It is sad to see that the announcement of depolarisation has left so many people in a state of confusion.
People think the end of the world has arrived and are defending the indefensible. There is no need to panic – depolarisation is good news and IFAs should all welcome it.
Let us take a look into the future. There is no polarisation anymore. Multi-ties are the order of the day. The old-style compliance networks (OSCNs) are dead in the water. They have nothing to offer except box ticking.
Not to say compliance is not important – of course it is – but let us follow the FSA lead and regulate by risk. If the sale is a simple sale, with little risk, then reduce the box tickers to suit. People will leave the OSCNs in droves.
They made their living off the PIA style of regulation, selling their proposition on fear alone. They are now squirming as they try and pretend to be more than just a one-dimensional box-ticking machine.
Goodbye Freeloader Network plc – I will leave you to sort out the scandals of the past (after all, I have paid you to do it already). I am moving on to the 21st century.
Then there is tied. The spin of the direct salesforces (DSF) will be that it is multi-tie but it is not. Do not be fooled by the propaganda, the nice new brand and the promise of high rates and lots of cash. It is the same old wolf in that cuddly woolly coat.
To be fair, it was great training for new entrants to the industry but who wants to go back to selling one company's product (plus a few insignificant gaps)?
So where is the future? A few specialists will corner the fee-paying market and, as now, will do it well.
This will be 5 per cent or less of the market and will be an impossible model for most IFAs – the majority of us should forget the idea.
The answer for most is to belong to a so-called distributor firm. They will have good deals and excellent relationships with a range of product providers and will offer the compliance service that the OSCNs offer.
More importantly, they will be run and managed by business people who are sales people. People who understand the needs of the sales person (do not be frightened by the word – this is a sold market not a bought market – products need selling or there would be no need for us), managers who have a good DSF background, who have a history of developing people and who are prepared to offer you a real equity stake in the business – these are the things to look out for. There are several companies out there today with this proposition.
It is a bright outlook for us all. We will be able to provide choice to the consumer. We can work in a supportive co-operative environment with like-minded people.
Our companies will be better capitalised through more solid provider relationships, and we will get real help and personal development from people around us.
I would suggest that most IFAs have not had any real personal development for a decade. The sole practitioner could learn many additional skills from the new style of entrepreneurial business leader. In fact it will be essential to stay alive and move with the times.
Don't panic. Choose the right firm to team up with, and be confident about a bright future where we build capital value for ourselves as a group – not for Freeloader Network plc or Tied and Handcuffed DSF.
Start Independent and Simply Assured,Telford, Shropshire