Switching to bespoke investment services boosted adviser profitability, according to a survey from Rathbones Group.
Almost all advisers surveyed (95%) said their company’s overall profitability improved after the switch, while 97% said they could take on more clients.
All advisers questioned said clients were generally happy when offered a bespoke service, with 35% saying most clients were very happy.
Rathbones study also found that advisers were nearly split on whether it was difficult to introduce a third-party investment manager service into their business.
Just over half (51%) said it was not difficult, while 48% said it was.
Beyond profitability, 85% of advisers said their relationship with clients improved after bringing in a third-party service, and 24% said it had become much stronger.
The number of meetings with clients increased on average for 85% of advisers, with 19% reporting a dramatic rise.
Additionally data showed around nine out of 10 (89%) said the risk/return profile of clients’ portfolios improved after switching to third party services, with 29% reporting a dramatic improvement.
Simon Taylor, head of strategic partnerships and platforms at Rathbones, said: “Moving clients to a bespoke investment service needs to be carefully considered by advisers, with a wide range of factors to look at.
“The advantages of making the switch are, however, clear from the research, with clients benefiting in terms of improved relationships, and advisers seeing increases in profitability and being able to take on more clients.
“We only expect the demand for advice to increase, as more clients move towards and into retirement.”
Taylor added: “This strengthens the need for adviser firms to build partnerships with discretionary fund management firms.”
