Financial Advisors

How to Create a Successful Financial Advisor Business Plan

By July 31, 2020August 3rd, 2020No Comments

A few days of careful planning could save you months of practice management mistakes. As a financial advisor, you have great ideas. You believe you can offer a client experience that exceeds all others. The challenge now is to communicate that vision to prospects and to define the structure of your business to allow you to bring your vision to life. In this post, we’ll provide some key tips on how to create a financial advisor business plan, so you can define your vision and outline clear, actionable steps to help you achieve your business goals.

Need assistance with your business plan or defining your vision? Request a free consultation call with an experienced financial advisor coach from Northstar Leadership Solutions today.

Start with Your Mission & Vision

Your innovative ideas are just thoughts until they’re on paper. Write your thoughts down and create a mission and vision statement for your firm. Explain why you do what you do, what you have to offer, and how you’re the best fit for those you want to provide services to. Be expansive on the first drafts, then cut them down to a few concise statements.

Your financial advisor business plan should include both your mission statement and vision statement:

  • A mission statement is a concise overview of your company values.
  • A vision statement outlines your goals and steps to help you achieve your mission.

For instance, the vision statement of the Alzheimer’s Association is simply “A world without Alzheimer’s disease.” Their mission statement explains how they plan to get there.

Take a Professional Inventory: Perform a SWOT Analysis

It’s important to understand what your competitive position is before you can get into more in-depth strategic planning. This involves taking a detailed look at yourself and your firm. Asking for outside perspective in this step is recommended, since we all view ourselves through a somewhat distorted lens. The process is called a SWOT analysis:

  • Strengths: Examine strengths on both a personal and organizational level. What exactly do you bring to the table? In what areas is your practice strongest? Answers may include client service, technology, access to better financial strategies and products, etc.
  • Weaknesses: This is an area that most of us are reluctant to acknowledge, but we all have weaknesses. Understanding what yours are is critical if you’re going to be successful. Be honest, and you might just find areas where you can improve. This is an area where an outside perspective is often the most helpful.
  • Opportunities: This is a category you’ll need to update each time you do a SWOT analysis for your firm, which should be frequently. There are always opportunities for growth and improvement. Identify what they are so you can go after them.
  • Threats: Do you anticipate a down market affecting your ability to find new clients? Is there an increase in the number of competitors in your space? Don’t view these threats with fear. Instead, identify them, acknowledge them, and make a plan to overcome each potential pitfall.

Identify Your Target Market: Follow the Money

Pull up the data you gathered when drafting your mission and vision statements. Combine it with the list of opportunities you compiled in the SWOT analysis. The combination should give you the ability to define a target or “niche” market where you can seek out new clients. Look for markets that you feel comfortable operating in. Where will your strengths be most useful?

The most common mistake when choosing a target market is to ignore the data and “go with your gut.” You won’t close any deals if there isn’t an opportunity there, even if your strengths give you a competitive advantage. The most important factor when scaling your practice is to prospect where the money is. Don’t waste your time looking elsewhere.

Understand What You’re Up Against: Analyze the Competition

You will always have competitors. Some of them will be other financial advisors. Others could be robo platforms or even stock promoters like Motley Fool and Mad Money. As technology improves, advisory firms are doing business on a national and global scale. Don’t just analyze competition by geographical proximity. That doesn’t exist anymore.

Most of your competitive analysis can be done online. Look at other websites, read their blog posts, and analyze their mission and vision statements. If there are product pages or technology links, examine those. You should also look at any “about us” or “team” pages to see profiles of the principles. Follow that up with a search on LinkedIn to see what they’re sharing.

When including your competitive analysis in your business plan, take note of your top competitors, what they’re doing right, and how you can match or outdo their offering.

Getting the Word Out: Create a Marketing Plan

Everything in your business plan that you’ve done to this point has been designed to get you here. You know who you are and what your firm stands for. Your target market is defined. Competitors have been analyzed. Now it’s time to put it all together and come up with some messaging for your marketing campaign. If you struggle with that, seek professional assistance.

Once you have a grasp on what you want to say, the next step is to figure out where to say it. Your target market demographics may give you the answer to this. Where are they most likely to see your messaging? Social media offers a multitude of opportunities. Trade shows or conferences might be a good fit, depending on your niche. You could even try teaching financial literacy classes.

Don’t get married to any single idea. Marketing is a process of trialing new messages, analyzing results, then tweaking or changing that messaging to get better results. Circumstances may change. New opportunities could open up. Economic and employment trends may shift. Be prepared to make adjustments. Marketing should be fluid, not fixed.

Identify Management & Operational Needs

You’ll need an infrastructure of some kind to handle all the new clients you’ll bring in. There’s also the issue of financing your business venture. This is the final step. Figure out how many people you need and how much it will cost. Once you’ve mapped all that out, your business plan is complete and you’re ready to launch your firm.

Take Your Business to the Next Level

We hope this guide on how to create a financial advisor business plan has helped you focus your thoughts and create a plan of action to achieve your business goals. If you are struggling with your business plan or unsure where to go from here, consider working with a financial advisor coach.

At Northstar Leadership Solutions, we will work closely with you to help you refine your vision, define your goals, and build a plan of action for growth. Get in touch today to request a free initial consultation.

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