Business Planning
By Rick Peterbok
How Many Advisors Have a Comprehensive, Detailed, Business
Plan that includes an Action Plan for Implementation?
Planning Research*
• 7% have executed a successful plan• 15% are ready to implement a plan• 28% are refining their plans• 44% said they are thinking about creating a plan• 6% aren’t even thinking about having a plan
*Investment News Advisor Survey
Value of Business Planning*• Better Results – Advisors with a plan have over 3 times
the revenue as those with an incomplete or no plan.• Better Sale Value – 75% of Advisor firms with a plan have
a succession plan. • Saves Time• Less Stress• Provides Clear Structure and Direction
*Investment News Advisor Survey
The Value of Your Advisor Business
Year Multiple of Gross Recurring Revenue
2000 2.002002 2.052004 2.102006 2.162008 2.302010 2.312011 2.33
*FP Transitions
Buy Out Terms*2011
• Down Payment – 36%
• Balance/Performance Payment Schedule – 3-5 Years
*FP Transitions
1 to 1.25
Times Gross Income Minus Expenses
The Value of a Transaction Based Business
• Establish Goals (specific with Time Lines)
• Strategy• Elements of Business
Necessary for Success (Do Yourself or Outsource)
• Key People/Personal
• Office Needs• Geographic Location(s)• Skills Necessary for
Success• Inventory of Current
Position• Competition• Financials
Preparing a Business Plan
Only A Partial List
Critical for Successful Business Plan
• Prove to Yourself it is Achievable
• Write Plan Narrative so Anyone Could Understand It (Especially if needing financing or investors)
• Commit and Implement
Why Someone Doesn’t Plan?
Optional Business Planning Workshop
1:30 – 2:30
• Leadership and Staff• What Products and Services can the Rep offer• Professionalism• Advisory Relationships• Scalable Business Processes• Technology• Financials
Broker Dealer
• On boarding process for Reps• What are the annual hard cost to the Rep• How does the BD support the Rep/Client• What is the Compensation Structure• What are the terms and conditions surrounding recruiting
new Reps• What are the OBA guidelines• What is the compliance environment• Is there a minimum production level
Broker Dealer
• How is the business processed• E & O• Email service• Commitment to growth• What types of check and balances will we have• How will we communicate…for operations, compliance, and
financials• How are audits handled• Other…
Broker Dealer
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