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Successful brokers are constantly looking at ways to grow their business and to offer their clients better financial services
THE MORTGAGE industry in 2011 is, I believe, in great shape and is well positioned for growth. There are probably many who disagree with this view, but it is important to realise that while there are some elements affecting the industry that we can’t control, there are many more elements that we can control.
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Therefore, it is within our power to determine the direction of the industry going forward.
Growth in credit and property is still slow, and while the cost and availability of funding remain a challenge for banks and non-banks alike, the new NCCP regulations are certain to be a catalyst for evolution in the industry. The regulations will challenge a number of the industry’s paradigms.
Brokers who understand the critical importance of client relationships will continue to grow since relationships are core to diversification, cross selling and the building of a sustainable, long-term business.
It might be becoming increasingly difficult to predict the long-term future of the industry, but we can confidently anticipate 2011 will pan out as:
A year in which brokers consolidate and review their approach and process in engaging with clients – being transaction- and product-focused is no longer enough to be successful.
A year in which giving advice is now an “official” requirement and brokers will have no choice but to do more. This will lead to an increasing number of brokers introducing a fee for advice – after all, a professional’s time costs money!
A year in which diversification is taken more seriously. Creating alternative revenue streams is essential to improve profitability and to counter the lower commissions being paid.
A year in which branded broker businesses become more relevant.
A year in which brokers need to increase their marketing efforts in order to survive.
A year in which we will experience a significant increase in relevance and competition from non-banks.
A year of further consolidation among broker groups, but also a year of innovation and new players.
A year in which the broker industry will finally be recognised as a professional industry.
Despite all the efforts, discussions and good intentions over the years, very few broker businesses have been successful in their marketing efforts and they have been unable to construct a successful brand within their local areas.
Success is largely built on the broker’s name and the good service they provide, which naturally results in referrals.
Brokers who continue to succeed and grow will be those who seek ways to evolve and create more value in their business by following up with their customers, anticipating their future needs and meeting those needs by offering a broader range of financial services.
By Brendan O'Donnell, Managing director, BEAT Home Loans
