28
Special report profeSSional ServiceS
If you base your
asset allocation and
portfolio around
ETFs and trackers,
you can demonstrate
to the client you have
saved them money
while taking some
more for yourself
“
”
Phil Billingham, director,
Perception Support
and that you are better
equipped to exploit competitive
advantage in a
market upturn.”
l Help at hand
Billingham says there
are numerous areas of
their businesses in which
advisers can identify
improvements.
One such way is increasing
revenues from your
existing book; according to
Billingham, it is common
that advisers will only
attract trail on something
like 40% to 50% of their
assets under management.
He says: “We have
helped people get this up
technology
to between 60% and 80%
through some fairly simple
measures. For instance,
some firms have a policy of
‘forgetting’ to pay trail commission
or switching off
paying trail after a certain
period. By chasing it up
IFAs can increase revenue.”
He says moving assets
to wrap accounts is another
way of ensuring commissions
are paid because
systems are automated and
can easily identify if a revenue
stream has come off.
“Another method is
simply going to the provider
and asking for more
trail income. If you have
£15m with one provider
and you are not getting
trail on all of it you should
query that,” he explains,
adding the same can be
done with discretionary
managers.
Exchangetraded funds
and passive investments
can also play a crucial role
in reducing costs to clients,
while increasing revenues,
Billingham argues, because
management charges are
so much lower.
“Asset allocation is the
driver of 90% of portfolio
returns, and most active
managers underperform
the market, so if you base
your asset allocation and
portfolio around ETFs and
trackers, you can demonstrate
to the client you
have saved them money
while taking some more
for yourself.”
l Time management
Billingham estimates 90%
of advisers spend less than
half their time on relationship
management and
new business activities and
devote too much to product
research and secondary
tasks. He says regular
client reviews and personal
communication should be
an integral part of an advisory
business.
“Put simply, if clients do
not know you exist, it is
difficult to get them to do
any business with you.”
Embracing the mouse
As software companies offer increasingly hi-tech
web-based solutions for all manner of IFA tasks,
technophobes and Luddites are learning to part
with old-fashioned, paper-based systems in favour
of computer screens
By Helen Burggraf
Computer technology is
revolutionising the way
financial advisers are doing
business – from the very
first time they meet a new
client through to the maintenance
of their portfolio
for years to come.
Companies such as 1st
the Exchange, IntelliFlo,
Quay, True Potential, Plum
Software, JCS and FinPlan
are racing to come up with
new and eversimpler systems
aimed at enabling
intermediaries to help their
clients with their financial
planning, portfolio management,
protection, mortgages
and retirement planning
needs.
At the same time, such
specialised IT systems
are also helping IFAs to
comply with a growing
regulatory burden.
Once installed, these
systems can improve a
firm’s efficiency, streamline
its operations, highlight its
strengths and weaknesses
and be an important selling
point, IFAs and other
experts note.
l 60-second portfolio
Chief among such benefits
is the time such systems
save both advisers and their
back office colleagues.
Nick Eatock, cofounder
of IntelliFlo, whose
Intelligent Office software
is used by some 6,000 individuals
in about 750 firms,
says clients tell him that
his system enables them to
prepare a portfolio report
for clients, including valuations,
“within a minute”.
In the past, such reports
would have taken these
INTERNaTIONaL aDVISER [www.international-adviser.com] May 2009
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