“One approach were looking at is how an advisor can understand and apply a business life cycle approach,” says Brad Sorensen, associate vice president and small business market manager for Nationwide Financial Services, Columbus, Ohio.

Sorensen says agents who have a strong understanding of the business life cycle are better suited to meet the needs of their prospects, helping them plan as the business moves through each stage of the business cycle. Agents need to understand that “businesses are at different maturity stages,” he says

This may be one reason why small business owners are more apt to switch advisors, with only 30% of small business owners surveyed having kept the same advisor, according to a 2002 survey of high-income professionals sponsored by Nationwide Financial.

As a small business moves through the stages of the business life cycle, issues may become more complex and may require additional planning not previously needed.

“A lot of times business owners switch advisors as their business grows,” adds John Oliver, vice president strategic marketing services, Transamerica, Los Angeles.

“The focus of using the advisor may become very different once a small business reaches a certain size,” he says.

Sorensen agrees, “Its my opinion that when a business owner starts a new business, they enter into that with their existing financial planner, and as that business progresses, maybe that planner doesnt have the knowledge or expertise to help provide the insight,” he explains.

Gaining an understanding of where a business is in the business life cycle can help an agent identify the current needs that must be met, and get a sense of how that solution today can evolve and change, says Sorensen.


Reproduced from National Underwriter Life & Health/Financial Services Edition, September 23, 2002. Copyright 2002 by The National Underwriter Company in the serial publication. All rights reserved.Copyright in this article as an independent work may be held by the author.