Years of unprecedented economic prosperity, an ageing population and increasing financial savviness are ingredients for the emergence of new business opportunities in the investment and finance industry. Yet little financial advice is based on the interests of the client rather than the financial advisor. Why not provide neutral, independent financial guidance questioned Ben Healy, an investment advisor since 1986 who ran a national investment business until semi-retiring in 1999 aged 36.
The result was Wealthyfrog, established in 2002.
The new company would be radically different from anything in the industry, he decided. It would achieve its goal through offering clients one-on-one coaching to build their wealth. It would also be unbiased and would not sell investments or any other products. And, reassuringly for clients, all coaches would have to be financially successful themselves.
In the early years of start-up the financial system went through a series of trials to ensure the concept worked. In 2006 Healy decided to follow the franchise model of growth and has already sold 26 licences.
Healy is passionate about providing practical solutions that help everyday people realise their financial goals. ñIt can be hard to get the right advice on getting ahead financially,î he explains. ñFinancial planners have skills to invest your big super payout, accountants are great for doing your tax return. But how do you learn how to create wealth in the first place?î
The franchise provides straightforward solutions for better money management, showing clients how to spend less than they earn, how to structure their home loan and then pay it off faster, take control of credit cards, get organised so there are no money stresses, ensure they get all their tax breaks, pay the minimum amount of bank interest and fees and prevent money leakage.
ñWhen all these things are working for you, youÍll then need practical investment solutions. To create wealth, most of our clients lean towards residential property, shares, superannuation or managed funds. We look at all the options impartially and work with them to form a practical strategy that they can easily follow,î explains Healy.
ñThese days, it seems like everyone is trying to sell something, and unbiased help is rare indeed. What makes Wealthyfrog different is that we donÍt sell anything or get any kickbacks from anybody: we work purely on annual membership fees. In fact, you simply canÍt buy investments or anything else from us.î
Franchisees have multiple expansion opportunities available to them for the franchise cost of $45,000 plus fees. The set up seems to suit accountants in particular who are adding the business to their existing practices.
It is proving to be an attractive business proposition to business people for another reason: they donÍt have to do the coaching themselves.
ñThey can use other coaches in the network or employ their own coach or coaches. And while some business owners have the qualifications and do their own coaching, others are involved in business development and bringing in new clients.î
ñWe are at the cutting edge of a brand new industry and this in itself has many advantages for our franchisees. We have very little competition in a burgeoning industry, we get a consistent stream of enquiries from multiple sources and the financial rewards for our franchisees are extremely attractive.î
Money market
One of the most familiar names in franchising, the JimÍs group, has taken a leap into a whole new marketplace, the finance profession, with the launch of JimÍs Finance Professionals.
Brad Volling, CEO of the new venture, says todayÍs lenders are not developing distinct customer relationships. ñWe have identified increasing trends in high value customers moving towards service-oriented providers where their individual needs can better accommodated.
ñFinance is now a commodity product and the banks have become the manufacturers, so the focus in developing our franchise network of financial professionals is dedicated to returning a vast choice of tailored solutions, high levels of accountability in the loan process and fostering customer relationships that deliver wow factors throughout individual and changing needs. We are largely recruiting from outside the industry by targeting people who share our ideas on customer satisfaction.î
The response has resulted in 19 franchisees on board, on the way to the target of 214 in the next 24 months.
Offering a very personal service in perhaps rather unusual ways is at the core of the new offer.
ñWhat it means for the customer is a return to relationship banking,î says Volling. ñWhen was the last time your finance provider turned up with a kettle and coffees on moving day or bolted on a home manicure to the finance service? This detail is what we are all about. We even hand our clients a mobile phone to call us about their loan progress so they donÍt incur such costs themselves,î he adds.
How does it work? Consultants take advantage of the network of services available through the JimÍs Group.
JimÍs Finance Professionals does not offer its own product; what it has is a panel of 30 lenders with a comprehensive range of home loans, commercial loans, personal and car loans, leasing and insurance products. They operate in all states except, at the moment, Western Australia, due to licensing regulations.
Taking on a franchise means a three-week induction which includes certification in financial services and specialist training in loan comparison and customer service. Franchisees take up memberships of industry associations and are necessarily compliant with finance regulations for client protection.
ñA recent major lenders survey reported almost 80 per cent of borrowers could not remember their finance providers name 12 months after their loan was settled. This shows the current existence of significantly low levels of ongoing communication with customers. JimÍs Finance Professional will address this situation and create new definitions on customer service as applied to this industry. ItÍs exciting and itÍs long overdue,î insists Volling.