Trends: The Hybrid Wholesaler Model
An article by A.J. Noll
It’s no secret the Hybrid wholesale model is trending. We were seeing this prior to the pandemic, however COVID19 has only exponentially increased asset managers to move this direction. Companies have seen that virtual selling can be successful and Advisors have been very receptive to this structure as it frees up time for them as well. The recent article, "Asset Managers’ Use of Hybrid Wholesalers Expected to Double" by Ted Godbout on NAPA highlights that an average of 20% of an External Wholesaler’s time is spent traveling to appointments. This is a major chunk of their day/week/year that can be allocated toward prospecting new clients or having additional virtual meetings. In addition, asset managers are seeing this as an opportunity to scale back compensation for their distribution teams. It's an unfortunate reality, but more firms are moving away from paying commissions on gross sales in favor of base/bonus to get a tighter rope around the spectrum of pay from their top producer to their bottom.
The hybrid model will continue to evolve, but it is certainly here to stay. One trend I’ve noticed is firms are now starting to place hybrids out in the field to live in (or near) the territory they cover whereas hybrids of the past worked off the sales desk and viewed more as a Senior Internal that traveled periodically. The role of a true External will never go away as this is a relationship business after all. There will always be a need for in person meetings. However if this trend continues it would not be surprising to see the scale eventually tip for teams to have hybrids outnumber externals in the near future.
Hirenomics continues to be an industry leader in hiring elite wholesalers and have been fortunate to work with many Tier 1 organizations as well as growing boutiques across the country. If you have further questions or interest in learning more about how we can help support your recruiting needs, please contact us at 612.223.7965.