In essence, an investment advisory firm is much like any other retail enterprise. Keep the customers happy and profits will follow.
In essence, an investment advisory firm is much like any other retail enterprise. Keep the customers happy and profits will follow.
At least that's the philosophy by which Mark Snyder lives. He relies on his staff of 10 to keep incumbent clients enthusiastic so that he can spend his time bringing in new ones.
“I delegate anything and everything I can,” said Mr. Snyder, president of Mark J. Snyder Financial Services Inc., a Medford, N.Y., firm that he established 20 years ago. “I'm the opposite of a micromanager.”
The handoff begins from the outset. Mr. Snyder meets with a potential client for about an hour, with an assistant taking notes. For a fee, the firm analyzes his or her investments.
The assistant writes a follow-up letter to the prospect while another staffer puts together the investment mix. Mr. Snyder reviews the analysis, and the potential client comes back in for a one-hour meeting. From that point on, the staff handles bringing the client on board.
“I don't even know what an application looks like anymore,” said Mr. Snyder, whose firm has $200 million in assets under management. “I don't need to get involved in paperwork.”
The staff fields the vast majority of client calls. Mr. Snyder likes to avoid phone work. He's also eliminated quarterly review meetings with clients.
Since he depends on staff interaction with his nearly 500 fee-based clients, Mr. Snyder has to make sure that his employees are engaged in their work.
He does this by giving them job security — he laid off just one worker during the recession — and has increased their paychecks every year. He even granted bonuses and raises in December 2008.
“They appreciate that,” Mr. Snyder said. “They bend over backwards to help our clients. I have to keep my employees happy to keep my clients happy.”
Mr. Snyder, of course, also interacts with clients — especially the high-net-worth individuals who make the firm profitable. The firm holds three events every year for their A+ and A clients. The former have $1 million or more in assets; the latter have between $500,000 and $1 million.
There's a dinner dance in May for about 250 clients. “It's like a wedding,” Mr. Snyder said.
About 150 clients participate in a theater party and a dinner at a local restaurant brings in about 118 clients.
Mr. Snyder also established a client advisory board this year.
At the group's suggestion, he will launch a series of educational workshops this year. The first will focus on laws affecting the elderly.
Mr. Snyder also has instituted, again at the suggestion of his advisory board, a periodic e-mail blast about changes in investment strategy. This communication was particularly popular when he assured clients that he had taken 30% of their assets out of equities the day before the market dropped 500 points in August.
“Because of that, they're referring people to us who are not as happy” with their advisers, Mr. Snyder said.
In the end, Mr. Snyder can't point to one magic profitability bullet.
“I'm not sure,” he said. “[But] it's working.”
mschoeff@investmentnews.com
