In September, the FOX Wealth Advisor Council convened in New York to discuss the latest FOX research, benchmarking and best practices for advisors serving single family offices. Many issues – from talent acquisition to profitability – were raised by Council members as key industry challenges. Perhaps surprisingly though, client acquisition was not among them. In fact, many of the firms represented have been quite successful in obtaining additional, as well as increasingly larger, clients.

Instead, the following issues were cited by the majority of members as being the most challenging to their business:

• Determining what services to offer
• Setting appropriate pricing strategies
• Acquiring talent
• Integrating services effectively

While each of these topics raises its own separate concerns, all four are distinctly related in that they are more matters of supply than demand. It seems the questions most firms are grappling with is how to effectively serve the needs of both more and increasingly larger clients – while developing a profitable, scalable and sustainable business.

These findings are reflective of a larger trend we’ve seen with wealth advisors all over the world through our active Wealth Advisor Councils in Europe, Australia and the United States. Furthermore, we’ve found that the manner in which firms choose to address these challenges will often determine their profitability for years to come. Firms can overcome these growing pains by developing a compelling and disciplined growth strategy. On the other hand, opportunistic development without a thoughtful plan will often lead to scope creep, increased complexity and unsustainable growth.

A perfect example of this challenge is a firm’s client selection strategy. Thoughtful client selection should result in a compelling match between a client’s needs and a firm’s offerings. However, an attempt to be too many things to too many people will lead to a lack of focus and scattered service. In most cases, client selection is the best predictor of profitability.

To address these types of issues, our Wealth Advisor Councils meet regularly to share best practices, knowledge and industry insight. Is your firm facing similar challenges and opportunities? If so, please comment below.