Dealer group positioning translates to dollars

While distributors may define their dealer groups’ adviser positioning and value proposition carefully, how does this affect the outcomes for individual planners?

In the Top 100 Dealer Group survey, dealer groups were ranked on average funds under advice (FUA) per planner and average clients per planner.

Comparing these statistics for the dealer groups sitting underneath a parent institution can be revealing — in terms of how a value proposition and client target market translates into bums on seats and money in the bank.

AMP director of advice-based distribution Steve Helmich said when the group compared the top 40 planners in Hillross and AMP Financial Planning (AMP FP), the results were remarkably similar.

However, the table above shows that AMP FP planners have on average $18.72 million in FUA and 535 planners, compared with Hillross planners’ $23.26 million average FUA and 620 clients (Arrive was not disclosed).

Helmich does say that AMP FP is more geographically spread with greater representation in rural areas. This may account for the group’s lower average.

Of ING’s dealer groups, Retireinvest is the brand-focused operation, with a significant shopfront presence. It is mainly focused on the middle to more affluent pre and post-retiree market.

With less prominent branding in the ING stable are Tandem Financial Advice, which houses advisers targeting specialist markets who tend to trade under their own names ‘in tandem’ with the advice brand, and Millennium 3, which primarily has life risk and superannuation advisers, who were previously aligned with life insurance brokers and which are transitioning to FSR licences over time.

The figures for Retireinvest and Millennium 3 (Tandem was not disclosed) bear these differences out, with Retireinvest planners averaging $34.72 million FUA, compared with just $4.6 million for Millennium 3.

Tower’s dealer groups also show significant differentiation along investment/risk lines — with the risk-focused Pivotal dealer group, relaunched last year, netting on average a tiny $770,000 in FUA per adviser, compared with the $36.5 million per planner for its other financial planning advice group, Bridges.

Aon is another example. Advisers working for Aon Wealth Management on average generate nearly twice the FUA of their counterparts at Aon Financial Planning & Protection (Aon FP&P). The former was created as a specialist financial planning company founded through a joint venture with Ipac, focusing on planning and wealth creation advice via a lifestyle planning model. Aon FP&P, on the other hand, has a significant focus on risk, with some authorised representatives offering advice in financial planning and superannuation.

The effect of different advice offerings is clearly evident in MLC’s figures. Apogee Financial Planning services self-employed financial planners with a boutique feel and averages $15.56 million FUA per planner.

Garvan Financial Planning also works with self-employed planners and focuses on service provision and business growth — with planners bringing in an average of $21.85 million FUA.

National Australia Financial Planning’s salaried advisers enjoy the benefit of referrals from the National’s banking client base — and an average of $28.4 million FUA, while the high-end Godfrey Pembroke group nets $39.33 million on average for its planners, who target high-net-worth clients.

And while Zurich has an arm’s length relationship with all its dealer groups, its figures show an enormous difference between Financial Lifestyle Solutions, Australian Financial Services and Lonsdale Financial Group — ranging from $5 million FUA and 500 clients per planner to $27.78 million FUA and 266 clients per planner.