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Forward Thinking Magazine : April 2011
14 Matt Carter, Australian Financial Planning Group (AFPG) The driving force behind Matt Carter’s decision to adopt a diversification strategy was his understanding that diversification was the best way to grow his business and bring in new revenue. His business AFPG initially provided financial advice but now successfully offers advice on mortgages, insurance, direct shares and property. Carter says when the company was first established in 2000 it worked with an institutional dealer group, then got its own licence in 2004. It now has 12 staff with offices in Sydney, Melbourne and Brisbane. He says diversifying his business has been an excellent decision. “We now talk to clients about everything to do with their finances – whether it’s insurance, gearing, mortgages, debt reduction or direct property.” Carter explains his strategy is about turning what some planners term the ‘C and D’ clients – the mums and dads who don’t bring significant income into a practice – into ‘A and B’ ones. Case Study “Even if someone only has limited assets to invest, I feel you can increase their value to your business by offering them advice in other areas, such as mortgages, and that can bring in new and recurring business. They become a whole new value proposition.” While there are challenges with diversifying into other areas, Carter says he is lucky in that he was involved in the mortgage industry for 10 years prior to becoming an adviser. He also had the right back-end systems in place to make the move into mortgages relatively easy. “We have a back office engine in place to get mortgages onto the books. This allows us to minimise the impact on our advisers as there is a lot of going back and forth.” Carter recommends bringing in short-term external support to help educate those in the practice about the new service offering. “This might have an impact on revenue initially but it’s worth paying to be educated,” he says. “I’m also a firm believer in keeping the client relationship in-house – all aspects of our client relationships are dealt with by our own advisers.” Carter says his clients love the fact they can discuss any aspect of their financial situation with him and his team. “They appreciate not having to deal with six different people; they like having a one-stop shop,” he says. “I can talk to them about their entire financial situation and then put it all together for them.” But he says it’s important not to diversify just to increase revenue. “If I offer a client options to invest into shares, managed funds or direct property, then I’m saying the choice is yours – and I’m here to guide you through those choices,” he says. “This also benefits me as clients don’t come back later and say they were pushed into a particular area.” Sometimes clients do want to maintain separate relationships and Carter is fine with this. He says there have been situations where a mortgage broker may refer a client to his business and the client wants to continue to keep their relationship with the broker. “That’s okay by us,” Carter says. “We need to be able to improve a relationship or otherwise we leave it alone. If you can’t facilitate a better relationship, you are better off doing nothing at all.”