We were delighted earlier this week, in conjunction with Midwinter Financial Services, to release the results of our latest analysis on the ‘health’ of Australia’s advisory practices. Future Ready IX contains the very latest marketplace averages for over 20 key business drivers and explores strategically significant issues such as:

  • While practice revenue has remained steady at around $1.2m, operational expenses have continued to grow and the average bottom line profitability has now dropped to 24.0%.
  • Firms have increased the FTE headcount of back-office support staff to 3.6 and reduced the number of clients each adviser services down to 228 but this has not manifested in an increase in the amount of time advisers are able to spend with clients, prospects and centres of influence/referral partners. The average number of client/prospect meetings per adviser per week fell to 5.7 and only 27% of firms reported that they “touch” their best clients ten or more times per year.
  • Employment costs continue to be the greatest expense for Australian advice practices – staff salaries and benefits now account for 63% of all business expenses and represent 48% of total revenue. Of more interest however is the return being delivered on this investment. Those firms that have built a positive internal culture and strong performance management program are generating significantly more profit per owner than those who have not yet harnessed the full power of their team.

Future Ready IX highlights a number of critical business areas that many practice owners will need to address if they are to not just survive, but thrive in the fast changing and radically different business environment that lies ahead. However, notwithstanding all of the challenges, we remain extremely optimistic for the advisory profession. The need for quality advice has never been stronger and will continue to grow.

<<Click here to download a full copy of the report from midwinter.com.au>>