Industry leaders flag value of diversification, paying attention

Mr Donaldson urged to do so - warning that the demand for mortgages is on track to drop and excuses for not diversifying may disappear.

Reflecting on the conversations he’s had with brokers over the last six years. Mr Donaldson said that brokers may have been dragging their feet on offering more than mortgages because "it has been such a buoyant market”.

He explained: “You try and carve some time out to go and focus on diversifying your business and expanding your offering across your client base [but] when you’ve got mortgage applications coming in all the time, it's not that easy. And the income is coming through so you don't feel like you really need to do it.” 

However, Mr Donaldson said that brokers should be diversifying now, given mortgage demand was falling.

For example, figures released by the Australian Bureau of Statistics (ABS) for May 2022, reveal that new owner-occupier loans dropped by 9.7 per cent when compared to the same period the year prior.

“If this isn't the catalyst I don't know what is, because demand will drop,” he said. 

Mr Donaldson added that, as business owners, brokers need to “build resilience” in their business model as well as to expand their offerings. 

He suggested that brokers should therefore not just see themselves as someone who only provides mortgages. 

“You are a finance professional. Your clients love you. They want to deal with you. They're time poor. {but] you're independent, you've got the market covered and can get them the best deals,” Mr Donaldson said. 

The Accendo co-founder added that while diversification allows brokers to meet needs of their clients, it also will increase incomes over time while also scaling businesses. 

Mr Donaldson concluded that if brokers can provide complete customer service and begin the pathway to diversification through training and education, brokers could have lucrative new business streams within six months. 

"You will create lifetime clients"

As well as highlighting the value of diversification, the panel discussion also looked at other opportunities for brokers.

The value of being aware of a clients needs was flagged by the owner of Success & Broker, former broker Ruan Burger.

“Seven out of 10 people are talking to brokers. So all we need to do is pay attention to what we say and pay attention to what they say,” Mr Burger said. 

“Make sure it has value, measure the conversation — because what we measure, we can manage.”

Mr Burger recommended that brokers ask clients if conversations made sense and if it was of any value, to cement to the borrower broker value and boost confidence.

“Let them tell you whether this conversation was of value and, if it was, your very pitch, your very conversation spiel becomes a lot easier to engage,” Mr Burger said. 

“And the reality of it is because we are part of a legacy play. We are very much part of people's livelihoods, people's outcomes. We're in such a good position and in such good space. So don't let the moment discourage you. Embrace it.” 

Mortgage Success principal Katrina Rowlands echoed a similar sentiment, telling brokers to understand their value to clients.

"If you're not in a position, knowledge-wise or experience-wise to offer that, or understand or be comfortable with it, get comfortable before you speak to your next client,” Ms Rowlands told the audience.  

“That's a huge opportunity. You will create lifetime clients.”

[Related: NAB reports invoice finance boost of over 20%]