Licensees should expand platform offerings on their approved product lists (APL) in order to expand and retain adviser numbers, Pinnacle Practice director Anne Fuchs said yesterday.
Demand for more platform choice was strongest among younger advisers who were not entrenched in a dealer group culture, Fuchs said.
"[Younger advisers] have many years ahead of them as professional advisers and are not interested in making money out of product," she said.
"Their value offering is about the delivery of advice and therefore they want to be able to use the products that are most appropriate for their clients' needs."
Pressures arising from the Future of Financial Advice (FOFA) reforms and difficult market conditions can also be attributed to the increase in demand.
However, some institutional licensees appeared to be shrinking their APLs, citing the FOFA best interest duty as the cause, and some non-institutional licensees were following their lead, she said.
She said through Pinnacle Practice's dealer group offering, My Dealer Group, the company was referring advisers to only one institutional licensee, which gave advisers the flexibility they were looking for.
There was also a trend for smaller groups of advisers to band together to form cooperative licensee businesses, she said.
"These co-ops want to establish a sustainable and reasonably profitable non-institutional model that allows advisers to run their businesses the way they want to," she said.
"If they shrink their APL, it is inevitable that some of them are going to leave because it doesn't sit well with their business model."
She said without wider product offerings, licensees needed to scale their offerings so they could meet the needs of people who were happy to have a restricted APL.
