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June 1, 2012

Get More Out of What You Have, Study Says

By Editorial Staff

Like the rest of the brokerage industry, many clearing brokers often are not properly using the book of business they have. They are not trying to find out how they can become advisers to their correspondents and more effectively manage their relationships.

Bill Coppel

That's the contention of Bill Coppel, chief client growth officer for Wells Fargo's First Clearing Correspondent Services, which just finished a study along with the Oechsli Institute, titled "Growing Your Business in the New World."

Organic growth, making the existing firm more productive by bringing in more business from clients, will be critical in prospering in challenging times for clearing brokerages-a time when trading volume is down and traditional lines such as margin loans services are down, according to the study .

Coppel, who says First Clearing has shrunk its client base over the last five years but increased its business, says any broker-dealer can do the same.

That is, he adds, if it emphasizes relationship management.

"It's about the quality of the relationship, not about quantity," Coppel said.

He added that the principles of relationship management apply to institutional as well as retail business and go across all parts of the financial services industry.

"Relationship management is the right thing to do for clients and the industry," he said.

Yet the study found that relationship management-the business of developing relationships to their maximum-remains "one of the weakest areas for growth" in the business.

How to reverse this weakness?

Coppel says brokerages aren't spending enough time learning about their clients. This also means knowing how to serve them more effectively. It also means discovering which ones are the wrong relationships and jettisoning them, he adds.

Coppel says First Clearing, with some 85 clients today, is healthier, even though it has some 60 fewer clients than five years ago.

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