Advisers pragmatically offloading unprofitable clients

13 May 2020

Financial advisers pragmatically discarding unprofitable clients is a real phenomenon with new data suggesting an average client reduction of around 8% per adviser.

The data has been revealed in a briefing provided by publicly-listed CountPlus in an investor briefing to Goldman Sachs, with the company noting the rate at which advisers are leaving the industry and the manner in which those remaining are trimming their sails.

It noted that the five-year forecast remained on track for the financial advice market to shrink to 15,000 advisers with 17% of advice firms currently capable of being regarded as “willing sellers”.

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“Many sellers are under financial stress and for those with sub-$500,000 in revenue there is limited demand to acquire,” the CountPlus analysis said.

“Culling of unprofitable clients and attrition by under-services clients reduced average client numbers per adviser by 8% from 102 to 94,” it said.




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