Clerical Medical is predicting a massive cull in the number of IFA firms operating in the UK, believing the number will be nearly halved in three years.
The company claims the current 4,500 IFA firms will be slashed to 2,500 by 2004 as firms either go out of business, consolidate or tie with providers.
The prediction is based on findings from more than 30 Clerical market development workshops and open seminars with independent advisers. The company believes IFAs fall in two broad camps – the “doom and gloom” club and the “innovate and grow” club.
The “doom and gloom” club is technologically averse, ignoring stakeholder and its implications, and is undercapitalised. The “innovate and grow” club is already up to speed on technology, has a sound financial base, and has made decisions regard- ing stakeholder. They have a positive attitude and will find a way to work profitably.
Head of marketing strategy David Shelton says: “These two camps are more pronounced than ever. The doom and gloom club is a recipe for disaster and they will disappear. The innovate and grow club has realised the huge demand for products and advice. It will be the IFAs who have already got their business sorted who will survive.”