While many businesses are phasing out support “frills,” new financial services advisors need all the help they can get to build up their businesses. Few firms in the industry offer a full plate of support services, but those that do were rewarded with top scores in this year’s Advisors’ Report Cards.

Across the board, industry newcomers gave higher ratings than their more seasoned colleagues for their firms’ branch managers (8.0 vs 7.3), prospecting materials (7.2 vs 6.5), advertising (6.0 vs 5.8), training (7.4 vs 6.7) and sales support (7.5 vs 7.1).

There is no doubt that rookie advisors need different types of support from their firms than the vets, who scoff at the “hand-holding” and “spoon-feeding” rookies require.
“Training, marketing and sales support are overrated,” says a Calgary broker with CIBC
Wood Gundy, at which the average number of years of industry experience for brokers surveyed is 14. But in an industry that is aging by the minute, young advisors need support — and someone has to give it.

With an average of nine years of experience in the brokerage business, the Edward Jones advisors surveyed overwhelmingly applaud the support offered by their firm. The company earned top Brokerage Report Card scores for training, prospecting materials and advertising, and placed second in sales support. “The firm sets you up to do well, and there is no excuse to fail because of all of the support it gives you,” says an Ontario advisor.

While Edward Jones offers rookies what may be the only point of entry to the brokerage business, mutual fund dealers, banks and insurance distributors are training green talent.

PFSL Investments Canada Ltd., Investors Group Inc. and Money Concepts Canada lead the pack in support services in the financial planning channel. PFSL, whose advisors have an average of only eight years in the industry, took top marks for sales support, ongoing training and prospecting materials. “PSFL gave me a chance — someone with no prior knowledge or education in the financial services industry,” says a PFSL advisor on the West Coast. “It offers great support and education.”

Investors Group also recognizes it is a training ground for new talent. “Unlike shops for which it’s just compensation, we have support in the form of product specialists, marketing and education,” says Kevin Regan, the Winnipeg-based company’s executive vice president of financial services. And its advisors seem willing to foot the bill.

“I know we lose some compensation compared with other companies, but we benefit from national recognition, marketing and administration,” says an Investors Group advisor in Ontario. Accordingly, the firm took top marks in the Planners’ Report Card for consumer advertising, and had second-place scores for ongoing training and prospecting materials.

Best branch managers

Toronto-based Money Concepts has the best-rated branch managers among the mutual fund dealers. That’s all part of the firm’s value-added proposition for rookie talent, says president and CEO Scott Sinclair. “There is a lot of integrated support for those trying to establish themselves,” he says. “But if you’ve been in the industry for 20 years, you’re not looking to head office for help in how to run your business.”

Account Managers’ Report Card champ TD Canada Trust gives the best support of the banks, with top-place scores among account managers for sales support, consumer advertising, ongoing training and branch managers. “TD makes it easy for you to move up in the industry by educating you at its expense,” says an Ontario account manager.

Bank of Nova Scotia is another top provider of support, with a first-place finish for prospecting materials and second-place scores for consumer advertising, ongoing training and branch managers. “We provide great local-area marketing, central prospecting and central leads from our data warehouse to identify customers who have investment potential,” says Wendy Hannam, executive vice president of domestic branch banking at Scotiabank in Toronto.

In the insurance channel, State Farm Canada took second place in the Insurance Advisors’ Report Card and won top marks for prospecting materials, branch managers and consumer advertising. “When new agents start with us, there is a training period that lasts nine months,” says Derek Fee, senior public affairs specialist at the Toronto-based company.

State Farm’s agents gave its sales support a second-place rating, just behind Equinox Financial Group Inc. , a “super MGA” that is also based in Toronto.

@page_break@But support for new talent comes at a price, and the return on investment can be weak.
“We invest about $100,000 in every new advisor we bring in,” says Nick Pszeniczny, senior vice president at Freedom 55 Financial in London, Ont.

The situation is similar at Waterloo, Ont.-based Clarica Financial Services Inc. “We create an entrance to the world of insurance and financial planning,” says Jack
Garramone, Clarica’s president. “However, 60% of new advisors will be gone in the first few years.”

Investment Executive’s 2005 survey results show that succession planning is on the minds of both young and old members of the financial services industry. With so few firms spending money to support new advisors, is the industry in jeopardy?

“My main concern for the industry as a whole is its ‘sink or swim’ attitude,” says an insurance agent at The Co-operators Group Ltd. in Alberta. “Without new people coming in, there will be a real problem in the future.” IE