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How brokers could form referral partnerships with advisers

By Malavika Santhebennur
4 minute read

A mortgage brokerage has pushed brokers to target specific markets when forming referral partnerships with financial advisers.

Finni Mortgages’ CEO Paul Glossop said forming strong referral partnerships with financial advisers requires time and energy but not necessarily the same amount of capital as a marketing strategy.

Mr Glossop spoke to Investor Daily ahead of the New Broker Academy 2022 (hosted by Investor Daily’s sister publication The Adviser), where he will present a session on the significant impacts of strong referral partnerships on brokerages, and the strategies brokers could implement to connect with financial advisers and wealth managers, while avoiding common mistakes when establishing and growing the partnerships.

He underscored that referral partnerships are a “two-way street”, and as such, urged brokers to give in order to receive, and find partners who appreciate the value of their service offering and skills.

“For me, it’s a way to build a business and your reputation as long as it’s done correctly,” he told Investor Daily.

However, to form fruitful referral partnerships with financial advisers, brokers must understand their core business and service offerings and have a targeted approach to finding referrals, Mr Glossop pointed out.

For example, if a broker services first home buyers (FHB), self-managed superannuation fund (SMSF) trustees investing in property, upsizers, or downsizers, they could approach a financial adviser who targets similar clients and inform them that they have accreditation and experience in those areas, he suggested.

“When you target financial advisers who align with the kinds of services you offer or specialise in the same area as you like SMSFs for example, you can tell them that you have the ability to maximise their clients’ outcomes and experience with the financial adviser,” he said.

“If you as a broker work specifically in investment property or refinance, you can target financial advisers who only include property investment as part of their wealth creation plans for their clients.

“Start with knowing who your key clients are and what your avatar is, and then explore which financial advisers or other referral partners are going to suit you.”

However, specialising in a market that is excessively niche or specific (like the medical or legal field) is not ideal, Mr Glossop said.

“There’s a really good market there but as you can imagine, it’s a very small pool of prospective clients,” he said.

Demonstrating your value to clients

To attract financial advisers, brokers could demonstrate how they have improved their client’s financial position and assisted them with their property purchases.

While this could pose a challenge for new brokers, Mr Glossop encouraged them to be ambitious and flexible around how they network with potential referral partners.

“This could include cold calling and setting up meetings, and being comfortable with catching up when it suits the referral partner, including before or after hours or weekends,” he said.

In addition, face-to-face networking referral groups could be an effective launching pad for new brokers.

“I’ve found through my experience that they are typically a longer burn but a really good starting point because they refine your ability to pitch your service to new people,” Mr Glossop said.

“A key part of being able to figure out whether your messaging is effective is explaining it in 30 seconds to a potential referral partner what you do and how you would help out.”

Be comfortable with failing

Most importantly, Mr Glossop encouraged new brokers to accept “failing multiple times over” when striving to grow their lodgement and settlement volumes.

He concluded: “You do get promised the world in the broking space but if you're going to drum up referrals and leads yourself, be comfortable knowing that it typically takes three to five years for the average successful broker to really get to that tipping point where they get enough leads and referral volume generations to make a good business out of what is normally a fledgling business.

“I’d suggest that you don’t spend your money on things that you don't need. Be tight with it and be comfortable spending 70 to 90 hours a week in front of people. You have to do that consistently for up to three years before you really start to see some strong dividends.”

To hear more from Paul Glossop about how to build your referral partner pipeline with financial advisers, come along to this year’s New Broker Academy, hosted by The Adviser.

The New Broker Academy 2022 will take place in the following locations:

  • 6 September: Rydges South Bank, Brisbane, Queensland
  • 8 September: Montage, Sydney, NSW
  • 13 September: Crown Melbourne, Victoria

Places for this free event are limited so book your seat now by registering here.

For more information about the New Broker Academy, including agenda and speakers, click here.

Paul Glossop created Finni to share his secret to successful financing with other investors. Contact Paul today to find out how we can help you get the most out of your investment or for your clients investments.