Independent advisers ride consolidation wave

Independent advisers ride consolidation wave

Jamie Coltman and a group of mates can be found in the ocean or pool most mornings enjoying their training swim for fitness.

You might be excused thinking these North Shore boys are a bit crazy, but for the Advice Financial managing director it provides valuable thinking time and it’s a way of keeping his mind sharp as the financial advice sector undergoes a metamorphosis driven by consolidation.

Coltman says he’s seen a fair bit since he started in the business – in senior management positions first for Oceanic Capital Corporation, Asteron (Royal & SunAlliance) and Sovereign and in the past six years with his own nationwide financial advisory business.

But the past year he has concluded more definitely than ever that advisers are going to have to embrace change in their practices, be pushed out, or into uncomfortable positions.

“For several months I have been talking to colleagues throughout Australasia about the future for financial advisers,” Coltman says. “Many of my conversations were with advisers who had built their business over many years and were now trying to find an exit strategy that works in today’s business environment. Others were from groups tackling the cost of compliance and the need to embrace technology for efficiency.

“Whoever I spoke with agreed that regulatory and organic changes mean we must all future proof our businesses. Consolidation in our industry is already happening locally and it has been happening rapidly over the past few years in Australia.

Coltman says suppliers have seen an opportunity to gain a bigger share of distribution and are reintroducing tied/aligned agency contracts. Some adviser groups are promoting franchises, geared to reward the franchisor and the service agreements they provide. Australian players are searching the country for ripe plums to consolidate in one jar.

“Others, including me, believe a strong group of independents working under a united brand and sharing resources will provide clients the best advice for money,” he says. “It will become obvious soon when we announce some experienced people who are joining the group.”

The thinking has encouraged a name change for the nationwide group to Advice Financial.

“It’s what we do: we give our clients good advice on how to manage their financial affairs, we are transparent about how we do that and we get paid in return as professionals who have the knowledge to add that value,” Coltman says.

Coltman says brand names do not become respected for their “packaging”. They become trusted for what they represent. If that substance is found wanting, as an iconic fruit drink manufacturer discovered recently, the business will suffer.

Throwing the body into cold water in the mornings to clarify the mind may be bit shocking for some to contemplate. But for Coltman it fits with his holistic approach to life and his belief that clients deserve financial advice that will provide them ongoing stability.

ENDS

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