Portfolio reporting service bureaus have been around for years, so I called eight of them, asking how much they’d charge for handling downloads and reconciliation, using details about three advisory firms for price illustrations. In examining their service prices, you’ll need to add in your cost for licensing the PMS application.
Here’s what I found about the prices and services offered by service bureaus.
Back Office Support Service (www.thebackoffice.biz). Located in Vista, California since 1996, BOSS has 20 full-time employees and serves 80 advisory firms, along with a few B/Ds. BOSS uses several portfolio management software applications–Interactive Advisory Software; Portfolio 2001 (likely to be discontinued later this year, since Advent is no longer supporting it); PowerAdvisor; and Schwab PortfolioCenter and its predecessor, Centerpiece. BOSS offers three methods for PMS support:
Remote Connection. BOSS will make downloads and reconcile accounts right on an advisor’s computer using a remote connection, and you can edit your own database anytime.
BOSS Data Transfer. This method, used by 95% of clients, employs proprietary technology for transferring data. BOSS downloads to its computers, then creates a file with only the new transactions and changes. Instead of sending your entire file, it only sends data added since the last update. Users can have their database updated two or three times a day using this method. Any changes to the advisor database must be done by BOSS.
Schwab PortfolioCenter Service Bureau. This method permits BOSS to access Schwab’s PMS application without running it locally, which means that an advisor can edit his database himself over the Web. (See Schwab in New Licensing Deal for Portfolio Management Outsourcing below.)
B-Ready Outsourcing Solutions. (www.b-readysolutions.com). Linda and Matthew Bready and seven staffers in their seven-year old Davidson, North Carolina business work with 70 firms. B-Ready, which uses Schwab PMS systems, logs into an advisor’s computer using remote access software. Almost all the firms they work with require some manual data entry. In partnership with Adhesion Technologies, as with BOSS, the firm will also start serving firms that do not have a Schwab PMS system license. B-Ready is also starting to provide firms with financial planning software support on NaviPlan Extended.
Etelligent Consulting (www.etelligentconsulting.com). The Overland Park, Kansas, technology consulting firm has 17 full-time employees, 60 clients, and was founded in October 2000.