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Financial Services Firm Affiliation American Express, a Case Study Aug. 7, 2000 (SmartPros) The argument has continued for years. "To affiliate, or not to affiliate?" has become the looming question for many of the most impressive financial services companies in today's marketplace. Today, as market share is king and everyone fights for a bigger piece of the pie, the leaders in the industry are doing what they can to stay atop of the ever-increasing litany of firms involved in day-to-day financial matters. Whether financial planners and advisers stay independent or choose to affiliate, the choices are greater today than ever before--and these choices offer options that can truly help you to build your practice.
As an example, American Express Financial Advisors has devised a new program that's making news because of its various options. A longtime leader in trends affecting the industry, AMEX has come to represent a standard associated with customer service and name-brand recognition few other firms can match--other than perhaps some of Wall Street's most influential concerns.
In an attempt to double its base of financial advisers by 2008 to approximately 20,000, the company has just rolled out a new, three-part plan designed to put the "flex" in flexibility. Three different career tracks are offered, as well as the first franchise opportunity ever offered by a financial services company.
AMEX already has test-marketed this program in Washington, D.C.; Baltimore; Illinois and Kentucky with an impressive gain of about 30 percent in recruiting since August 1999.
Three Career Tracks
According to company collateral, the three career tracks include the following.
Marketplace Options
Financial planners have options other than AMEX, of course. They could:
What are the advantages of each option? Plenty, depending on your own situation. If you are independent and working in the financial planning business on a full-time basis, you may want to slow down a bit by affiliating with a large firm to help manage the ins and outs of building your practice.
At the same time, some practitioners may want to branch out and seek franchise opportunities because they believe this is where the real money is--or is going to be.
Selling Out Could be Negative
If you're an accountant or financial planner with an established practice, you may be frowned-upon by your peers should you decide to affiliate with a large firm like AMEX because you've given the impression that you've "sold out." Several years ago, when Stuart Kessler, then chairman of the American Institute of CPAs, sold his firm of Goldstein Golub Kessler & Company to AMEX, a battle--both pro and con--waged in the halls of the country's most respected financial services firms. Kessler contended that he was justified in making the move because it benefited his firm for the long haul--it was not just a sell-out with short-term vision and short-term gains. At the same time, he came under attack from his peers because they did understand how a once-independent accounting firm could change colors and affiliate itself with a large animal like AMEX.
Regardless of how those working in the financial services industry feel about it, however, Kessler's firm is an example of a trend. Whatever their reasons are, many firms like Kessler's are opting for the freedom associated with affiliations like AMEX. The options are numerous and up to the individual. There's never been better time to build a practice.
Please send your comments, questions and article proposals to information@smartpros.com.
For more information on American Express financial services, visit the company's Web site at www.americanexpress.com/advisors or call 800.386.2042. |
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