Impact of the GFC on Boutique Advice Practices

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Do you agree that the Global Financial Crisis will result in a consolidation of the number of financial advice practices in Australia?
  • Yes (73%)
  • No (14%)
  • Not sure (14%)

As we place our cue in the rack (for the time being) on the issue of adviser remuneration, we now turn our attention to the impact of the Global Financial Crisis (GFC) on boutique advice practices.

Some industry commentators are suggesting that one of the outcomes of the GFC will be a consolidation of the number of financial advice businesses in Australia. The reasoning behind this point of view is that in times of economic uncertainty, consumers (and advisers) will seek safety and security in larger, more ‘visible’ financial planning groups.

In a recent article from eFinancialCareers’ Simon Mortlock, the argument suggests that while the stock market was operating at record levels, financial planning revenues were also high, and few practice principals were considering the sale of their business.

But with revenues sliding, in a lot of cases substantially, anecdotal reports suggest that many smaller, boutique advice firms are either looking to merge with other practices or transfer/sell their business into one of the larger financial planning groups that best reflect the culture of their business.

But does having fewer boutique advice firms mean less choice and flexibility for the consumer? Or will the consumer continue to receive exactly the same level of service and insurance and investment advice from the same adviser who has now moved into a larger or top 30 dealer group? The answer to these questions may vary depending on the individual circumstances of the adviser and client and the policies of the dealer group.

But for the purpose of this poll, we want to know whether or not you agree that the GFC will ultimately result in a consolidation of the number of financial advice practices in Australia, particularly as many advisers reading this poll article will have a strong opinion based on their own present circumstances.

Vote Now!



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