Small (but Mighty) Business Owners Are a Tough “Get” for Financial Advisors, but Securian Research Uncovers Opportunities

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ST. PAUL, Minn.--(BUSINESS WIRE)-- For many financial advisors small business owners (SBOs) are highly desirable when building an advisory business because of the many financial services they need and use. But SBOs are legendarily difficult to get in front of because they are so busy and not particularly interested in hearing about a service they’re not convinced they need.

“Our research shows small business owners have many financial concerns, but only half work with financial advisors,” said Kerry Geurkink, director, Annuity Marketing, Securian Financial Group, Inc. “And even then they work with advisors more on personal finance than business-related issues.”

“Small but mighty: Growing opportunities for financial advisors and small business owners” is a summary of Securian’s deep dive into the financial concerns small business owners consider paramount. The online, statistically valid survey of 435 SBOs across the US shows their top financial concerns include cost control, profitability, building wealth, financial security for their families and rising health care costs.

Ironically, the percentages of SBOs who want outside assistance with these concerns is much larger than the percentage who actually seek and use it. (chart page 4)

There are circumstances under which SBOs consider seeking a financial advisor’s services. All fall in the typical advisor’s “sweet spot,” including business succession planning, personal finance, asset management and employee benefits. (chart page 6)

How does an advisor get on a small business owner’s radar? Recommendations from family members, business acquaintances, and other financial professionals provide the best entrée to an SBO. (chart page 7) Clearly, networking with bankers, accountants and attorneys is important.

“But once that first meeting is scheduled, the advisor must demonstrate expertise in running a small business,” say Geurkink. “That part should come easily since financial advisors themselves are small business owners.

“Above all,” she adds, “advisors must prove that assistance from a financial consultant is an investment rather than an expense. Our job is to provide our producers with the tools they need to make that case.”

Geurkink says Securian will use the research to develop a “Small But Mighty” campaign that gives advisors a step-by-step approach to building their small business clientele.

Small business owners surveyed met these requirements:

Private company ownership, sole or shared
At least 50 percent responsibility company financial decisions
At least 50 percent responsibility for household financial decisions
For-profit company not in marketing, market research or financial planning
Three to 250 employees
Minimum of one year as owner.

Quotas ensure representation by company size and owner gender. Data are weighted to reflect the proportion of business size and female ownership (33%) in the United States per 2007 census data.

Downloadable charts and graphs available upon request.

Since 1880, Securian Financial Group and its affiliates have provided financial security for individuals and businesses in the form of insurance, investments and retirement plans. Now one of the nation’s largest financial services providers, it is the holding company parent of a group of companies that offer a broad range of financial services.

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