7. Pharmaceuticals. Turn on your TV. Who are the advertisers? Drug companies come to mind. There are plenty of “ask your doctor about” ads. Any idea what those advertised drugs cost to buy? Check it out online sometime. The population is getting older. Does your firm think pharmaceutical companies have a bright future?
8. Wireless providers. Everyone has a cellphone. The service to keep them going isn’t cheap. How much is your client’s wireless bill? Do they think the “phone company” is a good investment? What kind of dividends do they pay?
9. Gasoline. Fuel prices are on the morning news. Everyone watches for them while driving. Places with good prices have long lines. People will need to buy gas as long as they drive cars with internal combustion engines. How does your client feel about gas prices? What do dividends look like in this sector?
10. Credit card companies. This category includes financial institutions that also issue credit cards. Your client knows what banks pay on money fund balances. Not a lot. They know what credit card interest is too. Which side of the equation do they want to be on?
11. Logistics companies. Years ago, buying by mail order meant waiting six to eight weeks for delivery. It was spelled out in the advertisements! Today waiting more than two days for delivery is rare. More and more people are buying online. Your client knows “free shipping’' isn’t free because the expense is built into the price. If the volume of shipped items increases, it’s logical someone is making money. What does your research department think about these firms?
These are industries that touch your client’s everyday life. Many firms are household names. They “understand” how they make money. They don’t think those businesses are going to disappear anytime soon. This might get your client more comfortable with considering your investment recommendations.
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 is available on Amazon.