Consultative Broker Briefing

The Consultative Broker™ Briefing
Volume VIII, Number 3
A Free Publication of C.R. Ekern & Company
888.670.1177
www.crekern.com
Copyright, C. R. Ekern & Company, 2007

I was speaking recently to one of my broker friends and was surprised at his remarks. “It is really tough out there,” he bemoaned, “buyers don’t have big ears anymore.” Upon further discussion, he defined “big ears” as a buyer's concern about saving money on premiums. “It’s just not right”, he continued, “in past years they had them, now they all know the premiums are dropping. I am just not getting their interest anymore.”

Hello . . .Come in Tokyo! I didn’t know how to tell him that his value proposition had a fatal flaw. He was basing his sales model on an outdated business strategy. The strategy of selling on price went out the window in the late 90’s. Now, he was sailing into the wind.

As a Consultative Broker, you know that the marketplace is eroding on price. Now is the time to align your sales strategy with those of your clients and prospects. Show them how you and your organization help buyers reduce costs. It is an entirely different discussion and one that will stand the test of time. If you continue to sell on price, you will place yourself and your firm out of business. Here is why:

Your clients will ruin your business. Not only will these buyers leave you eventually on price; but each year they will beat you down into the ground, never invest in loss control, and continue to have their experience deteriorate. Ultimately their account will be so bad that the good lord himself wouldn’t take the risk.
Your carriers will abandon you. Some of the more astute carriers are beginning to understand what their value proposition actually is. Remember, there are only seven national multi-line carriers who license agencies. Those of you that keep the carriers on the lowest price merry-go-round will eventually find yourself without a chair when the music stops.
Your health and family life will suffer. This is a tough business. We make it tougher on ourselves than it needs to be. Understanding your value and knowing that you will not always be the cheapest, will go a long way in boosting your confidence with clients and prospects. Start telling them so now, before you pay a higher price. The stress of always needing to be the “fastest gun in the west” will kill you.
You will be searching for scraps. When you sell the lowest price, your firm will not be able to invest in loss control, claims management, or any of the other resources that differentiate a highly successful brokerage. Therefore, all the quality clients will be attracted by those organizations, leaving you with the dregs of the insurance barrel.

Those of you that are chasing the market down are sailing against the wind. You must turn the ship around immediately before it is too late. Learn what your firm’s value proposition is, understand how to discuss business with your clients, and be able to demonstrate how you have reduced their costs. Have the skills necessary to develop clients through conceptual presentations. You must do these things in order to not be left adrift, as the wind continues to blow against you.