Performance a Must at Jones
Things have changed at EJ folks. Used to be if you ran a legal, ethical and profitable office, you had a job no questions. That’s the way it has always been sold to new brokers. Well guess what, that was a lie. Now you must be above the “meeting expectations” line on the performance chart. The other three are no longer what keeps you in a job.
Wake up underperformaers at Jones, you better be beating expectations soon or you will be called on the carpet. It's a new day at Jones.What are the performance expectations by chance?
$18,000 gross I do believe. That is a monthly number.
$18m is now beating expectations??? For a 5th year broker or ongoing? If this is the ongoing #, I just giggled a little.
I pretty much thought to be profitable you had to be at that number anyway. Wouldn't legal, ethical and profitable keep you above that line anyway?
I understand that perhaps they are cracking down more, but I believe the old saying still holds true more or less.
[quote=Dark Knight]
I pretty much thought to be profitable you had to be at that number anyway. Wouldn't legal, ethical and profitable keep you above that line anyway?
I understand that perhaps they are cracking down more, but I believe the old saying still holds true more or less.
[/quote] More or less? Not sure what that means. It is either true or a lie.I a person gets fired for being under the meeting expectations line, yet is doing the other three, that is not more or less. Jones from what I am hearing has renigged on the old hook legal, ethical and profitable.18K is MINIMUM expectations after about 4.5 years. That is not the EXCEEDING expectations line. Nobody is going to get canned for not EXCEEDING expectations. And I know several people at or slightly below minimum for many months that are not in danger of being canned. They raised the bar from 14K per month, as 18K is around the average threshold for an office to be profitable. I think OldGuy needs to get his facts straight. If you can't do 18K per month after 5 years in the business, you probably don't belong in the business. Or you should be in some little one room office with a laptop and a printer.$18m is now beating expectations??? For a 5th year broker or ongoing? If this is the ongoing #, I just giggled a little.
My point old guy, is that few offices can stay under that line and even be profitable (and even less can for any extended period of time). So if you are profitable you are probaly above the minimum anyway. So Jones hasn’t really changed, they’ve just upped the line and been a little firmer to their own policy.
You guys missed my point.
Point being that "legal, ethical and profitable" is no longer the baseline. That is what was told to many people as they went through KYC etc. Are you getting the point here? Please don't ad more of your own insights. Stick to the main point please. A lie is a lie is a lie. No matter how you spin it. If I lied to my clients I would be fired or worse. Period.[quote=oldguy]You guys missed my point.
Point being that "legal, ethical and profitable" is no longer the baseline. That is what was told to many people as they went through KYC etc. Are you getting the point here? Please don't ad more of your own insights. Stick to the main point please. A lie is a lie is a lie. No matter how you spin it. If I lied to my clients I would be fired or worse. Period.[/quote] You are correct, OldGuy. Legal, ethical, profitable. And over time, costs creap up, and the number you hit for "profitable" has to grow.What you construe as a lie is, in fact, not a lie at all. I don’t know of a single office that can meet profitability at $14K gross on average. Certainly none in my region. For most offices the number is going to be something like $21 - 22K gross, just to get to a meager profitability number. Mine is somewhere around $22K. And Jones hasn’t abandoned the legal, ethical, profitable mantra at all. The numbers just get adjusted from time to time.
But maybe the expenses in your office NEVER change. Maybe you bought a bunch of $.29 stamps years ago and the post office is still letting you use just one of them to mail a letter. Maybe you bought a bunch of toner cartridges and have them stockpiled. Maybe your rent is fixed forever and won't ever go up. Maybe the cost of paper doesn't change at your Office Max. Maybe you don't give your assistant a raise every year. Who knows. Maybe your office is somehow immune to inflationary pressures. If so, could you teach us all how to run our businesses like you?The oldguy is obviously dense. We can try to explain it to him 10 times. He still won’t understand.
[quote=Spaceman Spiff]What you construe as a lie is, in fact, not a lie at all. I don’t know of a single office that can meet profitability at $14K gross on average. Certainly none in my region. For most offices the number is going to be something like $21 - 22K gross, just to get to a meager profitability number. Mine is somewhere around $22K. And Jones hasn’t abandoned the legal, ethical, profitable mantra at all. The numbers just get adjusted from time to time.
But maybe the expenses in your office NEVER change. Maybe you bought a bunch of $.29 stamps years ago and the post office is still letting you use just one of them to mail a letter. Maybe you bought a bunch of toner cartridges and have them stockpiled. Maybe your rent is fixed forever and won't ever go up. Maybe the cost of paper doesn't change at your Office Max. Maybe you don't give your assistant a raise every year. Who knows. Maybe your office is somehow immune to inflationary pressures. If so, could you teach us all how to run our businesses like you? [/quote] Exactly, at my office the gross has to be $24,500- $25,000 to reach profitability.. Kinda sucks but hey that is a metro area for you.. Rent is expensive, My assistant is expensive and my marketing is.. Oh well.. Miss J[quote=MISS JONES][quote=Spaceman Spiff]What you construe as a lie is, in fact, not a lie at all. I don’t know of a single office that can meet profitability at $14K gross on average. Certainly none in my region. For most offices the number is going to be something like $21 - 22K gross, just to get to a meager profitability number. Mine is somewhere around $22K. And Jones hasn’t abandoned the legal, ethical, profitable mantra at all. The numbers just get adjusted from time to time.
But maybe the expenses in your office NEVER change. Maybe you bought a bunch of $.29 stamps years ago and the post office is still letting you use just one of them to mail a letter. Maybe you bought a bunch of toner cartridges and have them stockpiled. Maybe your rent is fixed forever and won't ever go up. Maybe the cost of paper doesn't change at your Office Max. Maybe you don't give your assistant a raise every year. Who knows. Maybe your office is somehow immune to inflationary pressures. If so, could you teach us all how to run our businesses like you? [/quote] Exactly, at my office the gross has to be $24,500- $25,000 to reach profitability.. Kinda sucks but hey that is a metro area for you.. Rent is expensive, My assistant is expensive and my marketing is.. Oh well.. Miss J[/quote] Are you kidding me? Wow. I'm taking bets on the next EDJ'er to go indy! I only need to do about 16-18K, and I thought I lived in an expensive area. How much is your rent?Rent is $3,500 not including Utlities.
Miss Jones, I would charge you 1/2 that…and pay the utilities. Of course…there would have to be other compensation…to forgo the cashflow. Think about it…and let me know.
Geez, that's gotta be like $35-45/sq. ft.?? I'd take Spears up on his offer.Rent is $3,500 not including Utlities.
I had to gross about $25K/month to be profitable. I had high rent and high BOA salary, but that stupid allocation calculation is what killed me.
Miss J - do you use Bill Good or something like it?
The oldguy must have dementia. If you aren’t pulling 18k numbers by year 5 reasonably consistently, move to a bank. Who cares is 10 offices out of 10,000 can be profitable at 14k. Simply moving the line up by inflation puts the minimum expectations about the same spot they were 10 year ago anyway. This has got to be one of the most idiotic threads I have ever seen on this board. If you aren’t striving to do more than 250k gross a year, move to a different firm.
Again, more topic changing going on here. How freaking stupid are you people. Read my original post. What is it about? Use your dam head if you are going to be a smart azz and reply to this thread. READ THE ORIGINAL POST. WHAT IS THE MAIN POINT?
Your original post is wrong. That’s why we are arguing. You do not need to be above Meeting Expectations. You need to be above Minimum.
I think Oldguys point is that Jones dropped the “legal and ethical” portion of the wording, insinuating that profit is ALL that matters.
For the record I have no dog in this race.
We got your main point. Like B24 said, you were just wrong. Let me explain myself so I don't come across (any more than usual) as stupid. Jones has always said legal, ethical, profitable. Ethics are somewhat difficult to mandate so they just make us take an ethics course every year. I'm over simplifying, but you get the point, I hope. Legal - Do something illegal and you get fined or fired. That's an industry standard, sometimes out of Jones control. It's always been that way. Profitable - Yes, the minimum expectation line moved from $14K to $18K (see previous inflationary posts). Does that mean that Jones is trying to squeeze out all those guys who have been out for 15 years grossing $15K a month. Possibly. Those branches aren't profitable to Jones. The $18K a month figure is probably a little low if they wanted to make sure that every Jones office was going to be profitable long term. It wouldn't suprise me if they moved it to $22-24K 10 years from now. Fundamentally, nothing has changed at Jones. You can be under the minimum expectations bar for months and nobody says a thing. If you drop too far down they might put you on goals. At that point it's a matter of getting your numbers or getting out. But it's not an instant firing. That's the way it's always been. So, they're still using the legal, ethical, profitable line with us. It fit 10 years ago, it fits now.Again, more topic changing going on here. How freaking stupid are you people. Read my original post. What is it about? Use your dam head if you are going to be a smart azz and reply to this thread. READ THE ORIGINAL POST. WHAT IS THE MAIN POINT?
Exactly, nothing has changed, the number has been pushed up for inflation.
(Although I have heard they are cracking down a little more on those who are actually below the line.)This thread has got to be the stupidest discussion I have ever seen. Oldman, if you are spending time figuring out what to bitch about later, please make the topic at least relavent. Maybe if you were making calls instead of posting on this forum, you might not have to worry about being below standard?
LOL…thanks for the advice.
Hello people. The writing is on the wall. Jones is going to be “with” somebody. Unfortunately the seller has to lie about selling or the sale will never happen. Company:“Hey Mr broker, come and work for us, and by the way we are selling out.” Broker:“Sounds great! Where do I sign up? I’ve always wanted to work for a company thats selling to another. Can you tell me what companies are interested so I can research them?”
What are you talking about??
Why? That’s the big question. Why would EDJ want to sell out to anyone? Talk about a mass exodus. The day Jones announces that they’re selling out to some big bank somewhere is going to be LPL and RayJay’s biggest days ever. The one thing us cult members won’t stomach is some outsider pushing our buttons. It would be the worst mistake a purchasing firm could make. I can see it now…“Sure that’s a fair price for 10,000 FAs…wait, 8,000…hold on, 7,000…well crap, that’s not a good price at all.”
Of course you're saying, but that what the guys at AGE said too. We're not for sale. Unless you are a publicly traded company who's shares were being purchased by a rival bank/brokerage firm and you were about to become a part of a hostile takeover. Better to fall on your own sword than to be sliced and diced by someone else. Exactly what writing is on the wall?I did read in the WSJ about Amway wanting to expand it salesforce…could be a good fit. What if Amway bought EDJ’s…what would you do then Spiffy? Don’t forget, LPL and Ray Jay have minimums on experience and production, so with the amount of turnover I would say 1/2 would be eligible and only the US reps…so what maybe 4000 would be eligible.
Gosh…if they did get bought and all the EDJ’s reps left, Weddle would be on the phone to your or is it EDJ’s clients and bashing ole spiffy. He left cause he wanted more commissions. Spiffy didn’t like our conservative investments Ms Smith, so he decided to go somewhere where he could offer non conservative investments. I can see it now…Spiff will be on here bitchin about Weddle bad mouthing him to HIS clients…ha…what a thought. What comes around, goes around.
[quote=Spaceman Spiff] Why? That’s the big question. Why would EDJ want to sell out to anyone? Talk about a mass exodus. The day Jones announces that they’re selling out to some big bank somewhere is going to be LPL and RayJay’s biggest days ever. The one thing us cult members won’t stomach is some outsider pushing our buttons. It would be the worst mistake a purchasing firm could make. I can see it now…“Sure that’s a fair price for 10,000 FAs…wait, 8,000…hold on, 7,000…well crap, that’s not a good price at all.”
Of course you’re saying, but that what the guys at AGE said too. We’re not for sale. Unless you are a publicly traded company who’s shares were being purchased by a rival bank/brokerage firm and you were about to become a part of a hostile takeover. Better to fall on your own sword than to be sliced and diced by someone else.
Exactly what writing is on the wall? [/quote]
What if Jones sold TO LPL or RayJay? Those would be the most likely suitors. Think about it. Who feeds the most advisors to LPL? The ole’ Green Recruiting Machine. It’s Like LPL’s own HR department. There is no other B/D that would even consider it (no other captive B/D anyway - possibly other indy B/D’s would, but most aren’t big enough to acquire Jones. Maybe an insurance company). The only other option would be that Jones goes public. But to be honest, I’m not sure what that would do for them, other than make the GP’s and LP’s filthy rich. It would not really solve anything for the growth of the firm. They have sufficient capital resources to help grow the firm right now - it’s more a matter of HOW they want to grow. Once they can increase retention, they can increase growth and profitability. My guess - nothing is changing with ownership in the next 10 years.
Hello people. The writing is on the wall. Jones is going to be “with” somebody. Unfortunately the seller has to lie about selling or the sale will never happen. Company:“Hey Mr broker, come and work for us, and by the way we are selling out.” Broker:“Sounds great! Where do I sign up? I’ve always wanted to work for a company thats selling to another. Can you tell me what companies are interested so I can research them?”
Name one legitimate reason (other than to just bash Jones) that Jones will be selling. Just one.
Ineffecient capital business model
Wrong. You may be right that it is an inefficient capital business model. But that is a weakness of Jones, NOT a reason that someone would buy them. In fact, that is THE primary reason that Jones will NOT be acquired. Nobody wants to unwind 12,000 leases or take on the burden of re-assigning all of them to branch offices and risking the massive exodus of brokers at that point. And the model doesn’t fit any other firm other than indy B/D’s. I actually think Jones uses that portion of the business model to deflect suitors. The ONLY way it would work is if someone bought them with the udnerstanding that they may retain like 50% of the assets, and just try to absorb them into existing branches.
I’m, not defending anything about Jones’s business model. I am just stating that it is not a very attractive business to buy.
I’m sorry, I thought the question was why would Jones be selling, not why would anyone buy them. And thank you for confirming it. There is your one reason.
No one is stupid enough to acquire jones. The only way they sell out is an IPO. And if they ever do that will be the first stock I ever short.
Well, since Jones is highly profitable for the current owners, I don't know why an "inefficient capital business model" would be reason for them to sell. You consider selling when your business is in great demand from other companies, or you are on the brink of collapse - neither of which is happening right now. So I guess I am still confused.I’m sorry, I thought the question was why would Jones be selling, not why would anyone buy them. And thank you for confirming it. There is your one reason.
Again, not defending Jones. I just don't see the argument for selling (other than to go public).
If Jones were concerned about the inefficient business model, which they aren't, they wouldn't sell out or go public to fix it. That wouldn't fix a fundamental business model. If it became so much of a concern that they wanted to fix it, they would simply develop a plan to do so. For instance, they could fairly quickly move to a multi FA office system. How many small towns out there have 2 or 3 FAs that could easily share one office, one assistant (who could get paid well to serve those FAs), one set of equipment, etc. If they could just cut the cost of rent by 1/3, they'd save a ton of money. But, the GP's would make more money, so there's one more thing for you guys to complain about. That's just one example. I'm sure the brilliant minds on this forum can tell Jones how to run a more efficient business.
Well, since Jones is highly profitable for the current owners, I don't know why an "inefficient capital business model" would be reason for them to sell. You consider selling when your business is in great demand from other companies, or you are on the brink of collapse - neither of which is happening right now. So I guess I am still confused.[quote=Bluetang]I’m sorry, I thought the question was why would Jones be selling, not why would anyone buy them. And thank you for confirming it. There is your one reason.
Again, not defending Jones. I just don't see the argument for selling (other than to go public).[/quote] I'm confused also. First you asked why would Jones sell? I gave you an answer to which you agreed, but said why would anyone buy? Then you said my answer was wrong. Which is it. As far as being HIGHLY profitable, Jones is not. GP's individually make a VERY good living, I am not denying that. But compared to other B/D's profit margin is slim. Another reason to sell, margins in the brokerage business are becoming increasingly tight. Do you honestly believe that Jones is rolling out a wrap program because they have seen the light? No way in hell. They are doing this to increase revenue in light of the hit they took on RS. Another hypocrisy, but we can discuss that elsewhere. They are bringing in wraps because they see the writing on the wall. This is the plan that Spiff mentioned they would institute when their business model started failing. Spiff was also nice enough to mention why someone would buy them and how it would not be easy, but not impossible to consolidate offices for cost effectiveness. Massive defections probably would not occur. Same thing was said about AGE, yet only 10% of brokers and more importantly 2% of assets have left almost a year out. We teach our clients to sell high, Jones may at some point (not saying today) realize that they have maxed out and time to sell.
Whenever you wrap your clients in fees the value of your business goes up. Are they doing this b/c this is what the client needs? I doubt if any Jones folks have their money wrapped. They are feeing this and feeing that, raising quotas, etc. Something is going on folks. Maybe the plan was to downplay the lawsuits like they are no big deal and increase fees slowly and blame it on a hit me all at once inflation adjustment. Just come out and say the lawsuits hurt and take it like a man. How many more million would the suits need to be before you say “damn that hurt.” But, then again maybe they are landscaping their offices for something bigger in the future like a sell. Its one or the other for sure. We’ll see.
Gentlemen (I assume you are not ladies…),
I am not defending Jones. I am looking at it from their perspective. Yes, they do not have the highest profit margins in the industry. BUT, they don’t have to spread that profit over as many owners as most public companies (i.e. Merrill, Citi, etc.). GP’s have been getting 60%+ returns, and LP’s 20%+ returns for decades. And it has been extremely consistent because they basically only do brokerage. If they went public, all of the owners would have a HUGE onetime payday. But after that, I doubt the firm would be as profitable for the “new” shareholders (due to dillution).
You are correct, nobody (well, not me anyway) is under the false impression that the wrap program is for the clients. It may be to give the client more options (which leads to capturing more clients), but at the end of the day, Jones saw the writing on the wall that the entire industry has shifted this way, and that their long-term business model is flawed because their revenue sources are very narrowly focused (A share commissions and revenue sharing…from A share MF’s). I don’t think it is “hypocritical” when a company OPENLY acknowledges that their business model is flawed (our 5 year business plan STATES it). There has been a change of management, and that new team is attempting to correct some of their potentially fatal flaws. But I highly doubt they are somehow setting themselves up for a sale. It is simply to become more profitable (and the last time I checked, that was the goal of ALL for-profit companies). They will surely cloak some of their changes as being “for the best interest of the clients”, but don’t all companies do that? Frankly, I am impressed that they have openly stated all of their flaws in their business plan, for all to see.
And I am not so sure they will “max out” and decide to sell. Sometimes just earning a consistently high rate of return year after year is enough, without going for that onetime BPD (big payday).
Now, I may be proven wildly wrong at some point. Who knows. I am just a little cog in a giant wheel. But that is just how I read theings from my perspective.
The hypocrisy is telling brokers (and therefore clients) that wrap programs were a money grab for firms and brokers and not the ethical Jones way of doing business. Wrap programs are not for every situation, but there are many instances where a wrap program makes sense. For years Jones said in NO cases was a wrap program appropriate as it was not the cheapest way to invest. Now that RS has been severly limited, they are going to introduce wraps. Hypocrisy is doing one thing when it benefits you, and then doing another when it suits you.
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