Wholesalers Left To Fend for Themselves

Such tools include customer and competitor intelligence, training in business management, and compensation that aligns with profitability objectives. In short, most asset managers rely almost entirely on the wholesaler’s experience and judgment to manage the firm’s pursuit of profitable business opportunities, kasina says in its report, “Excellence in Distribution: External Wholesaling.”

“Smart territory management is the foundation of profitability for an asset manager,” says Lee Kowarski, a principal and co-founder of kasina. “Without rigorous territory management, including customer segmentation, account planning and rewards aligned with profitability goals, firms have little control over whether wholesalers are spending the right amount of time on the right activities with the right customers.”

The field wholesaler’s primary responsibility is to build business with advisers, says kasina. To be successful requires a keen understanding of what advisers want, in relation to the firm’s profitability objectives. “In-person meetings correlate strongly with advocacy—the adviser’s willingness to recommend a firm’s products. Advocacy leads to increased business.” says Kowarski. “[W]ell over half of advisers who are advocates of a firm plan to increase their business with that firm, compared to 24% of advisers who are not advocates.”

Wholesalers have the highest costs associated with sales but also can have enormous impact on advocacy of the firm and resulting business, the report contends. Thus wholesalers should be focused on the business development opportunities with the greatest long-term potential for the firm.

kasina used data from a 34-question survey and interviews with executives from 28 firms. The report details best practices and recommendations for optimizing territories, organizing resources, staffing and training effectively, and aligning metrics and compensation with profitability goals. For more information about the full report, visit www.kasina.com/reports.