Five Tips from Accountants on How to Get Referrals

Advisor Perspectives welcomes guest contributions. The views presented here do not necessarily represent those of Advisor Perspectives. Dan Richards

Over a recent lunch, three partners in a small accounting firm told me how financial advisors should go about getting referrals.

Ranging in age from their late 30s to mid 50s, they focus on mid-sized businesses and farmers, a good number of whom over time sell their properties to real estate developers and have to deal with the “sudden wealth” issue.

They get regular calls from financial advisors, who are sometimes referred by a client or someone they know; on other occasions the calls are cold. Typically the focus of the call is the advisor’s desire to set up a meeting to discuss the process and approach they have successfully used to manage investor portfolios.

Almost all of those attempts by advisors fail.  But these accountants identified five successful strategies for advisors trying to establish referral relationships:

  1. Get introduced

    In their experience, the chances of an advisor getting in the door as a result of calling cold are virtually zero; the only way they’d meet with advisors is if they already knew them, the advisors worked with a client or the advisors were referred by someone they know and trust. The one exception is if they heard a financial advisor speak at an event put on by a local accounting society and that advisor said something that really captured their interest.

    I asked how they’d react if they got a call from an advisor saying “We’ve got a client in common. I’ve heard great things about you from Bob Smith and am calling to see if we can schedule time for a coffee, to learn more about you and the kinds of clients you work with.”  All three said that chances are they’d make time to meet – the key words being “we have a client in common.”

  2. Understand going-in perceptions

    All three emphasized that to establish a referral relationship, advisors need to be seen as just as professional and client-focused as they are.

    This is a challenge.  What I’m about to say won’t be good news, but the partners told me that in their experience, many accountants view most financial advisors as glorified salespeople rather than true professionals. The bar to becoming an advisor is seen as dramatically lower than what it takes to get your accounting or law degree, these accountants said – and advisors who are compensated directly or indirectly by their sales are seen as only slightly above someone who sells high-end cars or real estate.  Even some advisors who are paid on a percentage of assets are included in this category.

    In fact, they suggested that many accountants see advisors the same way that some advisors view real estate agents – some real estate agents are excellent, but many are primarily motivated by the immediate commission on a sale. For that reason, just as many advisors would be cautious if approached by a real estate agent about the possibility of establishing a referral relationship, so accountants are cautious when approached by advisors.