3 Ways to Grow Your 401k Business
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Today I want to share with you 3 ways to grow your 401k business.
Now in any industry, there are a few ways that you can do this. And it’s pretty much the same, whether you’re selling financial planning, widgets investments, books consulting, and these ways are 1) get more customers 2) increase your prices or 3) add more products and services to your offering.
1 – Increase # of Customers
Let’s look at the first one – growing the number of clients you service.
So if you can easily service 150 financial planning clients right now, and you want to grow your business, you can increase the number of customers to 200 or 250. That’s going to bring in more revenue and that’ll help grow your business and increase your bottom line.
Getting new customers though isn’t always that easy. It requires a very strategic marketing plan, which is why I highly recommend you read the previous article posted on How to Plan (and Hit) Your 401k Busines Goals, where we talk about planning for the different goals that you might have for your business and how to actually create action steps that are going to help you reach those.
2 – Increase Your Fees
The second thing is to increase your fees (charge more for the services you offer).
Now, maybe, you know exactly where your fees comes in in line to your competitors. Maybe you don’t, if you haven’t benchmarked your own consultant fees, I highly recommend that you do that. A couple of providers that offer consultant fee benchmarking data include:
- Fiduciary Decisions (advisor fee benchmarking resource)
- Fi360 (a Broadridge Company) (advisor fee benchmarking resource)
So increasing your fees is one way that you can grow your business. Hopefully you’re not part of the race to the bottom when it comes to fees and you’re not underpricing yourself just to win business, but I would highly recommend that you look at your fees and understand what your competition is charging so that you can understand where there might be room for you to modify your fee structure.
3 – Offer Additional Products and Services
The third thing is to increase the number of products that you offer.
An example for this in the financial industry is if you’re not regularly talking about life insurance or any type of insurance with your clients, that’s something that you might want to include in the conversation.
Looking back on my Edward Jones days, it seems to me like insurance was and actually a pretty easy sell. And the commissions were actually pretty good as well. So insurance is an example of adding and offering to your product line.
If you’re already doing that, another thing you might want to consider doing (and I wrote about this in a blog post called the Growth Path vs the Guru Path), is packaging up your knowledge and selling it. Maybe it’s offering a budgeting course, or a book, or it’s offering live or digital courses specifically for plan sponsors that you charge a fee for (think fiduciary training).
There are a lot of ways that you could package up your knowledge and your time and add it as a different type of a product or service to your offering (if your firm and broker dealer allows it).
How Will You Grow Your Business?
I hope that this information helps as you consider whether you have the resources to take on new business, increase your number of clients, or whether increasing your product line makes the most sense.