Tips for attracting new business

Transition planning Succession planning Insurance planning for businesses Money management A recent event I attended featured one top advisor, Shelley Nesbitt of RBC Dominion Securities, who really stood out among her peers. Here are some of Nesbitt’s tips that could lead to turning points in your business. 1. Focus on only two or three sectors. […]

By Keith Pangretitsch | May 20, 2009 | Last updated on May 20, 2009
3 min read
  • Current and future net worth: Entrepreneurs are consumed by the current and future value of their business, which includes the portfolio you manage for them. Ways in which you can contribute to an entrepreneur’s ability to create wealth through investments or strategies will put you in good standing.
  • Family: We assume entrepreneurs are successful because they make unbiased business decisions that have created a valuable business. But according to our advisor, 80% of the decisions her HNW business owners make involve family. As such, you need to understand the family dynamics and work within them.
  • Exit strategy: This is perhaps the most important challenge business owners face. Entrepreneurs have essentially three options: sell, transfer the business to the next generation or do nothing. Many successful entrepreneurs think they are not going to die any time soon, no matter how old they get. Therefore, many of them have no exit strategy, which is the most dangerous threat to their wealth. Generally, the best strategy is to set up a profitable sale of the business. Transitioning to the next generation is better than doing nothing, but often results in messy power struggles between family members and a less-than-optimal value for the business. Your goal is to properly plan and prepare the business owner for the eventual sale of the business.

Prospecting to HNW individuals is much the same as trying to attract any other type of client. HNW business owners want an advisor who truly understands their situation and can provide value to their lives through years of working with people just like them.

If you want to determine how good your practice is at attracting HNW clients, do this simple test: Count the number of clients in your book of business that pay you in excess of $10,000 in recurring revenue per year. Take that number and divide it by the number of years you have been in the business. Advisors who successfully target HNW clients bring in six to 10 (or more) HNW clients for every year they have been in business. The average is between one and three. In what range does your business fall?

Keith Pangretitsch is the director of Private Client Services at Russell Investments Canada.

(05/20/09)

Keith Pangretitsch

  • Transition planning
  • Estate planning
  • Retirement Planning (which includes both individual pension plans and retirement compensation arrangements)

    3. Identify specific client concerns.

    In the case of this advisor’s clients, business owners in the manufacturing sector, she found that three main concerns applied.

    • Current and future net worth: Entrepreneurs are consumed by the current and future value of their business, which includes the portfolio you manage for them. Ways in which you can contribute to an entrepreneur’s ability to create wealth through investments or strategies will put you in good standing.
    • Family: We assume entrepreneurs are successful because they make unbiased business decisions that have created a valuable business. But according to our advisor, 80% of the decisions her HNW business owners make involve family. As such, you need to understand the family dynamics and work within them.
    • Exit strategy: This is perhaps the most important challenge business owners face. Entrepreneurs have essentially three options: sell, transfer the business to the next generation or do nothing. Many successful entrepreneurs think they are not going to die any time soon, no matter how old they get. Therefore, many of them have no exit strategy, which is the most dangerous threat to their wealth. Generally, the best strategy is to set up a profitable sale of the business. Transitioning to the next generation is better than doing nothing, but often results in messy power struggles between family members and a less-than-optimal value for the business. Your goal is to properly plan and prepare the business owner for the eventual sale of the business.

    Prospecting to HNW individuals is much the same as trying to attract any other type of client. HNW business owners want an advisor who truly understands their situation and can provide value to their lives through years of working with people just like them.

    If you want to determine how good your practice is at attracting HNW clients, do this simple test: Count the number of clients in your book of business that pay you in excess of $10,000 in recurring revenue per year. Take that number and divide it by the number of years you have been in the business. Advisors who successfully target HNW clients bring in six to 10 (or more) HNW clients for every year they have been in business. The average is between one and three. In what range does your business fall?

    Keith Pangretitsch is the director of Private Client Services at Russell Investments Canada.

    (05/20/09)