The Five Reasons Smaller Broker Dealers Can Grow Your AUM

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Passion is essential for growing your business as an advisor, but most broker dealers don’t exactly support that vibe. In fact, the protocols in place at many of the larger broker dealers are a de-motivator that stifles even the most passionate advisor’s enthusiasm. If you’re looking to grow by realigning your practice with your inner beliefs and passions, here are five reasons to move to a small or mid-sized broker dealer firm.

1. Better client service

Confusion and ambiguity are the enemies of business growth.

Do you like being Rep #47121, or do you feel that being on a first-name basis with the person servicing your relationship is more conducive to getting things done? There are so many nuances that go along with this business, from settling trades to account paperwork to licensing and registrations.

A streamlined, direct process that results from highly interconnected people makes a difference to how your clients experience working with you.

2. Fewer marketing roadblocks

The wirehouses take marketing restriction to an extreme. This comes from their necessity to exert control over a large and quota-driven team of broker-dealer representatives.

Think about how scary it is for the compliance office who oversees hundreds and hundreds of reps. Most of the time, reps play by the rules. But you do get the occasional maverick who wants to make a point out of making your life miserable. This is the quintessential bad apple that ruins it for the rest. So as a result, anytime Rep #47121 wants to get even the most straightforward communication approved, like a quarterly newsletter, you have to go through a tedious process. Really it’s just a defense mechanism.

And you also shouldn’t overlook that the UBS and Morgan Stanleys of the world have a vested interest in preserving their brand identity. They have a centralized marketing department that spends millions and millions on campaigns that management has determined to be their strategic focus.