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Education standards to force single owner businesses to sell

An advice business broker has predicted that the current education standards will see advisers leave the industry and force some single owner businesses to sell.

In a new blog, Centurion Market Makers outlined predictions for the marketplace in 2021 and pinpointed education standards and FASEA.

Education standards and the FASEA exam deadline during the year, will see an increase in advisers exiting and we expect some will be single owner businesses that will seek to sell,” the blog read.

We expect enquiries in this respect to pick back up closer to the cut off date for non-university qualified advisers.

We caution advisers in this position that a rush of books onto the market at a time where there will be far fewer buyers will attract lower prices and leave some advisers without a solution.

A planned process to exit the industry is always preferable, and leaves advisers with more options than a rushed exit.”

Centurion’s comments come only a week after the chair of dealer group Synchron, Michael Harrison, said during a House of Representatives standing committee that FASEA’s lack of recognition of prior study is seeing older advisers move into mortgage broking.

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“... they consider it less onerous, less regulated, they don’t have to worry and there’s no argument about where the commission is going to appear, Mr Harrison said.

“I think that’s an issue. But I think also anyone over the age of about 55 who looks at going back to university to do a degree is saying ‘It’s all too hard, I’ll find another way.’”

Other views by Centurion included in the blog are that buyers are becoming more discerning” and are stratifying client bases when developing offers” and that grandfathered commissions have been eliminated since dropping off in late 2020.