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IFA firms failing to plan ahead

Group 300 says the results of its latest IFA survey prove that practices using formal business planning procedures are more profitable.

The network interviewed 250 IFA firms over five weeks in May and June about their attitudes to business planning.

It says it found an “ostrich mentality”, with many advisers waiting to see what would happen to their practices rather than being proactive and planning for the future.

The results show that only 11 firms, less than 5 per cent of those interviewed, have a formal business plan. Group 300 says there is a strong correlation between this small number with a plan and profitability and staff performance.

Taking £80,000 commission or fees earned per adviser per year as an average figure, the group found that almost all the firms with business plans had staff performing at or above this average.

Group 300 CEO Chris Batten says he wants to encourage providers and the FSA to spend more time helping IFAs to “work on their business rather than in it”.

Formed from Advice Store Group in January this year, Cambridge-based Group 300 runs an IFA network, a compliance consultancy and a conferencing business.

Batten says: “This comes as no shock to us: “We come into contact with many IFA firms during our working week and it is clear that the industry as a whole does very little to inform or educate the IFA in the benefits of formal business planning and strategic thinking.

“Our industry seems to have more than its fair share waiting to see what is going to happen, rather than planning the future based on good intelligence and dissemination. “

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