Special Features

Five steps to scaling your advice business

Wenda Field | Intelliflo
10th August 2020
Wenda Field Intelliflo
"Opportunities for growth may mean expanding your current customer base or you may want to branch out into new areas to meet the needs of different clients."

In an era of rising costs and pressure on margins, growing your advice firm and remaining profitable can be a tough call.

Here are some of the steps to scale your business safely:

1. Know where you want to be

Not every SME owner dreams of building a FTSE100 business. While some want to create a business empire, others just want to support their lifestyle, and most probably fall somewhere in between. Where you are on the scale is a personal choice and the amount of time, effort and risk you are willing to put in for the potential reward will be a major factor. Before embarking on growing your business, you need to know where your business is now and have a clear idea of where you want it to be so you can plan accordingly.

2. Hire the right staff and consider outsourcing

In many small businesses, a few core people often cover a large number of key responsibilities. As a firm grows, this can become unmanageable and continuing to focus on the minutia of running the company can become a distraction from growing it. Being able to delegate is crucial and organising or hiring staff into specialist roles and teams can help develop areas of expertise. However, recruitment may not always be the solution and outsourcing certain functions or services could be a better option at a lower cost to ensure the best outcomes for clients. Many advice firms use external specialists for investment management, paraplanning and compliance, but increasingly firms are looking to outsource central functions like IT, HR and administrative support.

3. Understand the customer

Customer acquisition is a key part of growing a business, but it’s important to remember the clients you already have. You also need to consider if you want your new clients to be similar to your existing customer base or if you’re targeting a different segment. In either case, knowing who your customers are/will be, what they want and how you can deliver a service to meet their needs is crucial. It not only forms the basis of your customer acquisition strategy, but it will also help you identify the people, systems and processes you need to put in place to attract and retain new customers while keeping existing clients happy.

4. Identify areas of growth

Opportunities for growth may mean expanding your current customer base or you may want to branch out into new areas to meet the needs of different clients. This could mean adding protection and mortgages to your existing investment and pensions specialism or automating parts of a service aimed at wealthy clients to make it accessible to those with lower investible assets and simpler needs. Identifying target growth areas will feed into decisions about the resources you need to achieve scale.

5. Invest in processes and technology

Financial advisers are well aware of the need to document processes to ensure suitability of advice for clients. Expanding that mindset to establish standardised processes across the business as a whole will not only help ensure consistency of advice as the firm grows, but also of customers service and experience.

Using technology to automate those processes, streamline operations and maximise efficiency will really help drive scale while maintaining quality and allowing human staff to focus on more valuable areas like client relationships. However, it is easy for growing businesses to add different tools and systems as different needs arise over time but the lack of overall integration can actually hamper growth. Taking a long-term view and thinking about the scalability and connectivity of the systems you choose, rather than opting for short-term fixes, will making building the business over time much easier.

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