Of three main routes to business growth — capturing additional assets from existing clients, getting new clients via referrals from existing clients, and forming strategic alliances with other professionals — it’s this third option that may be the most productive in today’s market. The time-honored, field-tested, best practice of building strategic alliances works in both good times and bad, and is an offense activity that should be a regular part of every advisor’s playbook.
Which professionals should you aim to build strategic alliances with? The No. 1 choice is certified public accountants. Statistically, clients regularly name CPAs as their most trusted advisor, and our research has consistently shown that clients want to obtain financial products and advice from CPAs. Moreover, CPAs are under enormous fee pressure, and are facing demands from their clients to offer wealth management services. As this first chart shows, the majority of CPAs have multiple, powerful reasons for providing their clients with financial services.
Many CPA firms have failed at offering wealth management services in the past, and may still be mired in a kind of analysis/paralysis with respect to doing so. Still, a strategic alliance with a financial advisor — especially one framed around the “economic glue” of a formal fee-sharing arrangement — offers CPA firms a substantial revenue opportunity. A CPA firm can gain a significant competitive edge without having to hire, supervise and logistically support an in-house financial services provider. In short, the right strategic alliance amounts to a win-win-win for the CPA firm, the firm’s clients and the financial advisor.
After CPAs, the next best bet for forming fruitful alliances is attorneys who specialize in trusts and estate planning. To find potential strategic alliance estate planning attorneys in your area, ask your clients and centers of influences whom they work with. In addition, you may want to check out ACTEC, the American College of Trust and Estate Counsel, whose www.ACTEC.org website publicly lists roughly 2,600 high-level practitioners. Estate planning attorneys work with clients during critical “money in motion” junctures in their clients’ lives and are powerful sources of referrals.
While CPAs and estate planning attorneys are generally the best professional advisors to create strategic alliances with, the following professionals are also worth considering:
o Association executives working in your target niche market (you do have a target niche market, don’t you?)
o Business brokers
o Consultants working in your target niche market
o High-level insurance brokers
A 12-Step Process
Use the following 12-step process to create a successful strategic alliance with a CPA firm.