By Matt Lynch

The Big Profit Squeeze All Advisors Face

As the industry looks ahead to 2017, many executives are concerned about profit margins. The cost of complying with new Department of Labor regulations adds to the inexorable upward march of costs, while new competition from digital advisors (yes, we’re talking about robos) has advisors and service providers worried about fees. Costs up, revenues static or down — it’s your classic margin squeeze, which causes small firms to suffer and medium to large firms to band together in search of scale.


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The Big Profit Squeeze All Advisors Face
By Matt Lynch, Managing Partner, Strategy & Resources, LLC., November 21, 2016


Investment Advisor -December 2016 Issue

Investment Advisor cover story
December 2016 Issue



Why Firms Pay for Services They Don’t Need

Nobody wants to get a bill for services they didn’t need or purchase. But that’s what’s happening – unwittingly – to advisors as the vendors that supply them expand their service offerings.

With recent regulatory activity, such as the pending DOL fiduciary standard, riling up compliance departments and shifting consumer preferences to lower-cost advice models, players in the advisor-to-client supply chain are feeling the squeeze. In response, advisor-service firms are expanding into non-core functions – expanding their value in an effort to capture a larger slice of the pie.

Many firms are incorporating these extra services, such as asset allocation and data aggregation, into their existing advisor offering. That’s all well and good – but, as a result, advisors could be paying for the same function twice, or even more times over, because they now exist within a bundled pricing model from separate third-party firms.


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Why Firms Pay for Services They Don’t Need
By Matt Lynch, Managing Partner, Strategy & Resources, LLC., March 22, 2016



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Do You Know What You Do for Clients?

The reality is that we don’t enhance value by improving service, although that is the default for many advisors. Value is more closely linked to the offer and the relationship; it’s connected to leadership.


Most of us look at our jobs from the inside out, not from the outside in. We can’t help it; we are immersed in our process and the day-to-day details of what we do. But taking a moment to look at our job from the outside—from the client’s point of view—can be an important wake-up call. You’ll see clients can’t understand every detail of what you do. Nor should they, just as you shouldn’t be expected to understand every nuance of running your doctor’s office.

But with doctors, you understand the effects of being treated. With financial advisors, that may not be the case. It’s up to you to explain it to them.

Eventually your clients, and every other advisor’s clients, will start asking the hard questions. Before they do, you should ask and answer them yourself.


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Do You Know What You Do for Clients?
By Matt Lynch, Managing Partner, Strategy & Resources, LLC, and Julie Littlechild, Founder, If Not Now Research, Jan. 6, 2016


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Successful Transitions: Getting It Right

Journal of Financial Planning

Succession planning is a hot topic these days, as well it should be. We are experiencing a significant graying of the profession and many advisers are considering exit plans. But succession or exit planning should be a long-term process, not an “OMG, I’d better figure this out” moment.

Every financial planning practice has a life cycle; for many advisers it looks roughly like this: survival mode, “Midas” growth phase, first stumble, success, second stumble, sustainability/decline. Each of these phases is an opportunity for the business owner to evaluate the current situation and develop a strategy for moving forward. It may seem like an obvious process, but all too often it’s simply not addressed. Advisers bring their own styles and personalities to their business lives and those characteristics often inform how they run their businesses.


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Successful Transitions: Getting It Right
By Matt Lynch, Managing Partner, Strategy & Resources LLC.
Journal of Financial Planning, December 2015


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