Providing a Safety Net


Benefits of Transitioning from a Small Broker-Dealer to a Super OSJ

Independence Without the Burden

08 Mar 2017
Independence Without the Burden

In recent years, more and more entrepreneurial financial professionals from wirehouses and captive insurance companies have been opting to go independent to gain greater flexibility in how they serve their clients. With recent regulation that has put potential conflicts of interest related to proprietary products in the spotlight, that trend is expected to continue.

Making the decision to leave even easier, many wirehouse and insurance-based financial professionals are discovering they don’t have to completely give up the structure they’ve become accustomed to. By joining an existing branch, they can enjoy the freedom of independence along with the support of experienced supervision, compliance and practice management professionals. 

“Branch models definitely benefit everyone, even when each financial professional has a different business model,” said Todd Terhorst, branch manager for Diversified Wealth in St. Louis Park, Minnesota. “Financial professionals can share their unique business styles and product knowledge and receive feedback on their choices. There are common support systems in place including staff, software and systems. I don’t know too many people in this business who are really a one-person shop. There’s value in being part of a group while still being a maverick and doing your own thing.”


Branches can provide a balance of FLEXIBILITY and SUPPORT.


Two Layers of Service

Financial professionals in branch offices benefit from the added security of being backed by two levels of service and support — one from the branch and another from the broker-dealer.

“When you join an existing branch office, you get the best of both worlds,” said Gregg Johnson, Securities America’s executive vice president of Branch Office Development and acquisition. “You have the values of independence in strategy and in product choice, the support of an experienced branch and successful peers and the extensive resources offered by the broker-dealer.”

Branches provide administrative services, supervision oversight and best practice solutions to their financial professionals. In addition, branch managers often work closely with skilled professionals at the broker-dealer level so they can pass on information about new products, technology and training.

Size and scale are important when deciding on the perfect branch and its broker-dealer counterpart. It’s important to partner with a firm that is large enough to provide leading products, services and technology, but small enough to give personalized support and maintenance.

To get the most support from joining an existing branch office, look for one with top producers and a professional, non-producing management team with the responsibility of running the day-to-day business and supporting financial professionals. This model couples the benefits of peer-level mentoring and coaching with experienced business management.


Build Brand Prestige

In the independent environment, financial professionals rely on their unique brand to attract and retain clients. Moving from a solo practice to a branch office can help reinforce your brand, when marketed as a new partnership, or build your brand into the existing branch, adding credibility to the financial professionals as being trustworthy and collaborative.

“It’s a common misconception that it is difficult to grow a business without a major brand backing you up,” Johnson said. “The fact is, most clients don’t care about a known-brand parent company. They are looking for a knowledgeable financial professional with whom they can build a long-term relationship based on trust. Independent financial professionals are able to further that relationship by putting their clients’ need before their broker-dealer’s needs.”


The Flexibility to Choose

Independent financial professionals can structure their work lifestyle to complement rather than overpower their personal lifestyle. They have the flexibility to choose the type of people and support staff with whom they want to work and can structure their office hours and workdays to accommodate their needs and the needs of their clients.

Most successful branch offices allow financial professionals seeking greater independence with maximum flexibility the opportunity to create a personalized business model that works best for them and their client.

Choosing to be an independent financial professional means you can supply your clients with optimum product selection and a vast array of services. It also means taking on more responsibility. But as financial professionals opting to join a branch are discovering, you don’t have to do it all yourself. With the support of a team at an established branch office, you can tap into resources and benefits you might not have had otherwise.

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