Bill Good Marketing Developing Strategic Partnerships This document is intended to help you identify potential Strategic Partners. The Strategic Partner Process, by Rob Rose and Matt Hicken, is intended to help you manage your stable of Strategic Partners. Relationship Mapping Manual contains instructions for the CO to set up your program for relationship mapping, a critical tool to identify potential partners. The Customizable Relationship Mapping RUF is the form you need to send to the CO to map a potential partner. These documents are all available in the Document Library. By Bill Good, Chairman Bill Good Marketing, Inc.
Table of Contents Developing Strategic Partnerships... 3 Objective... 3 Strategic Partnerships: Defined and Clarified... 3 DO THIS FIRST... 3 Standard Operating Procedure: Developing Most Strategic Partner Relationships... 4 Prospective Partner Meetings... 5 Special Instructions on Estate Planning Attorneys... 7 Background... 7 Where to Look... 7 Landing the Right Residential Real Estate Agent... 9 Questionnaire for First Interview with Any Potential Strategic Partner... 10 Questionnaire for Prospective Estate Planning Attorney Strategic Partners11 Managing Strategic Partner Network... 12 Scripts... 13 Script for asking for Strategic Partners.... 13 Potential Partner Script... 13 Cold Call Attorney... 13 Buyers Agent Script... 14 Questionnaire for First Interview with Any Potential Strategic Partner... 15 Questionnaire for Prospective Estate Planning Attorney SPs... 16 2
Developing Strategic Partnerships Objective Obtain a minimum of two new client relationships per month by developing Strategic Partnerships from these (and other) professionals: a. CPA, for business-owner clients and people with complicated returns b. Tax preparer, for people with simpler returns c. Residential Real Estate Agent d. Commercial Real Estate Agent, if you have clients who own commercial property e. Property and Casualty Agent one who does not intend to get securitieslicensed f. Mortgage Broker g. Estate Planning Attorney basic, for wills and trusts h. Estate Planning Attorney for high net worth clients with an estate tax problem i. Attorney(s) with specialties in elder care, family law, and/or divorce Strategic Partnerships: Defined and Clarified A Strategic Partnership is two professionals united for the benefit of the client AND helping each other. This means that the FA must aggressively look for referral opportunities for your Strategic Partners. That s leverage. Ideally, the person charged with this responsibility is the FA s Relationship Manager. Point #2 in the Relationship Manager s Job Description states: 2) Provide referrals to our Strategic Partners. Naturally the FA is always alert for referrals to Strategic Partners. IF there is no Relationship Manager, add #2 above to your own job description. When meeting with a potential Strategic Partner for the first time, the FA should take on the appointment a printed copy of The Strategic Partner Concept. DO THIS FIRST If not done: From the Document Library, download the Customizable Relationship Mapping RUF. Customize it per the instructions on it. Give it to the CO. Tell the CO: Download and print Relationship Mapping Manual. Follow the directions in these sections: Professional Relationships, For Each Strategic Partner Prospect or Strategic Partner Mass Mail, and For Each Strategic Partner Client. 3
Standard Operating Procedure: Developing Most Strategic Partner Relationships With the possible exception of an estate planning attorney (see following) and residential real estate agent, you will meet potential Strategic Partners by following the procedure below: 1) Ask each client who their advisors are. This means: you ask every client the following question: Script for Asking for Strategic Partners So that I can get an idea of what kind of advice you are getting from your other advisors, it would be helpful to know who they are. This can also help us develop a list of advisors to refer to other clients. Would you mind if I ask you about five key advisors? Let s start with your estate attorney? Who do you use? For your taxes, do you use a CPA or Tax Preparer? Do you have a residential real estate agent you like or even someone you would use if you decide to buy or sell residential property? Who takes care of your auto and homeowners insurance? Any other advisors you are really happy with? 2) Fill out a Customizable Relationship Mapping RUF and give it to your CO. The CO will map the relationship(s). 3) Each month, the CO will print the Relationship Mapping Report. Look for professionals who share two or more clients. Call those using the Potential Partner Script that follows. (Note: you do not have to wait to get two. If a choice client uses a great CPA, get client permission and call them.) Naturally get permission from clients to disclose their names when you call their CPA/ATTY/WHATEVER. Potential Partner Script It has come to my attention that we share at least (# of) clients. I am sure you know (Client 1, 2, and 3). My thought was that it would be an excellent idea for us to get together. Perhaps we can coordinate how we interact. Plus, I m always looking for a good (CPA/ATTY/WHATEVER) to refer to my clients. Tell me, are you in a position to accept additional business at this time? (Response) Lunch on (DAY)? Check out all prospective attorney-partners at www.martindale.com, the online presence of Martindale and Hubble s big legal directory. 4
Prospective Partner Meetings You should have three or four meetings with each potential Strategic Partner, to: 1. Make contact and assess the possibilities of partnering. 2. Demonstrate what your value to the potential partners clients would be. 3. Plan the proper way for both parties to get maximum benefit from the partnership. Meeting 1 This first meeting should take place over lunch. Or you could play a round of golf and pull out your questionnaire afterwards in the clubhouse. Or whatever else makes the interaction partly social and all business. Meeting 2 Take notes on a legal pad. Explain the Strategic Partner Concept. Download this from the Document Library. Take it with you. Interview your prospective partner. Take a copy of our Questionnaire for First Interview. Suggest your prospective partner ask you some of the same questions. Ask enough questions to know that this professional does not sell securities or any competing financial products. You must also ensure that they do not have aspirations to sell these products and services in the future. URGENT: Find out the primary current sources of your potential partner s business. If one is other financial advisors, you might disqualify that person. You are looking for a financial professional who currently receives business from no or very few other financial advisors. If everything looks good, schedule Meeting 2 at your office. Have the potential Strategic Partner come to your office to walk through the entire process that you go through with a new client. Explain they can use fake data if necessary. This helps to formalize how this partnership will work out. If your potential partner doesn t ask questions, or is reluctant to come to your office, they aren t interested; just end the process. It is important that you understand who you will be working with. If your potential partner seems okay at the second meeting, ask for references to current clients and check them out. Also do a public records search, a Google or Yahoo! or similar search, and check with the local professional association and the Better Business Bureau. If s/he passes, set up Meeting 3. 5
Meeting 3 Go to the potential Strategic Partner s office and walk through the process that new clients go through. Again, any reluctance by your potential partner is a warning against pursuing the relationship. If all indicators are still a go, set up Meeting 4. Or, if appropriate, propose: What do you think of the idea of you and I each inviting a half dozen of our best clients to a seminar? We might hold it at the country club. This way, I get to meet some people I don t know, and you do too. How does that sound? If your candidate is not excited about that idea, rest assured that s/he wants a Strategic One-Way Street; keep looking. Event or Meeting 4 At the final meeting to finalize the partnership, or before or after your joint event, explain how you will track Referrals to and from your new Strategic Partner to make sure that nothing is dropped. At this meeting, each partner should bring their key assistant. These are the people that will exchange referrals and set up appointments. It is important they know each other. 6
Special Instructions on Estate Planning Attorneys Background Estate planning attorneys typically do not form Strategic Partnerships. They form strategic one-way streets. You send them referrals; they send you nothing. The reason is that for many or most established estate planning attorneys, their only source of business is referrals from financial professionals. They don t have a free source of referrals to send you. If the attorneys your clients are using don t pan out, look for: A younger estate planning attorney under 40. Most likely their relationships are not yet solidified and they are still building a practice, hoping to make senior partner. Any estate planning attorney who is promoting his or her practice. Very Important Note: Before making a serious search for an estate attorney, it is extremely helpful to have a referral or two in hand. One way to get them is to ask every client who their advisors are. When someone does not have an attorney, ask, Do you need one? A guaranteed way is to send Campaign-FtP-Find The Professionals Letter W Quest. This is a letter in The Letters Library that explains to clients that you are putting together a list of preferred professionals. If they have an attorney they are happy with, please list them. If they need a referral, please let us know. Send the letter. Get some clients who need referrals. Proceed as below. Where to Look 1) Best bet: Get an appointment with a probate judge. Ask for a referral. In some areas, there are special courts that specialize in probate. In other areas, such as Utah, there is no designated probate judge. So you may need to ask an attorney which judges take a lot of probate cases. Probate judges know who the good attorneys are. They may or may not be willing to make a referral. It has happened. One Gorilla reported calling the clerk of a probate judge and asking for an appointment: I need five minutes of the judge s time at the end of the day. I need to refer some clients to an estate attorney, and my thought is a lot of them practice in front of Judge Lastname every day. Five minutes and I m gone. When meeting the judge: I am looking for an estate attorney to refer my clients. The person I m looking for might be on the younger side. I ve found they tend to work harder and faster. I m wondering if you could give me some names I could check out further. 7
Call the attorney with this script: Cold Call Attorney My name is. I m a financial advisor with. I have some clients that need a referral to an estate attorney. Are you in a position to accept additional clients at this time? (Response). I have already looked you up at Martindale.com. You seem to have the skill set I am looking for. But like you, I would have to meet you and feel comfortable before making a referral. Are you open to a meeting, perhaps breakfast or lunch? 2) Look at YP.com. Search for Estate Planning Attorney. See if anyone is advertising wills, trusts, and other similar things. Or if an estate planning attorney in your area is doing seminars, by all means contact him or her. You can also search Martindale.com for those in your area doing Trusts And Estates. Again, you want a youngish attorney and/or one who is promoting. 8
Landing the Right Residential Real Estate Agent You need to find a buyers real estate agent selling at least $10 million a year in residential real estate in the area in which most of your clients live. (That means they are generating approximately $300,000 in revenue, which should put them in your class.) There will be only a handful of these in your area. 1) To find one, call the local real estate board. Tell them you need to refer some of your clients to a real estate agent and would like to interview three of the top buyers agents. 2) Many local real estate boards give awards and the recipients post them on their websites. So you can Google the search strings below plus your city and state plus the critically important term Realtor. (E.g., Rookie of the Year Salt Lake Utah Realtor.) Rookie of the Year Salesperson of the Year Sales Person of the Year Small Sales Team of the Year Large Sales Team of the Year Realtors of the Year Realtors Hall of Fame Realtors Distinguished Service Award Broker/Manager of the Year Buyers Agent Script I got your name from [Source], and I m calling because every year 8 or 10 of my clients sell or buy a home. From time to time, I get asked to recommend someone. So I decided to look for the best in [Name of Area]. But before I make such a referral, I like to meet with these people in their offices so I know a bit more about them. Are you in a position to accept additional clients at this time? Yes. Could we start the process, perhaps with (breakfast/lunch) sometime (this/ next) week? No. Thankyouverymuch for your time! 9
Questionnaire for First Interview with Any Potential Strategic Partner, CPA/Selling Agent/Property Casualty Agent/Mortgage Broker/Family-Law Attorney How many clients do you have? How many (CPAs/agents/mortgage brokers/attorneys) are in your office? What licenses do you have? Designations/Certifications? How long have you been in the business? What is the profile of your ideal client? What is your target market? What services do you provide? What makes you different from your competition? Have you worked with a financial advisor before? If yes: Was it successful? (1 10) Why (not)? How do you acquire most of your new clients? What is your marketing plan? Do you plan on expanding? If yes: How? What is your view on providing financial services? Doesn t now and won t. but might. but wants SP s help. Provides some services. some but wants help. any services. all services. What is your attitude toward insurance products? Is there anything else I should have asked? 10
Questionnaire for Prospective Estate Planning Attorney Strategic Partners Note: This questionnaire was written by an estate planning attorney who works for a major insurance carrier. 1. How much life insurance do you own on yourself? How much on your spouse? 2. What kind is it? (term, group, VUL, UL, etc.) 3. How is it owned? (self, spouse, kids, trust, qualified plan) 4. How are premiums paid? (self, pension, split-dollar) 5. How many ILITs have you set up during the course of your career? How many in the last three years? Are you still recommending ILITs? Do you generally draft your ILITs as grantor trusts? 6. Do you build any flexibility features into your ILITs? What kinds? 5 & 5 Power for spouse Special power of appointment for spouse Trustee discretionary distributions for health, education, support, maintenance Beneficiaries can use trust assets rent free Trustee has the discretion to make fair market loans to grantor 7. Do you have any experience drafting generation skipping trusts? How many have you done? Have you done any generation skipping ILITs? How do you allocate the exemption? (To every gift to the trust that is used to pay premiums.) 8. Are you comfortable with Cristofani ILITs? Have you drafted any? Describe. 9. How do you feel about giving the spouse a right to income in an ILIT when the trust owns a survivorship policy or a single life policy insuring the spouse? What problems would concern you? (Potential inclusion of policy in spouse s estate.) 10. What provisions do you put in your trusts that permit the grantor to directly or indirectly make changes in the trust? ( Trust Protector provision, ability to fire and replace the trustee.) 11. Do you draft family limited partnerships (FLPs)? How many? What discount levels are you generally comfortable with? 12. Are you comfortable with an FLP owing life insurance on the general partner? What concerns, if any, do you have about this? 13. Have you drafted split-dollar agreements for any clients? Explain, describe. 14. What types of split-dollar arrangements are you comfortable recommending and drafting today under the IRS s final regulations? (Endorsement, non-equity collateral assignment, and collateral assignment switching to loans at breakeven point.) 11
Managing Strategic Partner Network You will find detailed information provided in Strategic Partner Process by Rob Rose and Matt Hicken. The Cliff Notes version is: 1) Enter each partner or Strategic Partner as a CG in Gorilla. List=Strat Part Client (has provided FA with a referral). List=Strat Part Pros. FA and other professional are having on going discussions about working together. List=Strat Part MM. FA has not spoken with this professional. Most likely someone used by a client. Not contacted. 2) Track referrals to and from these professionals. Detailed info is in the Relationship Mapping Manual. 3) Periodically re-evaluate the people you support and who support you. If you re working in more than one geographical area, you can have more than one of each type of partner. But you don t want so many partners that you can t adequately help them all as you want them all to help you. 12
Scripts Script for asking for Strategic Partners. So that I can get an idea of what kind of advice you are getting from your other advisors, it would be helpful to know who they are. This can also help us develop a list of advisors to refer to other clients. Would you mind if I ask you about five key advisors? Let s start with your estate attorney? Who do you use? For your taxes, do you use a CPA or Tax Preparer? Do you have a residential real estate agent you like or even someone you would use if you decide to buy or sell residential property? Who takes care of your auto and homeowners insurance? Any other advisors you are really happy with? Naturally get permission from clients to disclose their names when you call their CPA/ATTY/WHATEVER. Potential Partner Script It has come to my attention that we share at least (# of) clients. I am sure you know (Client 1, 2, and 3). My thought was that it would be an excellent idea for us to get together. Perhaps we can coordinate how we interact. Plus, I m always looking for a good (CPA/ATTY/WHATEVER) to refer to my clients. Tell me, are you in a position to accept additional business at this time? (Response) Lunch on (DAY)? Cold Call Attorney My name is. I m a financial advisor with. I have some clients that need a referral to an estate attorney. Are you in a position to accept additional clients at this time? (Response). I have already looked you up at Martindale.com. You seem to have the skill set I am looking for. But like you, I would have to meet you and feel comfortable before making a referral. Are you open to a meeting, perhaps breakfast or lunch? 13
Buyers Agent Script I got your name from [Source], and I m calling because every year 8 or 10 of my clients sell or buy a home. From time to time, I get asked to recommend someone. So I decided to look for the best in [Name of Area]. But before I make such a referral, I like to meet with these people in their offices so I know a bit more about them. Are you in a position to accept additional clients at this time? Yes. Could we start the process, perhaps with (breakfast/lunch) sometime (this/ next) week? No. Thankyouverymuch for your time! 14
Questionnaire for First Interview with Any Potential Strategic Partner, CPA/Selling Agent/Property Casualty Agent/Mortgage Broker/Family-Law Attorney How many clients do you have? How many (CPAs/agents/mortgage brokers/attorneys) are in your office? What licenses do you have? Designations/Certifications? How long have you been in the business? What is the profile of your ideal client? What is your target market? What services do you provide? What makes you different from your competition? Have you worked with a financial advisor before? If yes: Was it successful? (1 10) Why (not)? How do you acquire most of your new clients? What is your marketing plan? Do you plan on expanding? If yes: How? What is your view on providing financial services? Doesn t now and won t. but might. but wants SP s help. Provides some services. some but wants help. any services. all services. What is your attitude toward insurance products? Is there anything else I should have asked? 15
Questionnaire for Prospective Estate Planning Attorney SPs Note: This questionnaire was written by an estate planning attorney who works for a major insurance carrier. 1. How much life insurance do you own on yourself? How much on your spouse? 2. What kind is it? (term, group, VUL, UL, etc.) 3. How is it owned? (self, spouse, kids, trust, qualified plan) 4. How are premiums paid? (self, pension, split-dollar) 5. How many ILITs have you set up during the course of your career? How many in the last three years? Are you still recommending ILITs? Do you generally draft your ILITs as grantor trusts? 6. Do you build any flexibility features into your ILITs? What kinds? 5 & 5 Power for spouse Special power of appointment for spouse Trustee discretionary distributions for health, education, support, maintenance Beneficiaries can use trust assets rent free Trustee has the discretion to make fair market loans to grantor 7. Do you have any experience drafting generation skipping trusts? How many have you done? Have you done any generation skipping ILITs? How do you allocate the exemption? (To every gift to the trust that is used to pay premiums) 8. Are you comfortable with Cristofani ILITs? Have you drafted any? Describe. 9. How do you feel about giving the spouse a right to income in an ILIT when the trust owns a survivorship policy or a single life policy insuring the spouse? What problems would concern you? (Potential inclusion of policy in spouse s estate.) 10. What provisions do you put in your trusts that permit the grantor to directly or indirectly make changes in the trust? ( Trust Protector provision, ability to fire and replace the trustee.) 11. Do you draft family limited partnerships (FLPs)? How many? What discount levels are you generally comfortable with? 12. Are you comfortable with an FLP owing life insurance on the general partner? What concerns, if any, do you have about this? 13. Have you drafted split-dollar agreements for any clients? Explain, describe. 14. What types of split-dollar arrangements are you comfortable recommending and drafting today under the IRS s final regulations? (Endorsement, non-equity collateral assignment, and collateral assignment switching to loans at breakeven point.) 16