17 Dec Kill the 'one stop shop' – Andrew Mirams
We ask finance broker Andrew Mirams if brokers can be financial planners as well. Hear what Andrew has to say about the “one stop shop” rationale vs. getting a good team around you.
Kevin: There’s a lot of talk in the market now about the viability of brokers. A lot of real estate agencies have been into brokerage for some time, but we’re seeing them now open up into other areas – turning on your power, helping you move, even getting into insurance. Is this a good thing, the one-stop shop?
I’m going to ask Andrew Mirams from Intuitive Finance to address this with me now and talk specifically about whether brokers can be financial planners. I’ll open it up with that to start with. Andrew, is that a good idea?
Andrew: Good day, Kevin. I’m a little bit against that one-stop shop, I guess. Brokers are probably trying to now go into financial planning and even accounting and conveyancing, and things like that – more because a lot of those industries have probably tried to break into brokering.
I think there’s a fair bit of evidence out there that neither of them has really worked that successfully. There are certainly some success stories out there. But the real issue I have with it is this. it depends how many brokers or how big your enterprise is, but if the brokers are trying to do the financial planning and the insurance as well as your loan and everything, is which part are they doing well?
Are they all doing just all of it okay, or are they doing a really good job? If they’re doing a really good job, I would suggest they don’t have too many clients, and how much exposure are they getting to all the different options and opportunities that there might be out there?
Kevin: I guess you ask the question, too, whether they’re doing it themselves or whether they setting up allegiances, which is in a way what some of the real estate companies have done. They’ve set up allegiances with finance brokers. I know there are some that actually own the finance arm – as Ray White owned Loan Market, for instance –but they trade as separate entities and tell you that never the twain shall meet. But it comes down, once again, to that one-stop shop rationale, doesn’t it?
Andrew: Yes. As a client, I would always ask myself, “If I’m going there to get my mortgage and then they’re doing my planning and they’re doing my accounting, how impartial is the advice? Are they working together because they know that they’re making X amount off me, or are they really doing the right thing for me?”
There’s no right or wrong answer. I’m a really big believer in allegiances and having a really great network around you, and that’s both as a client and also as a business person, as a broker. We have a great cache of financial planners, accountants, insurance brokers, buyer’s agents, all around us so when any client comes in here, I can say, “This will be great. I think you should go and see them.”
They’re really happy. We sort of fit as the hub and we have all our spokes going out. We know we’re referring them to really good people, that our clients are going to be really well looked after.
I quite like that philosophy a lot more than having everything in-house and the clients come in they think for a half-hour interview and three hours later, they’re signing some insurance forms and they’re not really sure what they’re signing them for.
Kevin: I guess it comes down to what you said there. It’s making sure that you know the people you are dealing with, that your clients are going to be well looked after. It goes much more than any trail you might pick up or any income that you might get. It’s to know you’re going to end up with a very happy client at the end of it.
Andrew: Absolutely. I would forgo all of that to make sure I’ve got a happy client, because a happy client is going to recommend us again and again, and we’re going to do more business that way.
I’d much rather forgo all of that but have a happy client, because happy clients tell good stories. An unhappy client we tried to do everything for and mucked up, you end up losing all the business is the reality. You make one mistake on one of those entities if you’re trying to do the planning, the accounting, and the brokering and you make one blue, you’ll probably lose the total business.
I think, also, from risk management, there’s a real issue you can lose clients if one of those entities makes a blue.
Kevin: It comes down to all the smart investors I know – and we talk about it all the time on the show – have their own team around them. They have their own finance broker, their own insurance broker, their own real estate agents who they work with, so they’ve effectively got their own team. They don’t need that one-stop shop anyway, Andrew.
Andrew: Absolutely. I’m the same, Kevin. I have my own team around me, and our really strong clients and good investors have a really good team around them. They all work together but they’re not intrinsically linked, so that if one of the team recommends one thing, there’s quite an open dialogue in terms of saying, “Why are you recommending?” and “Give us the protocol.”
From the client’s perspective a good little test is “Why are you doing that?” or “Why are you recommending that?” Is it a good idea? Does that work? Go and talk to your accountant and come back to me and what I’m recommending. I think that’s a really good tasting mechanism for clients to be able to get a second opinion.
Kevin: We’d love to hear your opinion, too. Let us know through the website. What do you think? Have you got your own team? You might have a view on that. Maybe you’ve had a wonderful experience with a one-stop shop. Let us know.
We’d love to have your feedback through the show any time at Real Estate Talk. And make sure you catch up with Andrew and his team from Intuitive Finance at their featured channel on Real Estate Talk, as well.
Andrew, thanks for your time.
Andrew: My pleasure, Kevin.