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Are you a professional who wants to:
  • Consistently attract and retain great clients?
  • Run a more efficient and profitable practice?
  • Elevate the client experience?
  • Drive enterprise value?
  • Deploy a scalable growth model?
  • Create a panoramic branding strategy?
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Pareto Systems is a consulting firm dedicated to knowledge-for-profit professionals. Our practice management and relationship management programs are ideally suited for:
  • Financial Professionals
  • Insurance Specialists
  • Estate Planning Attorneys
  • Accounting Professionals
  • Trust Specialists
  • Wholesalers
  • All knowledge-for-profit professionals
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Blog Posting Image
2019-01-15 • 3 minute read

From a philosophical perspective, one of the most important qualities in an advisor is in having a mindset that says "My goal is not to see how big I can get, but rather how small I can stay." That sounds like a contradiction from a buyer’s perspective. Why else would someone want to buy a business other than to grow, rather than do it methodically and organically? It's still a great idea to accelerate growth through acquisition but the focal point should be on the quality of the clients, not the quantity. An advisor who was disciplined in only attracting advisors who were a good fit rather than accepting anyone with a pulse, is the ideal advisor to purchase a business from. The same holds true in terms of selling a business to an advisor with a similar mindset because ultimately you know your clients will be transitioned and on-boarded professionally and will enjoy a very soft landing thus ensuring the sellers legacy in the process.

Consistency is Crucial

Advisors who tend to consistently attract the same type of clients in terms of average asset size and other commonalities is another item on the ideal alignment checklist. The average size of the client and the platform they are on, is more important than the overall amount of AUM the selling advisor has.

Within the Same Firm

For a variety of reasons it is also a good idea to align with an advisor within the firm you are with. That's not to say that there can't be exceptions, but the clients have a degree of comfort and familiarity with the firm's systems and procedures, and fewer disruptions in terms of trust, optics and deliverables contributes to the clients’ confidence in the transition.

Maverick Talent vs. Documented Procedures

The ideal business to acquire, and the ideal advisor to sell your business to, share a common thread in terms of a good fit: they operate a business on a foundation of best practices. The business is not in their heads, it is documented in a playbook. There is an allocation of time that is tied to client classification and a service matrix. Compliance history is solid because clients are receiving proactive and reactive service that is consistent. The advisor uses a CRM that ensures that relationship history is archived and KYC (Know Your Client) is accessible easily.

How Did They Start Relationships?

The ideal financial services professional uses a fit a process rather than a sales process. He or she doesn't try to convince someone to become a client, he or she establishes an alignment between the person’s needs and the advisor’s solutions. Their clients are enlightened and in synch with the advisor’s mindset about wealth management. Other questions as part of the dual-track due-diligence process are:

  • What is the client acquisition history in terms referral genealogy?
  • What percentage of their clients were referred from the 20% who generate 80% of the business vs. From the 80% who generate just 20% of the business?
  • What percentage of their business was organically acquired vs. absorbed from within the branch or acquired by purchase?
  • Were cold-calling, mass marketing and seminars used to acquire clients?
  • What percentage of their clients are actually partial customers who dabble with other providers vs. fully empowering clients?
  • What is their process to communicate their services professionally to consistently attract new money as it goes into motion?
  • Do they have meaningful "two-way street" relationships with accountants, lawyers and other partners?

Fees vs. Commissions

Many people have oversimplified this by saying that the best business to buy is one that consists of clients who have bought-in to a fee-based compensation model. What it really comes down to is the degree of communication the advisor has used and their consistency to ensure the clients are competitor proofed making them either fee-worthy or commission worthy. Whether they receive commissions for advice, or fees for management, is secondary. The bottom line is there will be more sellers than buyers and consequently there will be many fee-based businesses for sale in the future and not all of them will be worth acquiring.

Entering the Retirement or Acquisition Red-Zone

Whenever we coach an advisor on performing solid due-diligence on a potential buyer or seller, a common response is as follows: "This sounds like work!" And it is, but use the potential of a multiplied ROI as the beacon that helps you see past the hurdles and noise that will try to conspire against you. Much of the value of the business you are trying to acquire or sell is intangible and abstract especially if it isn't defined or documented. Get out in front of the process, get your intellectual properties out of your head, and subscribe to the maxim that says "Done is Better than Perfect." As I've said before - and contrary to the old cliche - time is NOT money! Your time is more valuable than money because once it's spent you can't earn it back. Invest your time in a process and put the odds in your favor. We've seen first-hand where an advisor invested 6 to 12 months of sweat equity into the business to position it to be sold and then multiplied their outcome meaningfully. We've also seen how a well prepared acquisition and methodical transition multiplied the profitability of the combined practice measurably as well. Either way, deploy a process and execute with precision and you will unlock more value.

Continued Success!

Contributed by Duncan MacPherson

Blog Posting Image
2019-01-14 • 20 second read

Did you know that construction on the Empire State building began in 1930? This was, for a long time, the tallest building in the world and it was built during a depression. I’m asking you to apply that same vision, confidence and work ethic to your business and build something that stands above the pack, even in periods of uncertainty and volatility.

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2019-01-11 • 20 second read

How do you welcome new clients? How do you say thank you for client referrals? How do you respond to client service issues? Do you recognize milestones? As a business owner, branding is everything to your business, and everything you do is part of your branding. Everything you do matters. Scrutinize the entire client experience, and make a list of how you will respond to moments of truth. This is the first step in creating velocity, building confidence and ensuring that you are continually refining and optimizing your systems and procedures. Everything has to be rooted in process and habits.

Pareto Systems' Total Client Engagement Process will help you increase refine and define your branding. Click here to learn more about the process: www.paretosystems.com/total-client-engagement

2019-01-10 • 3 min video

In this episode Chris Jeppesen and I discuss strategies to successfully implement a ‘Fit Process’ into your practice.

Join me and Chris Jeppesen for our 2019 kick off webinar! Click here to register: https://register.gotowebinar.com/register/2776995132108639235

The Advisor of the Future - Adapt and plan to thrive while others struggle to survive

Wednesday, January 16th, 2019 at 4:10 EST

WEBINAR DETAILS: Chris Jeppesen and I, co-authors of The Advisor Playbook, invite you to join us for a strategic planning webinar where we will pass along actionable, proven strategies that will enable you to:

  • Put more sand in your hour glass through effective time allocation efficiencies
  • Refine your growth and profitability model
  • Create intellectual property and elevate the client experience to drive enterprise value

You've heard the mantra, "The best work on their business not in it. The best get from the day, not through it." If you're looking for the best practices that separate the best from the rest, this webinar is for you. See you there! https://register.gotowebinar.com/register/2776995132108639235

Blog Posting Image
2019-01-10 • 20 second read

In Honolulu at an Accelerated Mastermind with Daniel Affetto of First Trust Portfolios and Don Williams with LPL Financial. A great way to kick off the New Year!

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2019-01-09 • 20 second read

A lot of people in your market area need your expertise, but you shouldn’t spend time with people who need you at the expense of people who deserve you. You are only one person with just 24 hours in a day. Work with the people who are already convinced and let them convince their acquaintances for you.

2019-01-08 • 3 min video

In this episode Chris Jeppesen and I discuss strategies to convert client endorsements into client introductions.

Join me and Chris Jeppesen for our 2019 kick off webinar! Click here to register: https://register.gotowebinar.com/register/2776995132108639235

The Advisor of the Future - Adapt and plan to thrive while others struggle to survive

Wednesday, January 16th, 2019 at 4:10 EST

WEBINAR DETAILS: Chris Jeppesen and I, co-authors of The Advisor Playbook, invite you to join us for a strategic planning webinar where we will pass along actionable, proven strategies that will enable you to:

  • Put more sand in your hour glass through effective time allocation efficiencies
  • Refine your growth and profitability model
  • Create intellectual property and elevate the client experience to drive enterprise value

You've heard the mantra, "The best work on their business not in it. The best get from the day, not through it." If you're looking for the best practices that separate the best from the rest, this webinar is for you. See you there! https://register.gotowebinar.com/register/2776995132108639235

Blog Posting Image
2019-01-08 • 3 minute read

Each week I spend a considerable amount of time speaking to clients, answering their questions and suggesting possible courses of action. Without a doubt, one of the most frequent pieces of advice I offer is to keep going. Keep going with structured and reliable call rotations, keep mailing letters to your clients and prospects, keep communicating with your inside champions and/or Client Advisory Council, and keep the faith that you will realize a breakthrough.

Don’t make the common mistake of assuming that because you work with people similar to your target market, those people will want to hand you their investment portfolios. You cannot get around the fact that you are a stranger to them, so you have to take time to build familiarity and create in them the desire to meet you, and the desire to know what you believe in as a person and a financial professional.

Above all else be interesting and patient

In your written pieces, identify with your readers. If you know that most people are busy and reluctant to read a stranger’s newsletter or emails, state that fact right off the top. By doing just this one thing, you already distinguish yourself from every nearly other financial advisor.

Always try to send an interesting magazine article or newspaper clipping with your paper communications, or links to informative articles with your email communications. It will highlight as much about your client service as it does your professional services. A popular article used by several of our clients outlines the pros and cons of buying versus leasing a vehicle. While it may not seem like much, your prospect will come to understand over time that things like this separate you from other financial advisors.

Consider the effect of an article with a personal note that reads:

I recently met with a couple and, among other things, we discussed their plans to replace their existing car. After the meeting, I searched my article library on my computer and found this item to send them. It helped these particular clients decide between leasing or buying. I hope that when the time comes, you will find it helpful as well. Keep it handy.

Other article ideas include health and fitness, vacation destinations around your area, on-line directories of local businesses and restaurants, etc.... Do not fall into the trap of ‘sameness’, and send another article on mutual funds or other strictly investment-related content. 

Don’t stop sending until they ask you to

So what happens when you invite people to one of your social or open-house type events and they don’t come? Well, you could choose to ignore them, but that won’t get them ‘in the door’ for an initial discussion. I suggest that you follow-up with them via email or letter and tell them that you were sorry you didn’t see them there, that a great time was had by all, and that a lot of information was shared. Pass along a few of the questions that were asked together with the answers, and then point to your next event or remind them you are always available to meet to act as a sounding board on their investment and retirement plans. 

As we stated near the beginning of the article, keep going, and ensure you keep differentiating yourself, and positioning yourself as a professional so that you will attract them when you reach them at their correct stage of readiness.

Continued success!

Contributed by Duncan MacPherson

Blog Posting Image
2019-01-07 • 20 second read

Many people still think of professional advisors as salespeople on commission. Your actions on a daily basis will either validate that or prove them wrong. This is why I spend a lot of time deprogramming our advisor clients and replacing their sales approach with a consultative approach. That shift allows them to implement a service model that ensures their clients focus on what the advisor is worth, rather than what he or she costs.

Blog Posting Image
2019-01-04 • 20 second read

Don't allow yourself to become one of them - Ralph Marsten

Pareto Systems' Total Client Engagement Process will help you overcome obstacles and achieve a breakthrough in your business. Click here to learn more: www.paretosystems.com/total-client-engagement

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