networking events and directories, social media, SEO and signing-up to the likes of Unbiased or Vouched For. Although the seasoned adviser may be baffled by the thought of someone seeking complex pension and tax planning advice on the back of a Facebook “like”, you would be surprised what comes through the door.

We all have anecdotes of how we first met our major clients, and it is true. An out-of-the-blue request for some mortgage advice might lead to a mandate to look after a large investment portfolio, or a company pension scheme. Curiously, the news that the high street banks are re-entering the advice market is good.

Some of member firms have attracted significant business on the recommendation of local branch managers with whom they have built up relationships. Then there are the challenger banks and others that have quietly carried on backing businesses that the high street lenders have abandoned during the credit crunch. They will have customers that they have supported that may very well need financial planning advice, however basic or sophisticated.

The days of commission driven salesmen are fortunately far behind us and the industry has come through RDR and other regulatory and economic seismic events relatively well. The constant tinkering with pensions law, retirement ages, tax and other legislative hurdles really has kept advisers on their toes and earning their corn.

In general, and barring the occasional fraud, which is no more or less prevalent amongst crooked accountants and solicitors, the image of today’s wealth manager type financial adviser is pretty good. The overtly sales-led era has given way to any even pastoral way of providing support and advice in an almost altruistic way.

Many advisers build up trust and friendships with their clients, often giving wise counsel on a whole range of vexing corporate or private family matters. Some are invited on to the boards of their corporate clients, while others are invited to family weddings or asked to become godparents.

These bonds are often inter-generational and, quite frankly provide advisers with a great deal of personal and professional satisfaction – and new clients in the form of children, grandchildren and other relatives of existing clients.

In the current climate of consolidation and acquisition, networks may well consider buying a business rather than relying on organic growth. Due diligence is the key, particularly when taking on a client bank of a retiring IFA, or when inviting a new firm to join your network.

There may be the odd blip in an adviser’s track record, as there could be Fos and other complaints lurking in the background, which due diligence will show up, but there will be explanations which must be heard and considered decision reached.

A well-managed, well thought out and well integrated acquisition strategy is the short cut to acquiring rather than attracting new clients. But the industry has seen many disastrous and ill-fated integrations, which have left advisers disillusioned and wanting to jump ship and, much worse, clients receiving a pretty shoddy service.

In conclusion, any network, usually to satisfy investor greed or shareholder impatience can trumpet an aggressive expansion plan stating that X number of advisers and £Ym funds under management will be achieved by the year dot, but in reality unless you can retain existing clients for the long term and attract new ones for all the right reasons, then there is no point in trawling the depths for numbers. In the end, common sense has to prevail.

Andrew Bennett is chief executive of Beaufort Financial Planning