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Jessica Darnbrough
Diversification is likely to become increasingly important in 2012, with one industry stakeholder claiming brokers who fail to diversify in the New Year will be left behind.
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Speaking to The Adviser, Stephenson Mansell Group chairman and former chief executive of Mortgage Choice Paul Lahiff said more and more borrowers will expect their broker to meet all of their financial needs.
"Brokers need to understand that their borrowers are going to come to them for all sorts of financial advice and if they can't provide them with that, then they are letting their clients and themselves down," he said.
Mr Lahiff said all brokers will be forced to diversify their core business offering in one way or another.
"Some brokers will try to be all things to all people, and give advice across a broad range of products. Others will have a series of people working within their office that they can pass other finance opportunities onto, while some will have close relationships with other financial professionals," he said.
"Whatever way they diversify, I think the one thing that all brokers will realise is that they are in a position of trust and need to be able to meet all of their clients' financial needs.
"It may not happen overnight, but eventually brokers will have to diversify."
But while Mr Lahiff believes it will take some time for all brokers to diversify their core offering, data suggests many are already broadening their revenue streams.
According to a recent The Adviser straw poll, 56.4 per cent of brokers added an additional revenue stream to their business in 2011.
Of the 211 respondents, 43.6 per cent said they had not broadened their business offering in the last 12 months.
