Financial services companies that are difficult to work with are a financial drain on most broker-dealers’ practices, a new survey reveals, and among the broker-dealers’ chief gripes are products that are complex and confusing.
These are among the key findings of a survey released by ING U.S. Financial Services, El Segundo, Calif.
More than four out of 10 (42%) of B-Ds say the amount of information, paperwork or number of products offered by financial services companies has become complicated or more difficult. In nearly three of 10 cases (29%), support worsened or became less accessible. And 11% of B-Ds say training support decreased or worsened.
“Advisors want to see the delivery of financial services become easier,” says Dana Ripley, a senior vice president of external communications at ING. “From their perspective, every hour spent doing paperwork or managing something behind the scenes takes time away from revenue-generating activities.”
Survey conclusions support that contention. Some 87% of respondents say that “when a financial institution is difficult to work with, it costs me money.” Despite improvements made at some partnering institutions, only 14% of B-Ds say it’s “much easier” to do business with these companies.
Twenty-eight percent of brokers who do report service improvements say support “became better or more accessible.” An equal percentage say “the amount of information, paperwork or number of products” offered was streamlined or made easier. Another 22% say their wholesalers have become more responsive.
Only 8% of respondents say their financial service company’s products “became less complex or confusing.” And a mere 2% of respondents cite website access or online information as resources that made their jobs easier.
When asked to rate the importance of 16 elements of a B-D’s relationship with a manufacturer, respondents flag four factors as contributing most to a producer’s success: a professional support staff; fulfillment of company promises; products that perform well; and ease of access to company representatives for questions about products.
Some 32% say it is harder to give advice to clients today compared to five years ago. Topping their list of challenges are getting people to make a decision (90% of respondents); convincing prospective clients that they need the guidance of a financial professional to prepare successfully for their financial future (85%); overcoming people’s lack of interest in financial planning (82%); and overcoming people’s intimidation about financial planning (81%).
Smaller, but still significant, percentages cite other hurdles. These include gaining clients’ trust (76%); convincing clients of the importance of planning financially for the future (74%); and educating clients about the various investment options available to them (72%).