In this third entry of the nine part series, Brendan Wright, CEO at FAST, outlines some quick tips for brokers keen to tap into the opportunities which diversification and SMEs represent.
At FAST, we see diversification as the key to success in this ever-changing, competitive finance industry. Our commercial and asset finance division is a cornerstone of our business, and has been since our inception over 15 years ago.
It can be daunting for brokers to think about expanding their business model into commercial lending, especially when providing such specialist knowledge in an unfamiliar field. At the end of the day, brokers need to remember that they are business people too and can easily identify with their clients’ challenges and needs.
Here are some tips on how you can begin to tap into the opportunities that commercial represents.
Take one step at a time
A gradual approach to integration is a good way to start. For example, you might want to implement a referral model in your business with a more experienced commercial or asset finance specialist. Your aggregator can help or reach out to your peers and get a referral arrangement in place as a first step.
Down the track, once you’re more comfortable with the products and processes involved in commercial and asset finance, you can look to bring these services in-house. Then you will want to think about the variety of commercial and asset finance products on your lending panel in order to meet your client’s unique needs.
Invest the time to future-proof your business
If you are committed to developing your business, you’ve got to be committed to investing in it. While it might not be necessary to become a complete expert immediately, if you’re serious about this opportunity and want to future-proof your business from increased competition in the marketplace, I’d recommend taking the time to build your offering in this space ahead of talking to clients about it.
It’s important your aggregator is equipped to support you through the process – if you have access to a good BDM, they can be a key resource for product support, training and strategic planning.
Engage with your clients
Around 10 per cent to 30 per cent of most brokers’ existing client base will be small-business owners, so it’s all about incorporating commercial and asset finance into your client conversations. These clients are expecting their broker to offer broader solutions to their business and personal needs.
A great way to get front of mind amongst your clients is via regular communications. A monthly e-newsletter reminds clients about their expanded service offering. Then, when the need comes for commercial finance, the broker is front of mind.
When offering commercial and asset finance solutions, it’s important to consider the whole picture. Brokers can add more value for business owners by anticipating their other finance needs, such as protecting and growing their existing capital.
It’s critical that brokers identify existing opportunities within their customer base, look at ways to integrate this channel into their practice, and start having the conversation with clients about their business needs.
Remember, the biggest mistake is not doing anything because if a broker does not meet these needs of their clients someone else will.
Brendan Wright will continue to help brokers across the country learn how to unlock their potential in this blog series.