The only way that all the firms aggressively recruiting out there can meet their targets is if they find a better way to keep the reps they already have from leaving.
It's not shocking that better retention is the secret to building a bigger advisory network. About 8% to 9% of all advisors change firms every year.
From the advisor's point of view, that's a great number. It means mobility and freedom.
But from the firm's perspective, it means on average, 8% or 9% of all front-line personnel are heading for the door at any particular time.
That's a huge headwind for broker-dealers that want to boost their net head counts by maybe 2% this year.
Sure, anyone can dangle enough checks in front of disaffected reps to add 100 to 200 brokers to their sales force. Doing that in addition to overcoming attrition . . . gets expensive, if it's even possible at all.
Great piece on how the math works out over here.