And what I keep hearing is that this year’s “suck factor” is exceptionally high.

A big reason it sucks so much is the lack of discipline and strategy in how most books of business have been built. You likely have too many accounts that produce too little revenue and demand too much attention.

You may not be able to make 4th quarter easy, but you can make it easier. Start by recognizing that not every account willing to work with you deserves the opportunity.

The times they are a-changin’ (finally!)

This industry (at least the forward-thinking advisors) recognizes the need to move beyond a transactional role with your clients and, instead, be innovative and transformative when it comes to serving their needs. But it's difficult to do that when you can't even catch your breath because of the constant demands of the most basic service and renewal activities.

Advisors, heal thyself

Innovation and transformation must start at home. You need to transform how you build your business to have enough time and energy to transform how you impact your clients' businesses.

The first step to transformation is to take an honest assessment and clearly understand your current book's structure. List all your accounts from the largest revenue account down to the smallest. Now, do some dissection and analyze how healthy of a book you have built:

  • What percentage of your total revenue is driven by the bottom half of your book (if you have 100 clients, what percentage of revenue is driven by the smallest 50)?
  • By the bottom 25%?
  • By the TOP 5%?

Chances are your answers will be similar to the following, which reflect the typical book of biz:

  • By case count, the bottom half generates, on average, a little over 6% of total revenue.
  • The bottom quarter generates, on average, about 2% of total revenue,
  • while the top 5% generates 30% of total revenue.
  • And most of the time, if you wrote 1.5 new accounts that average the revenue in your top 2%, you could replace the revenue from that bottom half.

Have I got a deal for you!

If you went to most people and asked them, “If you could reduce your workload by half but still get paid 94% of your current compensation, would you?" (I can hear the chorus of "Hell yeah!” as I type.)

Why wouldn’t you do the same thing? Or go one step further?

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Building an enviable book of business

Your top 5%, by case count, likely generates 30% of revenue. What if you systematically started replicating that top 5% ten times over (you wrote them once, why not again?) while eliminating your bottom 95% (or improved their revenue through fees, account rounding, etc., to move some of them into the top 5%)?

Over time, you would have half the number of accounts you do today (5% x 10) and have tripled your revenue (30% x 10).

Example – Assume you have 200 accounts that generate $800,000 in revenue, and it held that the top 5% (10 accounts) were generating 30% of revenue ($240,000). If you replicated this top 5% ten times over, you would have 100 accounts generating $2,400,000.

That may be drastic for many/most of you, but it’s the direction you need to move. As you analyze your book of business, pay close attention to how little revenue you receive from each account in that bottom half.

We surveyed a few dozen brokers recently and determined that the cost to quote a group (fully insured medical, dental, life, and voluntary) is around $1,000. And that’s before paying commission, servicing the account, or providing other resources to the client. The harsh reality is that you’re likely unprofitable on a significant portion of your book of business.

And I do understand and admire, to a degree, your desire to help these small accounts. But should you be working with them if they don't value what you provide enough to pay additional fees to provide you with some level of profitability?

Yes, it’s a bold move

I know the thought of firing clients is scary; I get it. But you must realize that you keep those unprofitable clients at the expense of your best clients. Those best clients are subsidizing a "client welfare" program financially and in reduced access to you and your team's attention.

Of course, I can't tell you what to do with your clients. Still, I encourage you to be honest in asking yourself whether or not you are better off having them as a client than you would be without them.

You and your team are busting your asses to hold on to accounts that cost you money to serve.

Can you see it?

Imagine future 4th quarters where you were handling renewals for a fraction of the number of clients, earning more than you ever did before, and feeling more confident in your client relationships because of the additional attention you had been able to provide because of your reduced workload.

That’s a 4th quarter with a SIGNIFICANTLY lower suck factor!

Those of you pushing boundaries, disrupting, innovating, and transforming are doing something extraordinary. It's a privilege to work with you, a privilege that should be reserved for prospects and clients who appreciate and value what you deliver.


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