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Outsourcing back-end processes could be the answer for brokers looking to save time – and money
It’s a challenging market right now, and with the obvious need for brokers to focus on core activities such as marketing and prospecting new clients, a growing number are realising that some of the peripheral day-to-day functions may be better dealt with by someone else.
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One such strategy that is currently gaining momentum is the outsourcing of back-end processes to specialist service providers.
Monique brand, the director of back-end processing service provider LoanTrack, says brokers are able to outsource all home loan processes from enquiry stage through to settlement, freeing them up to concentrate on business building.
“Our service assists and complements brokers' businesses so that they can focus on sales and increase volumes and revenue as a result,” she says.
Time well spent
Jeanette Middlemist of brokerage Rockfeather in Victoria is a strong advocate of outsourcing. She says it has tripled the amount of time she has been able to devote to generating and developing more business – a win-win situation.
“I spend time on administration, marketing, research, providing ongoing service to existing clients as well as sales and building business with new clients,” she says.
“Being on hold to the banks and chasing documents is not an effective use of my time.”
Indeed, with commission cuts reducing the average broker’s income by around 30 per cent, more brokers are recognising the importance of managing their time effectively to increase productivity.
“With commission cuts brokers need to find new ways to be profitable and stay in the game,” says Brendan Ansell of velocity finance in Queensland.
Mr Ansell says outsourcing saves him two key resources – time and money – “and everyone wants to save on those”.
For Mr Ansell the decision to outsource some of his business functions was originally a short-term solution to a shortage of suitable staff. It worked out so well, it has become a permanent arrangement.
“I just couldn’t find anyone experienced enough to do the job well," he says.
“When I did have my own staff I was always wasting time and money checking up on things. Now I can be confident my [outsourced] provider’s staff work hard and know exactly what they’re doing, leaving me with time for more important tasks such as visiting clients.”
Ms brand says outsourcing is an attractive option for brokers who are also looking for flexibility to match their business cycles.
“by outsourcing brokers have the option of using services during times of high volume but retaining their files in-house during quieter periods,” explains ms brand.
Mr Ansell says for a small business this is very appealing. “if you spend, say, $4,000 a month on wages and you don’t write any business during the first two weeks of January you’ve already saved yourself $2,000 for the year,” he says.
“managing employees also takes a lot of time and effort – there are wages, super, training... By outsourcing i don’t have to worry about any of that, it’s just a simple invoice at the end of every month.”
Improved service
In freeing up brokers’ time to concentrate on business strategy and development, outsourcing can also help improve the quality of a broker's relationship with their clients.
Ms Middlemist says her relationships have improved because she has more “warm fuzzy” conversations with clients and less of the “frustrating follow up conversations for missing paperwork”.
“Outsourcing has helped define my role as the professional expert,” she says.
Ms Brand says outsourcing also aids brokers who struggle to maintain service levels once they’ve sealed the deal.
“historically, brokers have been great sales people but tended to lack the consistency required in maintaining the service levels once an application has been submitted," she says.
“We generate repeat business for our broking clients due to the high level of service the client receives from the broker’s “PA” – who picks up the slack.”
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Outsourcing at a glance
