THE COALFACE: Our biggest challenge is compliance

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Former Olympic hopeful and Westpac commercial financial adviser Roger Perrett talks to Wealth Professional about the challenges of servicing the business market.

Roger Perrett has been involved in the financial planning industry since he campaigned for selection for the Sydney Olympic sailing team in 2000. His teammate at the time worked at Westpac as part of the Olympic Job Opportunities Program and thought that Roger would love life as a financial planner. He hasn’t looked back since.

He holds a Bachelor of Business and Financial Planning degree. His business predominantly services business owners, entrepreneurs and executives.

What makes a good financial planner?

I think you’ve got to be really good at connecting with people, listening and understanding people. I think there are a lot of skills in terms of being organised, being on time, being professional and things like that, but I think the biggest skill that you have to have is connection.

Where do some planners fail in connecting with clients?

Everybody you see is at a different knowledge base, so I think where some planners fall down – there’s probably a number of reasons for that – but if they can’t explain complex scenarios or complex strategies in a simple way, or in a way that the customer can relate to, I think that’s a big reason where they’ll ultimately fall down.

What do you like most about being a planner?

All our customers are business customers, so they’re all in the SME-type market. The biggest thing that I enjoy is that I talk to entrepreneurs every day. They’re really passionate about what they do, and I think my client base is what I really enjoy the most.

Is the business market a good market to be in at the moment?

I love it and I think it’s a good segment to be in. I think it comes down to the type of customer that you’re dealing with. They’re in business, they understand risk – so you’re starting off on a good position there. They’re very commercial. So in terms of charging fees they understand the costs of doing business. They understand that there’s a fee for the service.

And at the moment the SME market isn’t doing so bad in Australia. Obviously when the economy turns around the SME market will do even better, but I think for those couple of reasons it’s a good spot to be in now.

Are some of your clients hard negotiators when it comes to fees?

Yes, it is probably a generalisation to say that all businesspeople are easy to negotiate with, but I think generally they’re more commercial. But you are going to come across some people whose business is about getting the best price from the supplier, so when they come to us they use the same philosophy – trying to get the best deal possible. But generally commercial customers are quite good in that respect.

Has FoFA and the fee for service regime affected your business?

It hasn’t really changed too much for us. We always had to disclose, so that’s exactly the same. The only way that it’s really changed for us is the collection of the fee. Instead of coming from the product provider we’re invoicing the customer directly. So I think from our perspective we’ve been doing it for a number of years and it hasn’t really changed. It’s more of an administration change than a big impact.

What has been the biggest challenge over the last 12 months?

I think the biggest thing for us is compliance and administration. Westpac takes their compliance really seriously. The increased level of compliance and processes is probably the biggest thing that we’ve had to deal with, so the number of Westpac policies has increased dramatically. I think that’s potentially a direct result of FoFA.

The cost of business I think is definitely going up, so it’s just trying to change your processes so you’re more efficient and can deal with that additional burden.

How do you set targets?

We get measured on a couple of things. In terms of our targets it’s a customer feedback-type scenario: How they feel about the level of advice that they’re receiving? So we’ve got certain targets there that the business benchmarks us on.

The other one is making sure we’ve got enough revenue. We don’t have a revenue growth target per se, we’ve got an overall revenue number and a new business revenue number.

Do you have any advice for financial planners?

What helped me was going along to see other financial planners. I think that’s really important. I’ve been doing this for 13-odd years and there are always new ideas. I think it’s really important to feed off the guys who are doing well. Stick with the good guys and learn from them. Skills are important, but when you go and see those planners you’ll learn other ways to explain difficult concepts in a simple way. Effectively a lot of what we’re doing is teaching.

Especially when times are tough you can stop picking up the phone, and get a bit introspective, rather than keeping looking out to see what other people are doing.

More stories:

THE COALFACE: Planning for a cause

THE COALFACE: A man is not a plan

THE COALFACE: My biggest mistake revealed

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