RIA Benchmarking Study

Transcript:

My name is Mike Amash with Westmount Asset Management, and as a principal at the firm, my role really touches on many things, including the management of the firm, our investment committee, working with client relationships, marketing, and business development.

We participate in the Benchmarking Study because we always find something valuable in going through the process, and, for us, it's a requirement in order to keep our business managed in an optimal way, and growing as best we can.

One of the benefits of participating in the study annually is that you're able to recognize trends you otherwise might not see. In any one year, you can look at things and think it's an anomaly, but when you participate regularly and you see trends, whether it's with compensation or with client retention, you know that's it's something you need to work on or improve on if you see it happening regularly.

There's really two key takeaways that we've gotten in the last couple years from the Benchmarking Study. One is our margins used to be one of the highest amongst our peers, and it wasn't really until we looked under the hood through the Benchmarking Study that we realized that was only because we were overworked. We had too few employees for each of our client relationships, and we realized that we had to resize our relationships per advisor in order to serve them better.

Another insight was just this year when we realized that even though we thought our client retention rate had been very high and amongst the highest in our peer group, we realized we were off by about 1- or 2%, and then when we did the math, we realized that 1- or 2% was equal to $300,000 in revenue per year that we were leaving on the table. So just this year, we implemented a new strategy around bringing up our client retention rate across all the advisors of the firm.

Now that we spend more time in our relationships and do more financial planning per relationship, the relationships feel much more sticky, more in-depth, and, in turn, that's led to more client referrals.

Our advice to another firm that hasn't gone through the Benchmarking Study is just to do it. Our industry is way too competitive to not do it, and burying your head in the sand isn't a solution.

Two things that we realize: We always find answers to the questions that we're looking for in going through the study, but, also, we find questions that we didn't know we were looking for through part of the process, as well.