Vox Pops: ifa analyses the big issues impacting the industry
Is more industry consolidation expected in the next 12 months?
Paul Barrett, general manager advice and distribution, ANZ
“As the regulatory environment becomes more certain, I expect more players to look for scale in the short run. Super funds, adviser groups, and platform providers caught between being small-and-nimble and large-and-efficient will need to get bigger or smaller to compete. In the long run there will be new players with new models focused on new customer segments and modes of delivery. The digital age combined with the emergence of gen X and Y will see to it that a new breed of competitor will emerge. The consolidators would do well to use their newly found scale to prepare for this new world.”
Rick di Cristoforo, managing director, Matrix Planning Solutions
“I do believe there will be more industry consolidation over the next twelve months, though what we will see over the next twelve months is really just the outcome of strategic decisions made in the previous few years. That is, advice and licensee companies who are already quietly going about their process of selling/buying, as well as those like Matrix who have been transparent and public with their sale process from its start. However, I do believe the pace of consolidation will reduce somewhat, and then potentially reverse longer term.”
Matthew Rowe, managing director, Hood Sweeney
“I believe that we are seeing a changing and dynamic landscape in our profession, driven by government and regulatory change, changing consumer expectations, information technology and a community driven shift in remuneration models. It is inevitable that, given this environment, there will be consolidation driven by succession issues, scale issues and a particular strategic view of the future. By the same token, however, I am also seeing a number of new boutiques, mergers of equals and the establishment of new practices as financial planners leave ‘employed models’ to become masters of their own destiny in their own practice.”
Philippa Sheehan, managing director, MyAdviser
“Yes. Financial planners and independent licensees have been doing it tough for many years now. We have been hit from many sides - market volatility, product failures and takeovers, frozen funds, clients who have blamed advisers for their plans going off track, FOFA, the list continues. To be profitable in this type of environment is difficult. Efficiencies from consolidation are certainly attractive; however do they come at a cost to the client? I believe that if financial planners have the opportunity to assist clients achieve their objectives with strategies and products being only a small part of the strategy, it can be.”
Tony Fenning, managing director, SFG
“While we’ve seen a heightened increase in consolidation recently, I expect there to be further consolidation over the next 12 months, particularly amongst unlisted, independent dealer groups, and those advisers looking for homes that can help them address the upcoming FOFA changes. Once we get past FOFA, I think we will be closer to reaching the ‘deconsolidation’ phase: the swing back to independence, and independence that’s sustainable in the new world.”
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