It would not appear as though the masses are exiting BofA’s Merrill’s Wealth Management even though MSSB snatched a star producer from Merrill.

Just in the last month, they have picked up 80 new Merrill Edge Financial Solution advisors from California and Nevada. And now they’ve added 27 more in the Southeast U.S.

Their goal? An increase of 1,000 Financial Solution advisors by years end. According to division manager, David Giancola, “We think this is a huge growth market for us.” Read more.

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No longer do we rely solely on ourselves to create first impressions. In fact, our websites are becoming more and more influential in determining how our clients perceive us and how successful we are in growing our business.

True for financial recruiters as well as advisors. We have created and designed our site to “sell” ourselves and our services, and consequently we encourage our potential clients to “check us out” by going to our website.

With this media being so critical, I read with much interest the article posted on June 14 in OnWallStreet.com by T.J.Gilsenan. Not only does he give you five ways advisor websites go wrong, he tells you how to fix them. Well worth the read and you can find it here.

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We’re seeing a “flip-flop” in the financial recruiting arena lately. Big brokerage firms are now knocking on the doors of “independent” brokers, and that marks a change for both parties.

During the financial crisis, firms like BofA’s Merrill Lynch and Morgan Stanley held on to top advisors with big retention bonuses and deferred-pay recruiting packages that keep advisors from leaving.

Obviously, this has narrowed the field for good recruits. (There has always been an undertone in the big brokerages that independent advisors could not meet the terms of client assets and production of the big wirehouses, and conversely, the independents shunned the bureaucracies of Wall Street firms.)

Reuters reported on May 19, that executives at Merrill have told recruiters to include LPL Financial and other independent firms in the recruiting pool, and they have held at least one seminar this year for independent advisors hoping to change the misconceptions that big firms and independents have about each other.

According to Reuters, Sallie Krawcheck, Bank of America’s global wealth chief, reported that Merrill recruited 25 advisors from independent firms last year, and a spokeswoman for MSSB confirmed they have been encouraging recruiters to include independent advisors in their searches.

So, will the wirehouses continue to “lure” the independents? Time will tell, but they do appeal to big producers who have complex product and service needs…and they do pay the big bucks.

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With a history of hiring career changers and entry level trainees, Edward Jones wants to recruit at least 230 experienced advisors this year, at least one for each of their regions where they operate.

Earlier this year, they added three new recruiters and streamlined their hiring process.

Jordy Evans, principal of Edward Jones told Registered Rep,

“We intend to continue growing as a firm and we are not slowing down the recruiting of career changers or people who are unlicensed, but we want to add experienced FAs who care about their clients and are craving the stability we feel we can offer. It is an exciting time to be recruiting experienced FAs because of what is happening in our industry.”

So who qualifies? According to Evans, a veteran advisor with a minimum of three years experience serving clients, a minimum of $20 million of assets under care, and a minimum of $150,000 in gross revenues in the prior 12 months. (Noteworthy, is that the 50 veterans hired in 2010 had an average of $300,000 in annual revenues, about $50 million in assets under care and about 13 years experience.)

Edward Jones appeals to advisors who want the support of a full-service firm, but want a smaller more intimate culture than the wirehouses provide. Evans also noted they are also appealing to advisors nearing the end of their career as they have an attractive succession planning and profit sharing process.

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Last week 409 independent financial advisors gathered in Chandler, Arizona to attend the Peak Advisor Alliance Excell Meeting.

At one session, Ron Carson of Carson Wealth Management asked the attendees how many ask for referrals at every opportunity.

Very few advisors raised their hands. Since the majority of business is actually done by referrals, and advisors are “coached” to ask for referrals why are so few of them actually doing it? Appears that most are just not comfortable doing it because they don’t know how or when to do it, or lack the confidence to “sell” themselves and their expertise.

Carson said the “comfort” comes by educating your clients as to why they love you and doing business with you; the “when” is initiated by you at targeted events whether is be at a sporting event or over a beer or coffee after work, and always when someone compliments you.

Matthew Halloran, a coach at Peak, said “Confidence is the real difference between a pro and a real pro…an advisor needs to work to solicit a compliment, then ask a lot of open-ended questions to gain information from clients which will generate referrals.”

Said it before and will say it again…you have to sell yourself and your services over and over and over again.

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It’s no secret that the advisory workforce throughout the industry is aging, and now that the economy is recovering, firms are acknowledging that they need to bring in new FA’s to counter-balance that. So what are some of them doing?

OnWallStreet reporter, Frances A. McMorris, ran a comprehensive piece on February, 1, 2011, regarding current trends in training new advisors. As an overview of the article, “From Book Smart To Street Smart” here’s the lineup:

Wells Fargo-A 19 week training program, with a core program of two and a half years including an extensive interview process. Wells Fargo placed 27^th in Training magazine’s annual ranking of top corporate training departments. The firm has the capability to train 100 advisors a month and is focusing on bringing in more women and minorities. Puts a high priority on training as witnessed by the Wells Fargo “University” in St Louis with 250,000 square feel and 41 classrooms.

Merrill Lynch- Noted for decades of devoted training, the financial crisis caused them and other firms to cut back on training, but last year Merrill (now part of Bank of America) reportedly began ramping up its program.

Morgan Stanley- Expects to hire 2,000 trainees, consistent with what they did in 2010. Emphasis will be on placing trainees on teams.

Edward Jones- Based in St. Louis, they opened a new facility two years ago to train recruits with little experience as well as mid-career changers. Currently has a one-week, interactive session, followed by five weeks in the field and another two weeks focusing on prospecting.

Raymond James- Expanding its old four week program. For the past two and a half years, the firm has run a residency program in St. Petersburg, Florida that allows the recruits to focus on how they want their practice to be built as well as on their technical skills. Rookies already have their Series 7, so focus is on practical skills. It’s pretty much a year long program with enables the firm to watch and adjust the training process before moving it to the branches.

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Is the “Hybrid Advisor” the hottest trend on Wall Street?

With the ability to serve as both an RIA advisor and a registered rep, the Hybrid Advisor has opened an avenue to expand their pool of potential clients.

In 2010, Schwab became the first independent RIA custodian on the NFP IndeSuite platform which gives independent RIAs the ability to manage both traditional brokerage and fee-based businesses through one application, thus allowing the advisor the ability to access a central location to make client trades, manage their portfolios and receive compliance and back office billing and support.

In its latest Schwab Market Knowledge Tools report released last week, reported that headcount at firms with dual-registered advisors is expected to increase 4.2% in 2009 to 7.7% by 2014, a significant increase to say the least.

Two obvious reasons for this:

1. The ascent of fee-based platforms at the expense of commissions over the past five years
2. The fact that financial advisors need to expand their revenue opportunities by offering a wider range of investment products and services

This trend puts heavy pressure on the old-school firms to up the ante of their technology investments, and broaden their product portfolios in order to entice and retain experienced and client-rich advisors…an interesting trend to keep watch over.

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Ask anyone on the block and most wirehouses and independent broker-dealers recognize that their core financial advisors are aging and will soon need to be replaced, but very few have done much in the past three years to address the issue. Most have spent their time scaling down the lower-producing employees, (most of which were the younger rookies) in order to cut costs and improve their overall bottom line.

In the meantime, we’ve seen consolidation on all fronts which has created an economic environment for seasoned financial advisors to drift over to independent firms, or to open their own shops. With the economy improving you would think that we would see firms of all sizes trying to look at how to attract and retain quality advisors.

True, there has been an increase in the number of firms establishing new mentor programs and developing recruiting programs, but the majorities are still counting on their seasoned “core” to produce the revenue for the future. The number of financial advisors aged 55 years of age or older increased from 32% in 2007 to more than 36% in 2009 while the number of professionals with less than $50,000 in annual production fell from 55% to 42%…per new report by Pershing LLC, a unit of BNY Mellon.

“The most exciting developments we are seeing that relate to attracting talent are from firms that are developing a value proposition that embraces the hybrid opportunity” says Jim Roth, managing director at Pershing.

More on the Hybrid Advisor model to come…

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The continuing devaluation of Chinese currency is bound to have large-scale effects on the American consumer.

As our economy has shifted towards a service-based one, we have outsourced almost all production to China, Japan, Taiwan, and Latin American countries. As most of the developed world experiences typical inflation, China’s economic policy in recent years has been to keep their currency artificially low in order to force basement-bottom prices on goods exported to America.

So far, this arrangement has been functioning. However, sooner rather than later the Chinese economy will force it to accurately represent its currency. This will skyrocket the prices on goods manufactured in China.

As a result, Americans and American communities should focus on supporting local markets and production sources in order to insulate themselves from the coming storm. Farmer’s markets, and for production goods American-made items will help our economy weather what is sure to be a trying time for much of the world.

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Some RIA firms are continuing to cut costs this year even though they are growing at a rapid rate since the financial crisis of 2008. There are a variety of ways to cut costs in your business. The main cost cutting is the salaries of the financial advisors in your firm. One way to help your firm grow is to offer bonuses based on growth in revenue. This way it benefits the firm as well as the advisors. They will be motivated to bring in more assets.

Another way to cut costs is to streamline your technology. This will help with making your office run as efficient as possible. This can be done by upgrading your customer relationship management (CRM) software or financial planning software. You should think about what software will benefit your firm the most (ie…Retirement planning, tax, or portfolio rebalancing software). Services that are proving inefficient for your firm should be outsourced as well.

Make sure you have regular meetings with your team to discuss new ways to streamline your business. Always revisit the processes you develop because you may find more efficient ways to operate.

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