7. What does DBM mean? Design, build and maintain is the mantra of the landscaping industry.
Landscaping: The homeowner brings in a firm that together with the client, designs a garden plan, builds it and comes around on a regular basis to weed, prune and keep it looking tidy.
Advisory: This is very similar to the financial plan, followed by investment selection and periodic reviews.
8. Professional landscaping vs. Professional money management. In both cases, it’s money well spent.
Landscaping: The homeowner doesn’t know what plants are best suited for their soil or how to arrange them to get the “wow” effect. Professionals do.
Advisory: The advisor brings in professional money managers, each suited to certain style and size categories. Together with the client, they monitor performance.
9. Ongoing payment process. Both have their transactional and fee-based equivalents.
Landscaping: You don’t decide the lawn needs mowing, call around and get a person with a mower in that week. You hire a firm to mow on a regular basis, charged at an agreed set rate per mow.
Advisory: When some clients pay by the transaction, they suspect the motives of the advisor making the suggestion. Asset-based pricing removes that concern.
10. Good clients with bad ideas. Sometimes people go “off the range.” You need to be accommodating.
Landscaping: A homeowner will visit Europe, take pictures of Italian formal gardens and say: “I want that.” The landscaper needs to explain “right plant, right soil, right climate.” They may accommodate the client’s request, yet explain they can’t be responsible for maintaining it.
Advisory: Conservative clients might find a speculative stock they like. Your firm doesn’t follow it. You explain they can buy it, but you can’t follow it for them. The trade is marked unsolicited.
11. It’s too expensive. “This service is for someone else. When I get rich, then I’ll do it.”
Landscaping: These projects can be done in stages. If you forgo professional advice, how much will it cost you in mistakes and dead plants along the way?
Advisory: People can invest on their own. They often sell winners too quickly and hold onto losers too long. How much will not getting professional advice cost you? In both cases, it may be less expensive than you thought.
Your prospect or client has likely tried their hand at gardening. If it didn’t turn out the way they hoped, they understand the value of professional advice.
Bryce Sanders is president of Perceptive Business Solutions Inc. He provides HNW client acquisition training for the financial services industry. His book, Captivating the Wealthy Investor can be found on Amazon.