Angeline Aamariah - Pros and Cons of a Referral-Based Commercial Advisory Practice

 A financial advising firm's success is dependent on referrals. According to  Angeline Aamariah, a financial & commercial business referral and advisor in Australia, top advisors receive 70 percent of new assets from clients and other members of your professional wealth management network, such as commercial lenders, corporate valuation specialists, CPAs, attorneys, and others.

So, if financial advisor referrals are so coveted and create the majority of new partnerships in the first place, is it feasible to go "all in" and create a wealth management firm that is totally reliant on referrals, i.e. a referral-based practice? 

This type of referral-based practice would gain many new clients organically through referrals, allowing them to eliminate budgets for traditional business development. These strategies include cold calls, prospect lists, direct mail campaigns, public relations, and social media marketing.

A solely referral-based practice may not be feasible for some advisors, or it may be difficult to achieve. So, here, we have listed some pros and cons.

Pros

• Sales Cycle Shortening: According to research, a referral-based sales cycle has roughly half the amount of touchpoints and contacts as a cold prospect sales cycle. This is because the referral source's confidence is carried through in an indirect manner. 
• Money-Saving: “Inorganic” business development is more expensive, time-consuming, and stressful than “organic” business development in most situations. Not marketing to "cold" prospects saves you a lot of time and effort.
• Qualified Clients: Cold prospects are less likely to be qualified than referred clients. The potential clients referred to you by reference networks are generally better qualified than cold prospects, since referral networks have a good understanding of your business and who you prefer to deal with. They're more likely to fall into your desired client category.

Cons

• Chasing: Moving to a referral-only firm might eliminate a big motivation for you if you thrive and are motivated by the full business development process of meeting and securing new clients.
• Lack of Ability to Capitalise on Referrals: You aren't ready to switch to this model because your company isn't ready to capitalise on referrals. An infrastructure change of this type is not feasible due to your lack of resources.

See, referral models aren't the direct issue between you and your practice. Your business acquisition process and your relationships with your referral sources are more important than how you acquire clients. 

What’s more, if you need any help with referral-based financial advisory, Angeline Aamariah is an expert in financial advisory, with experience in property renovation. Angeline Aamariah offers all referral-based financing services in North Sydney, so do not hesitate to contact her for more details!

If you are interested in getting any help with your business, visit https://angeline-aamariah.medium.com/ or connect with Angeline Aamariah - ARL Property Group Pty Ltd on 0426267664.