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Be a stand-out risk adviser!

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Business planning Australia for financial services 

Call Gary direct on 0408 756 531

The majority of advisers are generalists because they tend to write the next person who says yes to an appointment, whoever that may be.  For this reason, risk advisers by and large look the same to the average customer.  Often the winning difference is persistence, professionalism, knowledge or trust.

It is tough to operate as a ‘me-too’.  It is even tougher being a ‘me-too’ trying to be all things to all people.  In a market where clients are becoming more educated and aware, few advisers have the comprehensive technical and product knowledge to do it all and do it well.

For a lot of advisers, the risk insurance appointments that aren’t referrals are the result of cold calling.  However, the anti-hawking provisions and the do-not-call telephone register now make it difficult to directly approach individual householders.  As a result, there has been a shift towards cold-calling business owners, mostly because they are still fair game.

The SME (small to medium enterprise) market segment has become increasingly popular but is still significantly underdone.   There is a tendency to separate the owner from his or her business and insure the individual only; thus ignoring the business itself.

The missed opportunity is not responding to the total needs of both owner and business as a combined unit.  This non-response is generally caused by a lack of knowledge, experience and confidence.  It also takes a little longer to get the job done and this is perceived as time better spent elsewhere.

It is for these reasons that the more complex business issues of equity protection, asset protection, key person protection, business succession and small business CGT rollover are overlooked.

It is the distracted effort to maintain a consistent flow of new business and monthly income that results in the more specific and more valuable market segments being missed by advisers.

Advisers who do specialise do it either by industry or and / or by product.  Over time, they emerge as very successful because they have deep knowledge in a narrow area.  As a result, they become known in an industry and are referred to more often.

Financial services business planning you can trust 

Call Gary direct on0408 756 531 or email gary@garyweigh.com

Risk advisers have every reason to plan

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Business planning consultancy Brisbane

Call Gary direct on 0408 756 531

In my last blog post I talked about the true value of risk insurance and the client-focused risk adviser.  However, this praise does not take away from the fact that the risk insurance advice business currently works on a slightly flawed business model.

The flaw is that the commission system has the potential to provide the adviser with a good income even if they don’t provide a good service.   As I have said previously, being paid by the product provider attaches the adviser to the product and a ‘client register’ but does not necessarily attach the adviser to the client over the long term. 

This creates cross subsidies among clients.  This means while all products pay the same, the adviser receives different levels of income depending on factors such as age and health risk.  Consequently, not all clients receive equal service from their adviser.

Healthy young people with low sums insured don’t produce much ongoing commission income and it would be difficult for an adviser to provide service if the same amount was received as a fee. 

It is the older unhealthy smokers with high sums insured that subsidise the service provided to the rest of the client portfolio.

The flip side of this is that the healthy young clients are the long term clients and the future of the advisory business.  The older unhealthy clients are currently profitable but are not long term prospects.

For this reason, every risk adviser and risk advisory business would benefit from some professional advice at my business planning consultancy in Brisbane. 

However, the cross subsidy issue is not the only reason to plan.  Business planning addresses a wide range of other issues as well. 

These include:

  • Building a business as opposed to building a ‘client register’
  • Distinguishing yourself from the legion of ‘look-alikes’ in the market place
  • Presenting yourself as others see you, not as you see yourself
  • Targeting particular groups of customers with specialist services
  • Developing hybrid (fee + commission) based packages
  • Devising and implementing long term client retention strategies
  • Building a valuable rollover or retirement asset for the future

For some advisers with large amorphous client bases, this may necessitate re-focusing and decreasing the client base over time rather than growing it.

#1 Business planning consultancy in Brisbane

Financial services advice you can trust !

Call Gary direct on 0408 756 531 or email gary@garyweigh.com

The true value of the specialist risk adviser

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For business planning Australia call Gary direct on 0408 756 531

Under the FoFA proposals to ban conflicted remuneration (i.e. product commissions) the specialist risk insurance adviser is looking as though it might emerge unscathed.

While financial planners appear to be headed for an ever deepening mire of ‘nanny-state’ paperwork, added to which will be the administrative task of generating and mailing invoices and / or opt-in renewal notices, it appears as if risk advisers might be left to get on with the job of advising.

With no requirement for holistic plans, doorstop sized SoAs, invoicing and debtors systems, it appears as if the solo risk adviser might continue to operate as they always have.

Yes it is true that the risk insurance commission system doesn’t always reflect the true value of risk advice over time but it does help ensure that at least the client focused adviser will there for the client in the event of a claim.  The proposed opt-in provisions are unlikely to achieve that.

On the plus side, it will certainly be a big help to solo risk advisers to have the life companies and licensees continue to shoulder some of the administrative burden by of commission remuneration.

On the minus side, the commission system has the potential to provide the adviser with a good income regardless of whether they provide a good service or not.   Being paid by the product provider attaches the adviser to the product but does not necessarily attach the adviser to the client over the long term.

Without risk advisers, Australians would be further underinsured and that increased financial burden will eventually transfer to the government welfare system.

The majority of Australians already dismiss the concept of risk insurance as a waste of premiums because they wrongly believe that “it won’t happen to me”.  It is only the life company claims people, medicos and risk advisers who know the reality and see the end result of human fragility.

It is not until you have delivered a cheque to a family torn by tragedy, and seen the expression of relief and gratitude, that you can ever understand the true value of risk insurance and the true value of the client-focused risk adviser.

#1 business planning in Australia

Financial services advice you can trust!

Call Gary direct on0408 756 531 or email gary@garyweigh.com

Business planning Australia – a challenge is looming for financial advisers!

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Business planning Australia 

Call Gary direct on 0408 756 531

A lot of self employed financial planners are going to have their world turned upside down next year when ongoing commissions will cease as a way of paying for financial advice.

Many financial advisers will have to change the way that they charge for their services.  But that is only the start of it.  The knock-on effects of this change are much more far reaching in terms of business survival.  In financial services business planning Australia will lead the way.

There are many advisers whose entire monthly income is made up of investment and insurance commissions relating to business written in the past.   They will be shaken up the most.  A lack of business planning and management skills will see a lot of advisers leave the industry.

Although it is irrelevant now, some clients love the commission based income system and others hate it.  The problem with this model of pricing financial advice is that it doesn’t relate to the present.  It relates to past business written.   

From the adviser’s point of view, that’s not such a bad thing because it is always a desirable business goal to establish recurring income streams.  In other words, it allows income earning while you sleep.

From the client’s point of view however, one of the disadvantages is that there is no incentive to provide service today.  The adviser only has to do enough so that the client doesn’t change his or her servicing adviser.  So in many cases, a minimum service is provided and the adviser gets paid, no matter what.

With the upcoming change, every adviser will have to provide maximum service (not minimum service) to compete.   It is often said that the price of financial advice will skyrocket as a result of this change, but I don’t think so.  It is more likely that competition will keep fees at a reasonable level.

The changes required to each and every financial adviser’s business will go much further than a mere switch to charging fees.   It will involve a complete restructure of their businesses.  To many, it will feel like starting all over again.

Those who commence business planning now will be well placed when the change comes into effect on 1 July 2012.

#1 Business planning Australia

Call on 0408 756 531 or email gary@garyweigh.com

Business planning – Train your reps in business development!

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For quality business training call Gary direct 0408 756 531

Business development is a lot more than increasing your sales strike rate.  It is about helping your sales people and / or your self employed reps to build a long term business – theirs and yours!

Include it as part of your annual business planning!

If you can train your reps to look beyond the next sale, towards building a long term asset for themselves (and in turn for you) they will be on a winner and so will you!

Your licensees might be:

  • Financial planning authorised reps
  • Insurance authorised reps
  • Credit & lending authorised reps
  • Commission based real estate agents
  • New franchisees
  • Commission based product sellers.

Even if you have employed sales reps, it can only help your business growth to apply sensible business principles to their activities.

One way or another, business development training is a valuable long term investment in your own business.

Train your reps individually, in group sessions or at your next conference!

Call or email now! 0408 756 531 gary@garyweigh.com

Gary

YOU NEED TO READ THIS!

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You have come to a crossroad! 

It's time to act!

FOR BUSINESS PLANNING AUSTRALIA CALL GARY DIRECT 0408 756 531

You are sick of being someone else’s lackey and pursuing someone else’s dream.

You wish for change in your life!

It seems that everyone around you has more money, a bigger house, a nicer car and a better relationship.

Your job sucks!

You are tired of the daily commute and the weekly drudgery of work.  You only do it to pay the bills, but there is never enough time for yourself. 

You feel like you are on a treadmill and that you will never get ahead in life!

The boss expects perfection 24/7 but is far from perfect himself!  You bust your hump with honest, loyal service.  But you know it means nothing on corporate judgment day!

You want another shot at life!

This time you know what you want.  You see what others have!   A good life!

The desire for change has been growing inside.  You are frustrated and dissatisfied!

You know you can do better and you know deep down you can make it!

You just need a chance to realise your potential!

If dummies can do it, then you can do it in half the time!

Why? Because you have stood by and watched so many dummies around you become wealthy, buy nice things and have a lifestyle of pleasure!

So why is it difficult to change?

Because you are comfortable in your routine!  You hate it but it is a comfort zone.  You know that your daily routine of long hours, stress on the road, stress in the office, little leisure time, is all to build someone else’s dream, but you can’t quite crack the inertia.

You are a little fearful that if you go out on a limb, the branch will break and you will fall.  You fear something will go wrong and you will be worse off!

Relax!  You need someone to watch over you!

I have done it and it’s not that hard.  All it takes is self belief and a can-do attitude.

If you take a little time to plan, the risk is quite low. 

Let me assure you that your fear and self doubt is all in your head.

Do something for yourself! 

Write to me (gary@garyweigh.com) and tell me the following!

  • 3 things you most hate about your life

  • Your 3 greatest passions

  • The barriers you believe are stopping you from moving up in life

EMAIL NOW gary@garyweigh.com

I will respond to every email personally.  I will show you how to take your first business planning steps towards financial independence!

Business planning – a template is only half the story!

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FOR BUSINESS PLANNING CALL GARY DIRECT ON 0408 756 531

Most business plans simply follow a template that ensures all the boxes are ticked and every aspect of the new venture has been addressed, e.g. structure, people, product, manufacture, marketing, etc.

However, the business planning template alone fails to match the person to the business; it fails to develop and grow the owner into the business; and it fails to show a person how to grow the business into a valuable asset.

You can have the best business plan in the world but still be at a complete loss to know how to successfully operate a business.  People who are new to business must consider more than just the words on the pages of a business plan. 

Here is what people really struggle with in business planning:

1.      Being in the right business head space

Some people have a mind for business and others don’t.  Coming from an employee background into business is a big leap because there is more to business than showing up for work each day and doing routine tasks.  It is important to approach business with an attitude of self belief and self reliance, with a willingness to do whatever it takes.  For most people, it means loneliness, difficult decisions, and being stretched a long way out of their comfort zone.

2.      Having sufficient business skills

The most common profile of the new business starter is someone who is skilled in a trade, a profession or other personal service and decides to become self employed.  The other common profile is the person who has a skill in making something.  What they all have in common is the technical skills to perform a service or make a product.  Many have no selling skills and most lack the wide range of other skills (including financial management) required to grow their business and build a valuable long term asset.

3.      How to take the first step

You only have to visit the ‘Starting a Business’ forum on Flying Solo to see the inordinate number of questions people ask about getting an ABN, registering a business name, being a sole trader, setting up a company, trademarks, registering for GST, employing a person on PAYG, and getting a website.   For many it is a struggle just to get through that part; and the real business hasn’t even begun yet.

4.      How to be action-oriented

A lot of people struggle when the theorising stops and decisive action is required.  As an owner, ‘action’ usually means contacting people, forming relationships and performing those tasks that directly relate to building sales and profit.  Initial enthusiasm can quickly turn to disheartenment after a few knock-backs or when thing don’t go as planned.  It can be a difficult challenge to keep moving forward under pressure of dwindling cash flow.

For more reading on business planning check out my Business Planning 101 Introduction at  http://garyweigh.com/business-planning-101-introduction.html

Until next time!

Gary

gary@garyweigh.com

Business planning – buying a business with no financials available!!

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FOR BUSINESS PLANNING AUSTRALIA CALL GARY DIRECT ON 0408 756 531

If as a result of my business planning I was buying a business from someone who insisted that their business was a good buy but refused to hand over any financial statements or supporting information, I would run a mile.

It is always hard to know the reason for the reluctance but experience suggests it is either a rubbish business or else it could be this!  

It is easy for owners in cash-based businesses to take cash from the cash register and never bank it or record it.  Many owners confuse the concepts of revenue and profit.  They believe that all money that is generated from sales is theirs.

Uhmm … no … big mistake!

There is that small matter of paying suppliers and all business overheads.  What is then left over is available to be drawn by the owner and pocketed.

‘Living out of the cash register’ is a dangerous practice for the following reasons: 

  • It leads to cash flow problems because creditors can remain unpaid as a result of short-banked revenue
  • If the pocketed cash is not accounted for as sales revenue and then as owner’s wages / drawings, there is going to be some false statements made on a tax return.  Not declaring income taxable amounts to tax fraud.  This will bring the ATO down on the owners head like a ton of bricks.
  • When it comes to selling the business, the true value of the business can’t be substantiated because part of the sales revenue was pocketed instead of banked.  If a subsequent ‘bank reconciliation’ is to balance then the temptation arises not to record the sales either.  However, the cost of sales must still be paid and harder to hide.  Therefore the business looks like it has low sales, low margins and low profit- and its value becomes diminished. 
  • The practice often leads to keeping a two sets of books – one for the tax office (ATO) and one for a prospective buyer
  • If the business owes money to a bank manager or if a loan is being applied for, it is common that the bank wants to see regular financial statements (often monthly).  Problems will arise if the bank can’t reconcile true sales figures with actual short-banked receipts (which the bank can plainly see).  Lying to the bank can also have dire consequences including loan refusal or a demand for full and immediate repayment of an existing loan.
  • Even if two sets of books are secretly kept for a long period of time without discovery, there will come a day when the secret has to be revealed to a prospective buyer. 

So who wants to admit fraud to a perfect stranger?  It is easier to refuse to hand over the financials.  If you encounter this – walk away!   It is odds on that the owner is living out of the cash register and keeping two sets of books.

For more on business planning check out Famous Failures of the Most Successful People In The World at http://garyweigh.com/starting-up-your-own-business.html

Until next time!

Gary

gary@garyweigh.com

Business planning – Think before you leap!

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Gary Weigh

FOR BUSINESS PLANNING AUSTRALIA CALL GARY ON 0408 756 531

If you are business planning a great idea that you think will make you money; or if you simply want to turn your passion or vocation into a business, stop and think before you leap.

The world is a constantly changing place and there are a few boxes to tick when you are planning a new business venture.  Here are 9 business planning must-haves to think about:

ONLINE!

No business will be able to survive in the future without an interactive online presence.

WOW FACTOR!

People (not computers) are gifted with creativity and insight; be an innovator not a ‘me-too’

GLOBAL!

The world market is only a click away, and so are the related international challenges to address.

INSTANT!

Time is the consumer’s scarcest resource, making convenience always in high demand.  Consumers won’t wait for you or abide by your inflexible structure.  They want products and services now.  Baby boomers were taught to wait but even they are changing their attitudes.

FREE!

The internet business community is developing as a “cheap or free” economy.  So you will have to be innovative in the way you generate revenue.

COLLABORATION!

New concepts are evolved by combining ideas; by building upon what’s gone before.  Similarly, concepts are implemented by sharing resources (i.e. human, intellectual and technological capital).

SOCIAL!

Instant communication, online social networking, information sharing and fan-base dynamics will play an ever increasing role in making and breaking businesses.

DIFFERENCES!

Businesses survive and grow on their differences, not their sameness.  Also look past your operating difference and your bottom line to making a social difference and an environmental difference.

CONNECTIVITY!

You are not a disconnected being; you are a descendant of about 300,000 years of human life, and a couple of billion years of evolving life form before that.  You are the latest product of the environment and the universe.  So make the most of your shelf life; be open to making positive connections with everything and everyone around you.  Don’t resist and do your best not to get in the way of natural connectivity.

For more on business planning in australia, check out First Rule of Planning at http://garyweigh.com/the-first-rule-of-planning.html

Until next time!

Gary

Don’t put your family at risk.  Your business is your future; your retirement; your jewel in the crown.  Protect it!

Learn how to build a powerful presence.  Visit my Aikido Secrets blog site

Your 1-page action plan

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Business planning in Australia should be a straight forward and practical exercise.  Although you need to aware of many potential traps, there is no reason why you can’t write down the heart and soul of your business plan on one sheet of paper.

Preparing a business plan is basically deciding ‘what’ you are going to do and ‘how’ you are going to do it.

One of the main problems with business planning is that new starters follow other people’s templates.  They focus on rigidly following the format of the template.  This means filling in text and diagram boxes.  There is no light and shade and no emphasis on the critical stuff.

Instead of producing a 300-page document that is so detailed that you’ll never read it, distil the important parts down onto a 1-page action plan.

The important stuff is this:

  1. The ‘what’ – your main goals
  2. The ‘how’ – your main strategy
  3. The ‘payoff’ – the all important results

Now let’s look at each in a little more detail.

1. Start with your main goals

The most important feature of your plan is your goal setting.  Although dreaming up a few goals sounds easy, this is the part of business planning that most people struggle with.

I will show you in my next post how to go about setting goals.  In the end, regardless of what others say, your goals are yours.  You must live your truth in business and your goals must reflect that.

2. Be clear on your main strategy

In order to be clear on the ‘how’ of achieving your desired results you must have a good understanding of your customers and their demand.  For example, why will they buy?  What problem are you solving?  Why buy from you instead of any one of fifty other look-a-likes?

Make sure this ‘how’ part of your plan is ALL ACTION.  Any procrastination in executing strategy is deadly.  I recommend that you decide this!  “Out of all the actions I could be doing, which ones will give the highest payoff (i.e. better results sooner)?”  Do those actions!

Business cards, brochures and static websites are tools, not strategies and in isolation, won’t work.  Customers won’t go out of their way to seek you out.  You must act to go find them, and to put your message in front of them, clearly and simply.

3. Finish with the pay-off

The pay-off is what keeps you in business!  So it is important to monitor it.

You must have a measurement system to know if the pay-off is actually achieving your goals within your desired time frame.  However, what you specifically track and measure depends entirely on the type of business you have.

Some people track calls and sales appointments; others track weekly sales and gross profit.  Some people track units produced and fault rates; others track online click rates.  Many old-timers still track cash at bank – the only figure that they trust.

Your one-page action plan

The beauty of a one-page action plan is that you can carry a copy with you, pin a copy on the wall in front of your desk, circulate it easily to employees and outsourcers or fax a copy with your monthly results to your business banking consultant.

Until next time!

Gary