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Specialise, don’t diversify, claims Broker of the Year

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Australian Broker | 16 Oct 2012, 09:00 AM Agree 0
The 2012 Broker of the Year reveals how focusing on specialisation, not diversification, is key to his success
  • 1martym1 | 16 Oct 2012, 09:52 AM Agree 0
    hear hear
  • john_t | 16 Oct 2012, 10:05 AM Agree 0
    Specialisation is all very well and good until that particular sector (eg investors, first home owners) has a downturn. Arguably you're increasing your business risk by i) relying on overall lending activity and ii) activity within a certain sector.

    I believe diversification makes your business and it's revenue more resilient and predictable and therefore more valuable, but each to his or her own.
  • Moonae | 16 Oct 2012, 11:01 AM Agree 0
    Refreshing. Nice to see that there are others who share my view. I am a Finance Broker and financial planner but I know there are better planners than me. One stop shop sopunds like a good concept but invariably people are better off taking a best of breed approach. if you can be good at what you do but also be a strong hub for referrals to other great professionals who do the same, I think you can increase your revenues the right way with a strong network approach. The best in the business do it this way.
  • PeterT | 16 Oct 2012, 11:22 AM Agree 0
    Couldn't agree more. We also don't market aggressively and we specialise in a particular niche. Within certain circles of influence we've become very well known and we do very well out of it.
    I'd go one step further and say you need to be strategic about what you specialise in. A first home buyer specialist is fairly basic and anyone can do it. Investment & non conforming specialisation is more complex and clients in those areas can quickly tell the difference between someone who is an expert and someone who isn't.
  • scopher | 16 Oct 2012, 11:34 AM Agree 0
    Not wrong there Mark, unfortunately the media in our industry has been obsessed with this D word.

    Diversification in broking is a bit like sex: everyone is talking about it but very few are getting any...
  • Incognito | 16 Oct 2012, 11:40 AM Agree 0
    "We don't believe in loan writing"

    That's an interesting comment from the broker of the year. I must be missing something.

    But I do agree with the specialisation thing though.

    Diversification is all about pleasing aggregators and bosses it seems
  • Emma Lockwood | 16 Oct 2012, 12:25 PM Agree 0
    'We don't belive in loan writing'? How does one become a successful broker if you don't believe in writing loans? I am genuinely confused. What is at the core of your business if you're not writing loans?
  • BONED | 16 Oct 2012, 01:13 PM Agree 0
    Yes, agree this is refreshing as it is a very similiar model to the one we run. I think you guys are taking the 'loan writing' part out of context. I believe what he is saying that we don't just 'write loans' per se, but that is a byproduct of what we are about ie writing the loan is like saying 'hello'...
  • Broker | 16 Oct 2012, 04:34 PM Agree 0
    I agree 100% , just do what you do really, really well and the rest will take care of itself without the need to diversify.

    Perhaps this diversification debate is just another smokescreen to soften brokers up for another commission whack...and wouldn’t the majors just revel in that!
  • David | 17 Oct 2012, 01:12 AM Agree 0
    Have to agree with Incognito, Scopher & Moonae. You can't be, and shouldn't try to be, everything to everybody. I don't go to my doctor to get my car fixed and similarly I don't give advice to my clients about their super or life insurance, when arranging their loan (and nor am I qualified).

    I have no idea how you can be good at everything if you diversfy too much. I got out of banking because I didn't like having to shove insurance or other unwanted products at every client who walked in the door.

    I also don't want to be implicated in any sort of financial advice, that might go bad (and everyone has heard of that happening), from someone I referred one of my clients to, that I received a financial benefit from.

    I have been helping my clients with their borrowing needs (writing loans)for more than 22 years. In my 9 years as a broker I have never advertised. Call me old fashioned but All of my business comes from "word of mouth referrals". I don't have a website (they all contain something which is out of date, even Westpac's), don't use facebook (I'll leave that to my daughter) and have no idea about twitter (nobody needs to know what I had for breakfast).

    Sure, if I wanted to be busier and make more money, I suppose all these other things might work, but some of us are happy in what we do. I would guess most of us (mortgage brokers) do not want to be the next John Symonds or Mark Bouris (imagine the headaches they must face every day).

    One last point, can someone tell me how a broker can specialise in one type of loan? I hear it often but can't understand how a broker can specialise in say First home buyers, Second home buyers, High end loans or say Investors. Do they turn away borrowers who are not in their "specialist segment"? Turn away a small fish at your peril, as they may lead you to a bigger fish.
  • suspicious | 17 Oct 2012, 12:01 PM Agree 0
    I have never met a really good mortgage broker who is also a really good financial planner & vise versa ....

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