Head of distribution Andy Coleman says in a post-RDR environment, businessowners will focus much more on recruitment, marketing and business strategy rather than provid- ing advice.
Coleman says: “The new breed of businessowners, who are graduates coming out of university, see an opportunity for taking roles as businessowners within the industry but not necessarily as regulated individuals. They generally have completed degrees in business management and are keen to use those skills to run and market firms and build their service offering.
“They will employ advisers, back-office staff and paraplanners. It is an appealing model to follow because the traditional model, where you have a sole trader trying to advise and run the business, will be even more difficult post-RDR.”
Coleman says this model is likely to lead to fewer orphaned clients because it will reduce the need for client segmenting.
He says: “When IFAs segment their client base, inevitably it is the small client that falls by the wayside and it is usually that client that needs advice the most. The way not to do that is through corporatised advice, which will bring a level of efficiency and drive service-based propositions.”
But Technology and Technical director Kim North says: “I do not think graduates have the experience to satisfy FSA supervisors that they have the knowledge of products and the industry to run an IFA firm.”