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Very few financial advisors grow their practices at least 15% per year. Many prospect for new business for the first few years, but slowly slide into mediocrity. Most FAs I see work long hours but spend less than two hours a week attempting to grow their business.
One of the first things I do when coaching them is to learn five things:
- Their income goal for the next 12 months;
- The number of weeks they want to work in a year;
- Their number of A and B clients;
- How often they talk to existing clients and reach out to past prospects; and
- The number of referrals they get per week.
What Is Your Income Goal 12 Months From Now?
One of my clients said he doesn’t like to set goals because he feels disappointed when he fails to hit them. Another set goals early in his career, but his practice is now on autopilot.
It’s sort of like the producer who walked into his manager’s office and said, “I can’t hit my goals this month.” The manager said, “What do you mean? I paid a motivational speaker $5,000 last quarter to pump you people up. Do you remember what he said? Be positive. Have a positive mental attitude and stay positive, positive, positive. What do you have to say?” The producer told his manager, “In that case, I am positive I can’t hit my goals this month.”
Break Down Your Goals Into Weekly Chunks
Let’s say, your goal is $500,000 next year, including $240,000 in new money and $260,000 in trails and renewals. Your average sale is $5,000. If we broke that up into 12 months, it would boil down to four cases per month. Getting more granular, you would need one case each week.
4 Stages
There are four stages of a sales process, and your next step is to calculate your ratios for each.
1. RPCs (revenue producing contacts)
These are client and prospect contacts. What percentage of these contacts result in opportunities for new business? If you don’t know, you won’t be able to hit your goals. If you were my client, I would start you at 38%. This is the percentage of clients you talk to who have new money, whom you can upsell, as well as prospects who will book an appointment with you.
2. Probe
This is the fact-finding stage. Even when you talk to long-time clients, you must still probe for needs. What percentage of these folks want to book an appointment to hear solutions? If you listen instead of pitch, this number should be at least 85%. The other 15% aren’t qualified or can’t make good decisions.
3. Present Solutions
There are two reasons why prospects and clients don’t buy. You may have presented too much information and they became confused. (I bet you thought the answer was not enough information.) Or they may not trust you. It could be that you used the jargon of a used car salesperson and said, “Would you be interested,” or “Is there any reason why you couldn’t do this today?”
When you calculate your own ratios, you can create your own weekly plan to hit your annual income goal. Your calculation process should include the numbers listed below:
Cases needed per week ______________
Presentations needed per week ________________
Probing appts needed per week______________
RPCs needed per week____________
How Do You Do All This?
I have previously written about many skills you can use with each step.
1. RPCs
Use the three-month call script. This process includes talking to your existing clients and presenting a market update. Then ask about any assets you don’t know about that could be at risk. Next, use the five-step bridge to find out three needs. At that point, recap their three needs and trial close to book an appointment. If these terms are foreign to you, search for my past articles in this publication to review.
2. Probing Fact Finding
Start with an elevator speech. Then discuss an agenda for the appointment. Ask questions about their goals, lifestyle, future needs, family, risk tolerance and — finally — their biases. Are they against annuities, life insurance or even alternative investments? 28% of prospects, for example, would never buy an annuity.
If you think fact finding is about asset allocation and longevity risk, you are wrong. It is about making the prospect or client feel understood and gaining enough information to put together a financial or retirement plan. If you do this effectively, 85% will book a future appointment to hear your solutions.
3. Present Solutions
This is not about a financial or retirement plan. It is about building enough trust that the client or prospect believes you will hit their goals and maintain frequent communication along the journey. The three things clients want from you are:
- A belief that you are doing what is best for them;
- The knowledge you are always in control of their plan no matter what; and
- Conversations every three months in which you can discuss any market updates with them and listen.
Putting It All Together
If your goal is to sell four cases per month, you will need to close one per week.
A realistic weekly business plan to hit this goal might be:
- One case closed• Two solution presentations given
- Three probing fact-finding discussions
- 12 RPCs contacted
If you map out your 12-month goal and then break it down to weekly activity, you will grow your business every day you stay disciplined enough to make the calls. I have never in my 40 years of coaching FAs seen a client fail to grow by at least 80% as long as they hit their weekly contact goals. As simple as this seems, many FAs self-sabotage by failing to reach out to RPCs. If you can stay disciplined, you will dramatically grow your practice. If you don’t, your business may stay mediocre.
I would love to send you a free video on “How to Create a Business Plan.” Write me at [email protected] or call 714-368-3650. We will first spend a few minutes talking about your goals for increasing your business this year.
Dr. Kerry Johnson is “America’s Business Psychologist.” He is the best-selling author of 17 books including the recently released, Peak Performance: How to increase your business by 80% in 8 weeks. He is also a frequent speaker at financial conferences around the world. Peak Performance Coaching, his one-on-one coaching program, promises to increase your business by 80% in 8 weeks. To see if you are a candidate for this fast-track system, click on www.KerryJohnson.com/coaching and take a free evaluation test. You will learn about your strengths and what is holding you back. Or, call 714-368-3650 for more information.
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Advisor Perspectives welcomes guest contributions. The views presented here do not necessarily represent those of Advisor Perspectives.
