Before you judge the title, let me add some context. If you know your British comedy you will recognise this line. It was delivered by the irrepressible David Brent as played by Ricky Gervais.
It appeared in The Office Christmas special from 2003 when Brent is no longer the Area Manager of Wernham Hogg and is now a travelling salesman selling cleaning products from one soulless industrial park to another
Pic Credit: BBC Iplayer
If Brent was here he’d probably be shouting: “Oi Stewart! What’s your point?”
Calm down David, I’m getting there.
What the clip shows is not just how to execute a great line. It also shows David Brent to be arguably one of the greatest salesmen we will ever see.
“This is embarrassing. True, but embarrassing,” sniggered Brent.
THE HUSTLER
Why do I say that ?
Because he’s not prepared to let a client interaction get in the way of a missed opportunity. Brent is hustling. He knows there is more than just a sale of a chamois leather and some detergent. He wants the lot and he’s not leaving until he’s got it.
Which leads me neatly on to the context.
“Finally,” said Brent glancing at the camera.
I made a comment in an FT Adviser article five years ago where I said that consolidation was coming to mortgage intermediation. I even dared to suggest the sector may end up in the hands of 20 or so major players.
“I can’t see anything that suggests I am massively wrong.”
Obviously, I was trolled but when I look around today I can’t see anything that suggests I am massively wrong.
The PE money has flowed in, firms are merging, and everyone is trying to scale bigger. It is happening with banks, insurance companies, wealth managers and now us.
But I think to some degree we are going about consolidation the wrong way.
The aggressive nature is to buy, buy, buy then package up the sum of the parts and flog it on to someone else. To me that seems a bit cannibalistic. It is devouring the food chain below you in order ensure your own survival.
“Consolidation is not expansion, it is preservation.”
Consolidation is not expansion, it is preservation. Brent would go for growth, seek opportunities that are less obvious, grow organically with each and every client.
“I bloody would as well,” said Brent excitedly.
When my own firm London Money started trading we were actually an IFA. That’s because I was one and, just like Brent, I knew the opportunities were greater by not being a one trick pony.
Why just speak to a client about mortgages when we could speak to them about all their financial needs?
I brought someone in more intelligent than me to give the advice and by the time we unwound everything five years later the IFA had created £20m of funds under management from no more than 30 clients.
GOODWILL AND TRUST
When you do someone’s mortgage you create not only income but also a tremendous amount of goodwill and trust.
This is the exact moment when David Brent would say: “Can I ask you something? Who does your pension?”
But we don’t. We do some average protection policy and move on to the next transaction leaving the crown jewels on the floor for someone else to pick up.
That’s why, if I were an IFA looking to grow today, I wouldn’t necessarily look at another IFA to buy. Harmonising fee structures and investment philosophies is no easy job, surely it is better to start with a clean sheet?
COME BUY ME
Cooee! I’m joking, we’re not for sale. But if we were you would buy us a lot cheaper than another IFA: the ongoing liabilities would be negligible and you would be buying thousands of existing clients and a business that creates hundreds of new ones each year.
The synergy between a mortgage broker and an IFA is a lot closer than you think, in fact we used to be two sides of the same coin.
A smart IFA should look at a good established mortgage broker as a bolt on – it might just get you where you want to be. Not sure? Here is your proof of concept in the article Mortgage Soup published on Friday.
Anyway, that’s enough from me. David, fancy a beer?
“Just a bit, and you’re buying!”
No change there then.
