How to increase revenue in this climate

We all saw our income drop with the markets and have probably been stunned by how quickly everything turned around. At my branch, our income is directly tied to the value of the assets we manage. With the goal of increasing revenue, here are some of the ways we improved our bottom line.

1. We manage everything, including the cash.

Because we do comprehensive financial plans, we manage almost 100% share of clients’ investment wallet, but one missing piece was the cash assets. We started a reminder campaign to clients who hold existing high-yield bank accounts. We reminded clients that we could be the agent on record and showed them the current rate offerings of both our banking partners. Remember, advisors are paid 0.25% on these accounts. It may not seem like a big payout but if you can build your cash balances up to, say, $5 million, it will really start to add up, with monthly trailers of almost $1,000. Over the six weeks following our campaign, our assets at these firms grew by almost $1 million. Some of the assets were already at these firms but we were not the agent of record. We had the client sign the appropriate forms and voila — instant increase in revenue. As well, many clients transferred balances from low-paying bank accounts.

2. We “refresh” client financial plans.

During our semi-annual reviews, we used our Client Dashboard™, which shows clients where they are on track and off track. Anything in green meant they were on track and anything in red meant they were behind plan. Essentially, we would go over the key areas that clients had identified as a goal in their financial plans and re-highlight any pieces that were yet to be complete or were behind schedule. So, for example, the client who is now “in the red” for his retirement goal needs to increase his monthly retirement savings by $x to continue to meet the retirement age goal we had set when we created his financial plan. This also allowed us the opportunity to refocus on certain areas that were not implemented at the time the plan was developed. So prior to our reviews, we would produce a new illustration of the insurance coverage that we identified clients needed in their plan. We presented it again to our clients, advising that this was still outstanding from the list of “to do’s” and was in need of attention. Our critical illness, long-term care and disability coverage has grown by about 20% since we began this process.

3. We use the web and our partners as leverage to increase your business.

Manulife Financial, through its affinity markets division, has a service available to advisors where they will develop a link to your existing website that creates a unique website with your company brand and information. This site allows clients to automatically get health and dental, and travel insurance quotes online. It also allows them to apply online and, if they purchase a plan, the commissions are automatically tracked back to the clients’ producer code. In our regular monthly e-newsletter, we reminded clients about our ability to provide health, dental and travel coverage and directed them to our unique Manulife-created site. Our sales of health and dental increased by 40% and travel went up by 15%.

4. We held a client appreciation event.

Each year we hold a client appreciation wine and cheese event in June. During this event we speak about what happened over the last year and what we are doing to keep clients on track with their goals. This year, we expanded the room size to accommodate more guests. When we invited clients, we put a large emphasis on their ability to invite one or two couples whom they felt might benefit from attending. We reminded clients that their colleagues, family and friends may need help during these times, that they probably don’t have a financial plan, and that they should consider referring them to us as we can help them during these turbulent times. The revenue results from this event are not yet in, but we have the highest number of people signed up in our 11 years of holding this event. A client event is a great way for potential clients to learn about what you do without having to commit or be in a one-on-one situation. If referrals who attend decide to engage, we will increase our assets under management.

5. We became a one-stop solution.

Over the years we have worked toward making our firm a one-stop shop that could provide a solution for almost all of our clients’ needs. In 2007, one of our team members became licensed as a mortgage agent. We are now able to act as a mortgage agent and offer our clients discounted mortgages. We only provide mortgages for our existing client base and have found clients thrilled to have us handle this for them as we can save them a trip to the bank. Of course, the client needs to sign lots of forms and disclosures, but it’s a win-win situation. This year, we have seen mortgage revenue grow twofold from last year, which has provided a much appreciated boost in revenue during the slower summer months. If you are thinking about doing this, just make sure you have signoff from your compliance department and have the right disclosure forms ready.

These are some of the things we are doing to increase branch revenues. Taken alone, none is a particularly big revenue generator but if you add them all up, you can begin to see how valuable these little efforts really are. For us, the most important thing is our financial plans and making sure clients implement what they said was a priority to them. This helps keep the focus and opens the doors to all the activities mentioned above. Even if you do just one of them, you may be surprised how easy it is to increase your revenue and at the same time offer clients what they need.

Robert Abboud, CFP, PFP, has been offering financial plans for over 13 years through his firm Wealth Strategies. He is also the co-founder of Advisorpractice.com.

(06/19/09)