By George Liondis
The pointyend of fund managers’ sales pitch to financial advisers — business development managers (BDMs) — have been cut down to size by a new report which labels them overpaid and ineffective.
The report, based on a survey of 325 financial planners by the Adviser Ratings group, found that 90 per cent of advisers believe three out of every four of their meetings with BDMs are a waste of time, providing them with little or no technical, investment or product knowledge.
The chief executive of Adviser Ratings, David Child, says the findings are substantial given the key role BDMs are perceived to play in the distribution of funds management products to financial planners.
“We also know from the report that the majority of advisers are prepared to spend less than six hours with BDMs throughout a whole year. If you are only going to get six hours and advisers are telling you most of that is a waste of time, then you have a real problem and a real waste of money,” Child says.
According to Child, the base salary for BDMs with two or less years experience is $80,000 to $100,000, while the base for more experienced BDMs is in the range of $100,000 to $140,000.
However, when asked to nominate what they thought the average BDM was worth, almost half of advisers surveyed by Adviser Ratings thought BDMs should be paid less than $80,000 per year.
“There is a significant variance between the value financial advisers place on BDMs and the amount being paid to them by their employer,” Child says.
