Most clients will provide referrals; the trick is in spurring them to action. Schwab Institutional is running a series of workshops to help advisors nudge their clients into sending more business their way. The San Francisco-based provider of custodial, trading and operations support to about 5,000 registered investment advisors says its research indicates that “90% of independent investment advisors' clients are willing to refer their advisor to friends or relatives,” but don’t often think to do so.

“Our workshops help advisors educate their clients as to who they can help and when, so that when clients come upon a friend, family member or colleague with an immediate, substantial investment need, they will think to recommend their advisor,” says Tim Welsh, head of business consulting at Schwab Institutional.

One in five

The workshops are run by Bjorn Millom of the Millom Group, a Salt Lake City-based consultancy that specializes in referral development strategies. Schwab says Millom helps workshop attendees arrive at “a high-integrity, comfortable approach [to] initiating referral conversations” that they’re urged to try out in calls to “a few trusted friends or clients.”

Properly handled, a few such conversations can yield 15 or 20 names and three or four new clients, says Millom. “With a little skill, insight and practice, I believe that advisors who have their clients’ best interests at heart will generate as many qualified referrals as their practice can handle,” he adds.

About 300 advisors have attended the workshops over the past several months, according to Schwab.

Schwab Institutional was custodian to about $365 billion in client assets as of 30 June 2005. That’s roughly a third of all assets custodied with the Charles Schwab Corporation. –FWR

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