Nearly two thirds of advisers saw their client numbers jump during the course of the Covid-19 pandemic, driven by greater use of technology and software.
A report by data and technology company FE fundinfo found that nearly 60% of advisers reported more clients over the past 12 months, compared to just 5% who saw a decrease in the number of clients.
Nearly nine in ten (89%) advisers also increased investment in their business, with 58% investing more in new technology and 40% investing in back office systems. Nearly two fifths (38%) turned their resources to staff training, while 26% invested more in recruitment.
As a result, 58% of advisers said they felt more positive about their business outlook compared to the previous year.
Mark Chanda, head of adviser sales at FE fundinfo, said: “There was naturally a great deal of concern among advisers at the beginning of the pandemic about how their operations would deal with a sudden switch to working remotely. In an industry where face-to-face and personal relationships count for so much, it is pleasing to see that advisers for the most part have responded quickly and effectively and have recognised how they can use it to save time and streamline their processes.
“With increased investment in their businesses and in technology, advisers are adapting well to the new environment and will arguably be in an even stronger position to take advantage of further opportunities which will undoubtedly arise. In the coming year, advisers will need to ensure they are using the right technology to capitalise on the efficiencies they have gained over the past year and integrate their existing tools with new offerings in the market.”
However, the research also discovered growing concern around rising costs, regulation and market conditions in the wake of the pandemic and Brexit. Nearly three quarters (73%) cited existing regulation as their biggest concern for the year ahead, followed by increasing costs driven by PI insurance (53%) and uncertainty in the markets as a result of Covid and Brexit (35%).
Chanda added: “Increasing costs are a perennial thorn in the side for advisers. It is difficult for advisers to look at their charges, particularly when their own margins are stretched by rising costs, but advisers recognise that the value of advice and interaction with their clients is now more important than ever.
“What we have seen from our research is that on the whole advisers are being nimble and making the most of the new opportunities on offer. For those adapting to the new way of working, a large pool of non-advised potential clients who are sitting on increased savings pots presents an opportunity for further business growth.”