I lost a potential client to a much larger company recently. I say lost but it’s all part and parcel of being a financial planner with a clear understanding of who and how we help people. We want to run a unique (I think the overused term is "boutique") firm, and we only want to work with those who are the right ‘fit’ for us - and the connection has to be mutual.
That said, it’s always important to examine why the fit sometimes isn’t right.
This particular client was concerned that we wouldn’t be able to offer the same level of security as a bigger financial planning company. He said he’d feel safer with them.
I can see why he made this decision. Bigger firms often appear safer because they have big brands and marketing budgets that can shout about their history, their vast departments, and large offices in expensive locations.
But is this in fact ‘more’? It might have been the case a decade or two ago that a larger firm would be safer than a smaller one, but regulation has become a lot stricter since then. We have to meet the same strict standards in order to practice as a large firm.
The fact is that you don’t need to work with a huge corporation to make your money work for you, or for your money to be safe and secure.
Here’s why bigger isn’t always better…
When you work with a smaller financial planning firm, you benefit from a truly bespoke service. It’s simply not possible for a big firm with thousands of clients to tailor its offering to each individual.
I’ve found that the fewer clients I have, the easier it is to get to know them as individuals. I try to treat each of them as if they’re my only client. I’d hate for them to feel like a number on a spreadsheet. They know me and they know the team around me.
It might sound trite, but we want to build a relationship with you and your family over decades — it’s a bit like seeing the same GP since childhood.
They’ve been there for you since the beginning and they know your history. When you tell them your symptoms, they’ll use all the information they’ve already learned from you to make an informed diagnosis.
If you were to feed those same symptoms into an online symptom checker, however, it’d give you a list of the same conditions it’d give to everyone else. The suggestions might not be relevant at all.
Now, I’m not saying that large financial planning firms are the same as online symptom checkers, but they’re both designed to cater to the masses. That means the service has to be limited and replicated nationally. Nothing is unique.
If you want a personalised service, it usually pays to use a smaller firm.
Big firms are often so focused on getting quick results for a large number of clients that they’re unable to pay attention to the finer details. Spelling your name wrong or forgetting to send over a document might not seem like a big deal, but it does make you wonder what goes on behind the scenes. What else are they missing?
Smaller companies tend to have an attention to detail that’s hard for larger firms to replicate. We can take our time, double check our work, and ensure each client gets the service they deserve.
Some clients assume that big companies offer a higher level of protection than small financial planning companies, but this isn’t the case. Our clients’ money has the same protection that clients with much larger companies have.
We aren’t stuck in the ‘80s, storing clients’ personal information in filing cabinets or sending endless letters through the post. The Barnaby Cecil app gives you access to all your documents, accounts and reports from the palm of your hand. Of course, it’s completely secure and encrypted, so your data is always protected.
Just like any large firm, we’re regulated by the Financial Conduct Authority (FCA), and have professional indemnity insurance. Whether a financial planner is large or small, it’s not possible to operate without these protective measures, the FCA simply wouldn’t allow it.
Many small advisers are currently disappearing from the market as larger networks offer them life-changing amounts of money in order to buy them out. Very often the client loses as a result. It can often be the case that they’re suddenly moved to a different, more expensive charging structure; it’s certainly true that they’ll lose that personal touch I mentioned above. New clients when they join us often complain about being passed from one adviser to another. One new client had met new three advisers in five years!
I didn’t create Barnaby Cecil to simply sell it on. It’s not something I’m interested in. I want to retain the business as it is, adding more services and utlising technology to make it more and more efficient, but we don’t want to take on huge numbers of clients or new advisers.
I’m often asked why I don’t take on more advisers. Whenever I’m asked this question, I’m reminded of law firms and advertising agencies with every partner’s surname included in the brand. In Mad Men, Sterling Cooper becomes Sterling Cooper Draper Price as it grows, for example.
Barnaby Cecil is named after my sons. If I welcome two new advisers and they each had two children each, would Barnaby Cecil become six words long? If I left it as it is, how would that work for the new adviser? I wouldn’t mean to them what it does to me. That's always my main concern. Why would anyone care about Barnaby Cecil as much as I do?
Name changes aside, we’d hate to lose that personal touch. Our attention to detail, bespoke service and close relationship we have with our clients is what makes us special. It’s something I’m extremely proud of.
It’s true that bigger might have meant better years ago, but these days, with the better technology at our fingertips, and the same regulatory requirements to meet as other firms, there really aren’t any downsides to working with a smaller firm that I can see. Only positives.
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