March 25, 2024

 How elite financial advisors grow their practice by 15% or more every year!

Do you grow your practice, then shrink, or do you shrink in order to grow? 

If you want to grow your practice, think about the following question?  Do you grow first and then shrink? Or do you shrink your practice first in order to grow? It took me ten years to learn this. To build your practice, you need capacity or time to grow. Most financial advisors continue to grow their business, so they get to a certain revenue. Once they get to a revenue mark, they plan to add staff, segment their clients and bring on other advisors. Year after year, the struggle to maintain growth continues. Sound familiar? 

What if there was another way?

There is a logical path to growing revenue and your practice as a financial advisor. If you are at $500,000 revenue and want to grow to one million. If you are at $1,000,000 revenue and want to grow to $2,000,000 revenue. At $2 million to 3 million of revenue and growth. At $3 million to $5 million of revenue. There is a logical path. That is why elite financial advisors always shrink their practice in order to grow. At the same time, they also add highly competent and invest in skilled and expensive staff. It is completely counterintuitive to most financial advisors in growing their revenue. How do you shrink and then grow?

The logical path

The first step is planning to find 200 to 400 hours in a calendar year in order to grow your practice. This means you have to segment your clients and know how many hours you're going to spend with your existing practice. Segment and know where your time is spent with ideal clients. Segment into two segments, ideal clients or families, and everyone else. Now ask yourself these questions

Who do I want to spend my time with? ideal clients,  ideal prospects, and ideal COI's 

Who can take care of all of my other clients?  

What will my revenue be?

What will my investment be?

What is the potential gain in 12-24 months? 

Imagine if I told you to give up $50,000 of income in hopes of making $100,000 or more revenue. Would you be willing to take that risk? Now imagine if you gave up $100,000 of revenue and a year later gained $300,000 of new additional recurring revenue. Would you be willing to take that risk? What would be the cost or revenue loss if you shrink your practice today? Regardless of how you do it, growth comes at a cost. Some are more prepared than others to invest in growth. Elite advisors know they need to invest in people in their practice and at the same time, they shrink their revenue,  absorb more costs, and ultimately see a payoff one to three years later from their investment. Entrepreneurs know investing in their business pays the highest returns. 

Growth is the easier part

Shrinking your business by segmenting clients, bringing on new staff and financial advisors, and deciding who you're not going to work with, are the difficult decisions that elite advisors do on an annual basis when looking at how they're going to take the business to the next level. It is what I call the capacity crossroads. Imagine you are driving down a road and come to a T in the road. You can turn left or you can turn right, but you can't go straight and keep going down the same path. Some financial advisors turn left, by continuing to grow and adding on way too many clients. They are only deferring the problem in hopes that you can grow enough so you can absorb additional costs instead of turning right and shrinking their practice.  Elite advisors turn right when they hit the capacity crossroads, segment their clients, bring on staff,  add advisors and build teams. This is why I spend 30% of my time helping financial advisors find ideal team members. 

The logical path

I had a call recently from a successful financial advisor who was stuck at a level ( the capacity crossroads) and could not see the logical path ahead. He wasn't sure if he should add administration staff, add associate advisors or partners, or buy a book of business in order to grow. Once I showed him the logical path he could then see the clarity of the future of his business. He was prepared to shrink his practice, invest in people, and find time for himself, in order to grow his financial practice. The simple answer was to clone himself, as another financial advisor on the team, and find another administrative staff member who was technology and marketing savvy. 

The logical path in financial services is an advisor who is solo and then partners up and builds a team. Eventually, the team turns into a growing enterprise. You see that when financial advisors build a practice from 50 million to 100 million to 200 million to 300 million to 500 million to a billion and beyond.  I am fortunate that I get to work with and see elite financial advisors growing their practice from 50 million to a billion dollars and everything in between. I highly encourage you to read the ensemble practice by Phillip Palaveev, a great read on the logical path to success.  What is your logical path?  

https://www.amazon.com/Ensemble-Practice-Team-Based-Approach-Management/dp/1118209540

How about your goals for your practice in 2024?

Comprehensive Practice Management checklist

https://practicemanagement.getresponsepages.com/ 

Sample: Comprehensive Financial Advisor Practice Management Benchmarking Report

Key data and KPI's Key Performance indicators. Do want a sample benchmarking report to help you understand how to get the edge on your practice and your competition? 

https://benchmark.getresponsepages.com/

Updated 2023 Technology Checklist for Financial Advisors  

This checklist is five years worth of research on the best processes elite financial advisors and their teams implement to acquire and service ideal clients, while running an efficient practice. 

https://technologychecklist.getresponsepages.com/ 

We are here to serve your practice, let’s talk

Contact us to help get clarity around your goals on paper, and have the goals conversation by contacting
Grant at grant@ghicks.com or click on the link to set up a no-obligation 20-minute
discussion https://my.timetrade.com/book/JMTNJ regardless if we work together, let’s have a chat and listen to your biggest practice management concerns to help you get clarity around your future business.

Grant Hicks, CIM, is President of Advisor Practice Management and co-author of “Guerrilla Marketing For Financial Advisors” 1st and 2nd editions. www.advisorpracticemanagement.com for speaking,
workshops, or coaching, contact Grant at grant@ghicks.com Grants combined financial advisor clients manage over 5 billion AUM, and earn over $50 million dollars combined! 

Enthusiastically yours,
Grant Hicks, CIM, President
Advisor Practice Management
www.advisorpracticemanagement.com 

PO Box 382 Lantzville BC V0R 2H0
Cell 403 970 8895
Email grant@ghicks.com 

To book a meeting click here https://my.timetrade.com/book/JMTNJ  

PS Where do you want your financial practice to be at the end of 2025? AUM, Revenue, and time off? 

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