Failing

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Jul 25, 2006 9:57 pm

Why do most new advisors fail in this industry? Is it because of a lack of work ethic? Does the new advisor in the industry control their own fate or is it sometimes out of their control?

Jul 25, 2006 9:59 pm

I believe that it is a combination of hard work, good luck, and a strong natural market in the beginning.  After that, your work speaks for itself.

Jul 25, 2006 10:21 pm

I think it is because most people won't trust a 23 year old with their life savings. I think if most people started as an asst. or worked for a mutual fund company and entered the business around 30 or so success rates would be way higher.

Jul 26, 2006 12:35 pm
bankrep1:

I think it is because most people won't trust a 23 year old with their life savings. I think if most people started as an asst. or worked for a mutual fund company and entered the business around 30 or so success rates would be way higher.



YOU ARE COMPLETELY RIGHT

Jul 26, 2006 1:12 pm

Most new hires fail because they are lured to the industry by the glamor and money that many brokers are making.They leave because they should either be on an appointment, or setting one, and instead focus on researching and everything else but talking to prospects. Too much training is on products and not prospecting, leading to a failure to focus.


20 somethings should focus on mutual funds and the longevity of the firm and fund managers experience, not why they believe xyz stock is going to go from 10 to 30.


90% of this business is in your head, most new hires aren't around long enough to realize that.


Just my ramblings,


Stok

Jul 26, 2006 1:55 pm

Simple answer:


1 in 10  new businesses fail across the board no matter what industry you're in.  Brokers are no exception.

Jul 27, 2006 8:17 pm
stokwiz:

Too much training is on products and not prospecting, leading to a failure to focus.



I couldn't disagree more. Firms focus too much on teaching you ABSOLUTELY USELESS prospecting tactics that DON'T WORK. The vast majority of trainees are given the title of "Financial Advisor" when they are completely untrained to perform the task.


No, I repeat; No sales trainer is going to teach you how to get clients. If they knew, they'd be a successful financial advisor. Even a successful financial advisor can't tell you how to get clients, only how THEY did it. Only YOU can figure out how to get clients.


This is, in my humble opinion, the best job in the world and is certainly better than being some crappy Zig Ziegler (sp?) type - traveling around the southwest and staying in various airport Ramada Inns and the like. Sales trainers are failed salespeople. They don't know; cause they didn't succeed. That's why they do sales training thing. It's the EASIEST thing to sell.


Everyone wants to think that ANYONE can do this business. That's simply not true - its a rare combination of salesmanship, intelligence, discipline and ability to build networks that drives success. It's a very hard business to break into, but it's not 'too much education' that's the culprit.


Most rookies are so inexperienced and green that any prospects that are smart, educated and wealthy enough to matter will immediately identify their limited knowledge by cursory discussion - particularly if they have 20 years on you...


Unfortunately, this job is now about both (1) pounding the pavement (intelligently) and (2) intensive education. Both are equally important. Expect to work 80 hours a week your first few years in this brave, new world. Expect to need to know a lot about investments, business math, retirement plans and much, much more to succeed.


In the end, I think that good salesmen develop their skills long before they are even old enough to shave. Training won't teach empathy and insight into the human motivations. 


The only "coaching" that is useful is essentially management consulting: it teaches you how to do this job.

Jul 27, 2006 8:38 pm

Great post SFB.  What are the best suggestions for people preparing for this career to do before they get the green light to sell?  (Other than pass the exams.)

Jul 27, 2006 9:08 pm

solid post san fran.

Jul 27, 2006 9:16 pm
opie:

Great post SFB.  What are the best suggestions for people preparing for this career to do before they get the green light to sell?  (Other than pass the exams.)


Get on the phone and raise money for your favorite charity.  "Mr. Johnson, my name is Nathen Newbroker and I am calling today to ask you to make a contribution to The American Heart Association......"


This will develop a certain amount of comfort dealing with getting decision makers on the phone--and do good too.

Jul 27, 2006 11:53 pm
opie:

Great post SFB.  What are the best suggestions for people preparing for this career to do before they get the green light to sell?  (Other than pass the exams.)


My thinking is that one should have at least a few years of experience in the industry. Ideally as an SA or wholesaler. The best kind of education for this job is the CFP. I don't have one, but I took a review course recently for it (I plan to eventually challenge the exam) and I was very impressed by the curriculum.


Some degree of involvement in their local charities I would say. Fundraising would be an excellent activity, as another poster indicated.


I would say that someone should have the level of knowledge that the CFP equates before they can reasonably argue that they are giving educated advice. The material could easily be completed from scratch. I think that Kaplan has a course.

Jul 28, 2006 9:11 am

SFB - your passion is wonderful!  I would also add that most new people fail because they expect someone else to tell them what to do everyday.  They blame the training, the market, their family, the economy, politics, war, oil prices, hot weather, cold weather, summertime slow down, poor branch management, poor brand awareness of their firm, poor marketing departments, bad lists, no not call registery, decaf coffee, etc.  However, they leave the most important factor out of the equation - they don't look at themselves.


80 hours per week - it would be hard to lose.

Jul 28, 2006 11:37 am

I think most people "fail" because they can't get through the initial 3 or 4 years of paying the rent with a credit card.

Jul 28, 2006 12:18 pm

Correction:  All I said above, plus a healthy bank account!

Jul 28, 2006 5:28 pm

A big part of the problem is the low barriers to entry.  There are no specific education or experience requirements for this field, just a handful of fairly easy exams to pass.  So the industry is flooded by mostly unqualified people that see the easy and lucrative life of a veteran.  What they don't see is the very difficult and low paying life of a rookie.


I would agree with the others that the best way to enter this field, particularly if you are young and/or inexperienced in sales, is through the backdoor.  Be a wholesaler, an assistant, work at a bank, or do some other job where you can learn the ropes and get your CFP, then jump into it.

Jul 28, 2006 6:00 pm

Stokwiz,


You are absolutely correct. The most successful in my office are the ones who are always on the phone and meeting with clients. Seems like all our training is on products and not enough on presentations and smart prospecting. It's funny how these posts start off with a simple question and evolve into something totally off topic.

Jul 30, 2006 1:45 am

People fail because most of what financial institutions teach is wrong.  They teach you from day 1 to postion yourself as a sales person by chsing people with YOUR agenda (e.g. send product literature).  But people run from sales people and thay are not interested in your agenda.  Firms never teach you to position yourself as a professional because they teach only what the lowest common denominator--the dumbest guy, can learn. This business does not require talent--it requires the religious following of systems and methods that are proven to work.  Unfortunately, firms dont teach this.  For what its worth, I teach about this on a teleconference.  This is not a plug--I dont care if you attend or now.  It's for you if you want it www.nfcom.com/register.  I also recommend you find a very successful mentor and be his/her lacky for one to two years and then just copy what they do.  You learn the best lessons from those people already successful.  I mentored one guy and he is now branch manager at another firm and was a star in his class.

Jul 30, 2006 6:54 am

Kleino- Another shameless self promotion.


Of course people run from salespeople; most aren't interested in your agenda; and guess what- most people aren't even qualified to make a significant investment with you as they lack the means.  That is why it's called a numbers' game.  Talk to 100 people and (eventually) one of them will open a qualified new account.  That is how you survive; you then work on generating referrals, gathering additional assets, etc to really prosper.


I imagine you are pushing a seminar program.  People "run" from seminars as well as they don't want to be subjected to a pitch (or a pitch diguised as a "topic") and be surrounded by strangers.  And the cost is very prohibitive.  The best seminars are client seminars where they bring a friend.  Or if you are able to show up at a company and "lecture" their employees.

Jul 30, 2006 10:55 am

[quote=kleino]This business does not require talent--it requires the religious following of systems and methods that are proven to work.  Unfortunately, firms dont teach this.  For what its worth, I teach about this on a teleconference.  This is not a plug--I dont care if you attend or now.  It's for you if you want it www.nfcom.com/register.  QUOTE]


Oh yeah, you can go the route of hard work, education and entrepreneurship... or you can go with this guy's get rich quick scheme.


I'm sure you'll get rich... and quick!

Jul 30, 2006 10:56 am
kleino:

I mentored one guy and he is now branch manager at another firm and was a star in his class.


Wow... a branch manager!