Don’t get caught in the weeds.
From managing clients and their assets to hunting for new prospects, it’s easy to get caught up in the “doing” and lose sight of what it takes to run your practice.
Most advisors rightly focus on their clients’ best interests, but running a profitable business requires practical analysis.
“Spend a day understanding what your real costs are,” says Mike Greene, senior vice president of the Advisor Business Development Group and Financial Planning for Ameriprise Financial Services. “Most practitioners built their practices on their own, and kept their costs on their own,” he says.
As costs become more difficult to manage, profit margins may be at risk. To avoid unsustainable growth, take the time to understand the cash flow in your business operations -- where the money comes in and where it goes out, Greene says.
“Compare yours to a benchmark, so you have some idea of where you stand,” he says.
Looking for Ways to Improve Your Profits? Check Out: Four Ways to Build Sustainable Growth and
5 Business Imperatives for Successful Wealth Management Firms