The planning industry is set to go the way of the real estate and telco sectors, with consolidation of power by the major dealers at the expense of independent advice, predicts Strategic Consulting & Training’s Jim Stackpool.
“The whole dealer issue is becoming more commoditised,” Stackpool told ifa. “It’s going to become like Vodafone, Optus and Telstra; like Boeing and Airbus; or like the real estate sector where you have LJ Hooker, Ray White, Richardson & Wrench all really battling for diversification.”
The comprehensive service list offered by dealer groups – running from client management to social media training and personal indemnity insurance – is increasingly becoming a “white-label” for affiliated advisors, he said.
He predicted the next “evolution” in the industry will see more and more advisory practices tying up with the major dealers, “so that you end up with something that still appears to be independent in some way but is really just another branch of the dealer group.”
Stackpool’s projection of an increasingly consolidated market is not necessarily bad for the industry, he said, so long as consumers are clear about products and services.
“I’m more than happy to go to McDonald’s to buy McDonald’s,” he said, “but at the moment there’s a whole lot of ambiguity, there are lots of advisers calling themselves independent that are attached to and taking a big cheque from the majors.”
While traditionally there is “huge mental divide between the way the institutions think and the entrepreneurs running truly independent advisory practices,” many advisers are willing to put philosophy of advice aside when confronted with a “big cheque and promises of the world,” he said.
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