Scaled advice opportunities

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Business consultancy Australia

Are you an adviser facing the Future of Financial Advice with uncertainty? 

Call Gary direct on 0408 756 531 for trusted advice.

Scaled advice means providing piece-by-piece simple advice rather than a complete financial plan.  It is advice about one area of a client’s needs, such as insurance, or about a limited range of issues. This contrasts to so-called “holistic advice” which is the traditional advice model offered by many financial advisers.

The Government’s move towards scaled advice will open up the financial advice market beyond financial planners to e.g. superannuation trustees and accountants.  It is still a matter of consultation how far superannuation trustee advice will be permitted to go.

The Government indicates that it will amend the existing ‘reasonable basis for advice’ obligation in the Corporations Act to make it clear that this obligation is commensurate and scalable to the client’s needs when providing advice.

This change heralds some new opportunities for financial planners.  A few of these include:

  • The opportunity to present a fixed fee menu of simple services
  • The chance to specialise in particular areas
  • The opportunity for regular client contact
  • The chance to network around a client’s family doing ‘simple’ or ‘specialist’ tasks
  • The opportunity to focus on targeted clients with the ‘particular need’

Whilst the concept of limited advice is not new, the fact that the Government is codifying scaleable advice indicates the market need for more easily accessible and advice that addresses specic needs and is easier to understand. 

The challenge for advisers will be to set out the blueprint for the future and to manage the change from the current mode of operation.  It will involve some astute business planning; in particular, an overhaul of the product offering, and pricing the new services appropriately.

Your trusted financial services business consultancy  in Australia

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

Charging for financial advice after 1 July 2012

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Are you an adviser facing the Future of Financial Advice with uncertainty? 

Call Gary direct on 0408 756 531 for trusted advice

Be smart! Get coached!

The FOFA remuneration reforms are designed to separate advice fees from product fees.  Financial planning clients will pay product providers for their products and will pay advisers for advice.  The controversial ‘conflicted remuneration’ (i.e. of upfront & trailing commissions) that has existed between product provider and adviser is to be eliminated.  The client, not the product provider, will be in the driver’s seat when it comes to remunerating advisers.

So in the absence of upfront and trailing commissions on investments and superannuation products from 1 July 2012 (and ‘insurance in super’ commissions from 1 July 2013), what will be the available pricing and payment options for advisers?

There will be no shortage of options but many advisers are going to have to adjust to a new system of remuneration.  Although the changes are likely to be prospective, many advisers currently reliant on commissions will have to re-think their value proposition.  Let’s look at the options:

Pricing options

  • Hourly rate
  • Flat fee per service provided
  • Fixed annual fee (a retainer)
  • Performance or outcome based fees
  • Ongoing advice fees – (a) fixed or (b) asset based on un-geared investments only (renewable by ‘client opt-in’ every 2 years)

Payment Options

  • ‘Once only’ paid up front or when work is complete
  • Regular invoice (e.g. monthly or quarterly)
  • Paid through adviser payment plan (e.g. Ezi Debit)
  • Deducted from the client’s investment funds at the direction of the client

Payment Types

  • Cash
  • Cheque
  • Direct credit to adviser bank account
  • Direct debit (e.g. Ezi Debit)
  • Pay Pal

Where a ‘licensee / authorised representative’ relationship exists, the licensee is the responsible entity and must be paid.  Some payments will come from product providers in the form of client- authorised deductions, but a significant portion will come from clients directly in the form of fees.  It is likely that all fees remittances will be paid or deposited directly in favour of the licensee (i.e. to their bank account or payment plan), who will in turn pay each adviser.

Your trusted financial services business consultancy Australia.

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

Build a financial services business worth paying for!

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Business coaching Brisbane 

Call Gary direct on 0408 756 531 for trusted advice.

My business coaching Brisbane practice is already one of the fastest growing businesses in Australia.   That is because many financial planners and financial service providers are having a good hard look at their businesses in the near future.  Here’s why!

Most financial planners offer a combination of the following financial products:

  • Superannuation
  • Managed funds
  • Shares & other securities
  • Risk insurance (income protection, life, trauma, disability)

To date, many financial planners are not paid by the client.  Instead they have been paid by the providers of financial products.  That is about to change!

From 1 July 2012, financial planners will be paid by the client.   If they are to be paid by the financial product providers, it will be only for a year maximum, not forever.

Being paid by the client instead of a product provider is not merely a change to charging fees.  It is a fundamental change in the way an adviser conducts his or her business.  For many, there will have to be a service worth paying for.

The first decision a financial planner has to make is which business he or she is in, and who is the client.  For many, providing advice is going to be difficult because their knowledge has been skewed towards justifying and selling products.

Making money out of advice is a whole new ball game and it won’t be easy for a lot of long standing advisers.  It will also be difficult for newcomers because it takes a long time to gain the level of knowledge required to be a quality adviser.

Looking for a trusted financial services business consultancy? 

Call Gary direct on 0408 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

Don’t let health misfortune wreck you financially!

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Business planning consultancy Brisbane

For quality protection solutions call Gary direct 0408 756 531

Welcome to our business planning consultancy brisbane!  You’re a business planning business owner!  You work very hard every day to build a better life for you and your family.  You want your kids to have the best possible start to their adult life.

But what if something happened to you? What if you were no longer around? What if you were still around, but could never work again?

What would happen to that better life you envisaged for your family?  Most small businesses are dependent on the health of the owner.

Insurance is the best way to protect against losing everything you’ve worked for. Life insurance, along with permanent disablement and critical illness insurance can help to ensure that your family is taken care of if you can’t take care of them yourself.

Include protection in your business planning.

Call my business planning consultancy in Brisbane on 0408 756 531 

or email now at gary@garyweigh.com

Gary

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

Businesses don’t compete, customers do!

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FOR BUSINESS BUILDING ADVICE YOU CAN TRUST CALL 0408 756 531

Whether people realise it or not, everyone competes!  It is just part of life.

As children we compete with siblings for toys and often for the affection of parents.  As adults we compete in sport; we compete in school and we compete at work.

In third world countries people compete for food shelter and basic medical attention.  Tragically, it is all too often the case that people compete for survival itself – the chance to stay alive!

In more fortunate societies where the basics of survival are taken for granted, we compete to be as good as the next person.  We compete to keep up with the Jones’s.  We compete for approval, promotion, and recognition.

Money is merely the lubricant that oils the social gears!

In our endless quest to rise to top of the social heap, or at least to get off the bottom of it, we compete in the social hierarchy.   Often we are not competing with anyone in particular.  We are mostly jockeying for position.

When we leave the parent’s nest, we compete because there is expectation to do well.  Parents and spouse expect it.  They expect that the basics of a reasonable Western lifestyle will be taken care of.  That means competing for a good job to earn money to buy lifestyle assets.

At the minimum, people want to look the same, be the same, have the same, and provide the same chance to their offspring as everyone else.  If one is to stand out from the crowd, it’s the norm that it should be for being smart, rich or successful.  It shouldn’t be for embracing abject poverty and failure!

Nevertheless, if it comes down to a ‘them or us’ choice, most will take the opportunity to climb upwards at the expense of someone else slipping down – every time!

It is this human competition in everyday life that generates business sales!  As I have said before, when it comes to competition in business, it’s the customers who compete to buy.  It’s the smart traders who allow them to do so.

Smart traders who understand business building also understand the human buying process and the underlying emotions that drive it.  They simply signpost the path to buying and remove every obstacle and roadblock along the way.

For more reading on business building check out the Paradox of Money on my Aikido Secrets site.

Until next time!

Gary

gary@garyweigh.com

Business building – drill deeper into the buying decision

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FOR BUSINESS BUILDING CALL GARY ON 0408 756 531

If you are thinking about business building, try thinking about your business as a club and think ways to increase its membership.  Consider the attributes that a club might have, other than its main activity.  For example:

  1. An identifying style of dress
  2. A jargon of its own
  3. A unique set of rituals
  4. Similar morals and values
  5. It’s own internal means of communication
  6. Similar ideas outside the 4 walls of the club
  7. A social aspect

It is essential to realise that the reasons for membership of a club are wide and varied, and the reason is not always the long held love of the specific activity in common.

For example, people do not always join a martial arts club because they are hankering to learn the specific art on offer.  They may join because they have been bullied; they want to be able to defend themselves; they want to lose their fear and feel confident; they seek to meet fit and healthy people; they seek a lifestyle regime of self discipline and self respect, or perhaps they seek a non-religious spiritual path.

People don’t always join a tennis club because they have a burning desire to play tennis.  The reasons include learning or improving a skill, getting out of the house, socialising, meeting new people, health and fitness.  The game itself might be quite a secondary issue.

The same applies to your particular products and services.  You can bet people are satisfying a much deeper need when they come to you.  It is not as superficial as having a burning desire for your particular product offering.

For example, what people are really buying when they sign up for a life insurance policy is peace of mind!   Always aware that the premiums ultimately buy nothing if there is no premature death and no claim, it is therefore a tradeoff against ongoing financial protection of loved ones.  The emotion involved in the buying decision is fear … that is, fear of loss.

More on business building next time!

Gary

gary@garyweigh.com

Business building – add a club to your business

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FOR BUSINESS BUILDING CALL GARY DIRECT ON 0408 756 531

Business building is no different to starting a club.  After all, a club is nothing a group of people who come together to enjoy a common interest.  It is not very different from a group of customers who like all like your product or service.

Increasing membership is the name of the game.  However, members don’t necessarily have to be customers in the first instance.  Although a sale is the desired outcome, people still like to poke around a bit before becoming customers.

The noticeable difference between a business and a club is that members don’t all turn up to your clubhouse every Tuesday night to enjoy the common interest.  But they could!  If you let them do so.

Think about these seven (7) business combinations:

  • A financial planner who holds a free educational seminar (or uploads an online podcast) for existing clients each month or each quarter
  • A home interior decorator or renovator who provides customer online access to a 360-virtual tour of an exclusive ‘house of the month’
  • A restaurant that provides customers with a weekly online ‘sneak peak in the kitchen’ and simple home recipes
  • A real estate agent who sends his or her investor customers the details of the latest property listings that fall inside each investor’s stated criteria
  • A nursery that uploads seasonal instructional videos about how, when and where to position and maintain the plants that they sell
  • A business coach who writes an original and instructional blog and uploads it as a free educational resource for both existing and potential business owners
  • A natural therapist who provides history and benefits about their products and services as well as education about the natural treatment of other health conditions

If you run your business like a club, people will go where they are invited if they are made to feel special.  So no longer will your customers simply try your offering and leave, they can now stick around as a member of your club, so long as you continue to deliver and hold their interest.

Building a club around your business also gives you ample opportunity to up-sell other products.  There is nothing like a little free education and a few more reasons for customers to buy some of your other products and services.

Until next time!

Gary

gary@garyweigh.com

Want to read more? Check out my article Online business building at http://garyweigh.com/online-business-building-%e2%80%93-limitless-potential.html

Business building by telling stories

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FOR BUSINESS BUILDING CALL GARY DIRECT ON 0408 756 531

According to Howard Bloom, author of The Lucifer Principle, the success of memes and those who propagate them is due in part to their clever use of the invisible world.  This is the world of story, legend and belief.   He refers to the invisible world that plays on our desires and fears.  Business building is no different!

Broadly speaking, the aim of marketing is to satisfy a need, allay a fear, or create a desire.  Here is an example of each:

  • Buying food to have a full stomach is satisfying the basic human need of hunger
  • Installing a home security system is allaying the fear of loss of safety and / or possessions
  • Joining a weight loss service is the result of creating the desire to look and feel good

Marketers know that all of these products and services are all best sold by use of stories.  People love stories.  Most of us have been ‘message conditioned’ by stories ever since we were small children.  People remember stories.  People repeat stories.  The take-home marketing message is in the story.

Three (3) everyday examples found recently on Australian TV are:

  1. A large supermarket chain tells the story of the ‘fruit & vegie’ manager visiting the farms to hand pick the freshest food for their stores.  By doing so, they enhance the value part of the ‘value for money’ proposition and avoid having to reduce the price.
  2. A home security supplier tells a story of thieves breaking into houses by kicking in the security screen door.  It creates fear and then proceeds with the story to allay that fear by offering their particular security door solution.
  3. A weight loss service provider tells story of an overweight celebrity who has used their products to achieve his or her dream of looking good and feeling good, with all the accompanying health and lifestyle benefits.  It is an autobiographical testimonial style story with ‘before’ and ‘after’ images as supporting evidence.

In all cases, it is very clever story telling.  Stories convey messages so much better than simply listing benefits.  Why?  Because no one is interested in what is logical!  Logic alone sells very little.  Marketers know that they have to drill down further than that and tap into feelings and emotions. 

For instance, the weight loss service provider knows that presenting the logical health benefits alone would sway no one.  However, if they appeal to vanity and desire first and then justify it later with the obvious health benefits, customers will come in droves. 

So logic does have a place.  It is second place!  Logic is used by a customer after the fact to justify and support emotional buying decisions.  But logic alone just doesn’t cut it.  For the initial grab, emotion outsells logic every time.

for more on business building read Dream Income Stream at http://garyweigh.com/business-building-%e2%80%93-a-dream-income-stream.html

Until next time!

Gary

gary@garyweigh.com