Business growth now biggest challenge for advice firms
9 July 2020
Nearly a third of advisers (30%) expect business growth and efficiency to pose the biggest challenge to their business over the coming year, up from 19% last year, new research from Nucleus has found.
The findings from Nucleus’ 2020 census showed that 51% of respondents admitted that time spent on compliance limits their productivity. Over two fifths (42%) said an increase in demand for their service had placed a strain on their workload, while a further 40% attributed capacity issues to spending time on processes that could be automated.
Following the recent lockdown, 30% of firms said they were exploring alternatives to face-to-face advice in a bid to increase efficiency, up from 25% last year.
According to the wrap platform, professional indemnity insurance was also found to be a major concern for advisers, with 52% stating that cover had become much more difficult to secure and 62% noting it had become much more expensive.
In contrast, regulation has become less of a worry for advisers, with only 19% citing it as their primary business concern, similar to last year’s census, but a marked decrease on the 27% recorded in 2018.
Nucleus said advisers see growing demand for financial advice as posing the biggest opportunity for their business (45%).
Barry Neilson, chief customer officer, Nucleus (pictured), says: “Our latest census has found advisers are increasingly concerned about their ability to sustain and grow their current capacity. But it has also shown they are increasingly looking for new creative ways to communicate with clients, which will enable them to increase the time spent on their business.
“Advisers’ experience through Covid-19 is likely to embed this shift towards virtual communication and allow advisers to more frequently check in with their clients, perhaps instead of holding one or two face-to-face meetings a year.”
Neilson adds: “From our census we also now have hard data on how difficult it is for advisers to find PI cover, both in terms of availability and affordability. The lack of options is clearly putting advisers and planners in a position where they need to spend excessive amounts of money on cover which could have gone to servicing their clients or on business development.”
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