Editor’s note: Bryce Sanders is a longtime columnist with Rethinking65. Read more of his columns here.
Bryce Sanders
Everything is getting more expensive. It always does. You want to curb expenses, but not at the expense of your paid office staff. What steps can you take if you want to reduce your overhead without putting off clients? Here are 10 suggestions.
1. Encourage clients to transition to paperless statements.
This has likely been going on for years. If you bear the cost of mailing out paper monthly statements, can you encourage clients to “go green?” This saves on both printing and postage.
2. Don’t give free parking to everyone.
Do clients get free parking inside your building? Do wholesalers and other visitors get free parking, too? Learn what other options the building management offers. They might have a validation system, where you stamp the client’s parking ticket before they leave. You might keep free parking in place for clients, but not for product wholesales and other visitors. You might exchange free parking for discounted parking.
3. Hold client lunch meetings in the office.
Do you usually take clients out to lunch when conducting portfolio reviews? It makes sense to relax over a meal, but not when it is costing $100 per head in midtown. How about having food sent into the office and having lunch in your conference room? Your computer equipment is nearby. It is a more confidential environment. The food can still be good, and you avoid serving alcohol.
4. Do you really need a private luncheon club membership?
It might be traditional for your firm to have a luncheon club membership. It is a place to run into fellow business leaders. How often does this happen? What are the carrying costs of membership? If a manager takes an advisor out to lunch, it is probably more cost effective to do so at a local restaurant.
5. Recruit interns through the local college.
Headcount additions are expensive. Offices have busy and slow periods during the year. Sometimes you need an extra set of hands, other times you do not. Financial services is on the curriculum at local colleges. Do they have work-study or internship programs? Can your office benefit from the addition of one or two college interns?
6. Find less expensive seminar locations.
Where do you hold client seminars and advisor recognition events? These cost money. Shop around for a location that is equally convenient, yet cheaper.
7. Renegotiate your office lease.
Your lease will come up for renewal at some point. The commercial office market has been running into problems. You have advisors who work from home most of the time. Do you need all the office space you are renting? Can you do with less space? What are your other options in the local area? What incentives will your current landlord give you to stay?
8. Evaluate the value of your telephone service
Telecoms have been very competitive for years. A good phone system is a requirement for a financial services firm. Do you negotiate the deal or does the firm do so on your behalf? What are other managers paying in your market? Which provider are they using?
9. Put out RFPs when supplier renewals come up.
Your office uses many services. There might be a cleaning service. The copier is provided and serviced by a firm. You get your printing done and buy your office supplies locally. You use plenty of other services too. Send out requests for proposals (RFPs) when contracts are up for renewal. You might stay with the same providers, but get them to compete for your business.
10. Tap strategic partners for more support.
This is a complicated issue. Many firms work with product wholesalers, such as annuity providers, mutual funds and money managers in the separate account space. These wholesalers often do not focus on selling directly to the public. Financial services firms are their intermediaries. Your advisors sell their products. Your annual budget for each wholesaler might include money for value-added training or marketing support. Try to get them to sponsor some of your events. You could give them recognition as an event sponsor, and a speaking role, too.
Bryce Sanders is president of Perceptive Business Solutions Inc. He provides HNW client acquisition training for the financial services industry. His book, “Captivating the Wealthy Investor” is available on Amazon.
