It’s that time of year again. We asked the presidents at top broker-dealers about challenges to their business, their reps and their futures. Some of their answers didn’t exactly surprise us, but the presidents’ responses paint a picture of an industry in flux that still has a lot of potential. Editor-in-Chief John Sullivan breaks down the results.
Click here for a by-the-numbers comparison of the respondents over the past three years.
1. What issues do you feel are the most challenging to your firm business-wise in the short term (next 18 months)?
As if navigating the current volatility isn’t hard enough, throw regulation, rep recruitment and retention and all that comes with running a business into the mix, and it’s easy to see respondents have their work cut out for them. “Retaining rep force/recruiting the right reps” took the top spot, with 40% of the presidents having a hard time warding off the competition. “Federal budget troubles and ballooning U.S. debt” got a lowly 3.6%, suggesting that although it’s an election year, few are taking notice in their day-to-day business.
2. What issues do you feel are the most challenging to your firm business-wise in the long term (next three to five years)?
When asked about their longer term views, “Dealing with margin squeeze” took the top spot. Little surprise here, as a number of smaller broker-dealers have exited the business recently for this very reason. “The aging of your rep force” tied for last place, suggesting that although everyone’s talking about succession planning, the execution isn’t quite there. We’d like to be optimistic and say the reason BD presidents aren’t worried is because they’ve already planned for it, but we know this industry too well.