Choose Edward Jones--More locations than Starbucks

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Najee's picture
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Incredible Hulk wrote:Ten years with Jones and you never heard Bachmann, Hill or Weddle say we can't help everyone?  My point, again, is that EDJ doesn't try and help everyone.  When you're prospecting on day one, you DO need to talk to everyone that can fog a mirror.  Why?  Because you need practice.Actually, Edward Jones' comment is directed at the fact it feels its business style may not be for everyone -- that's different from saying we don't accept everyone. I can name the countless offices I've visited with useless, small accounts and problematic clients, so that is obviously not the case.You do not need to blindly knock on hundreds of doors and not being able to ask financial questions (which was the case until FINRA changed its rules recently in terms of licensing eligibility). No one ever said you shouldn't prospect (which you seem to misinterpret); Edward Jones' problem is that it is still locked into its 1950s peddler walking-down-the-street schtick so it does very INEFFICIENT prospecting. What is even more ridiculous is Edward Jones has agreements with six companies that provide marketing lists AND EXPECTS FAs TO PAY FOR THEM OUT OF POCKET.The firm does not have quality control training on who does and does not need a financial advisor. Couple that with the firm's Academic Training Leaders and Developmental Leaders -- most of whom have never been financial advisors, or even had sales jobs (a lot of them are former teachers) -- giving impractical advice and training. That "Everyone who fogs a mirror" approach is common even among the veteran FAs, which explains why the typical office has so many "Red" clients and the firm's offices have low assets per household numbers.If Edward Jones had quality control measures in training and implementation, there wouldn't be "Red" clients -- period.

Najee's picture
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B24 wrote:You are correct.  I think by evaluating our "typical" client, they are now trying to measure how many "typical" clients are in a given area.  So I think the focus will be on demographics coupled with wealth, home ownership, age, # of business owners, etc.  I think in the past, they would end up targeting areas that are more affluent that don't necessarily equate to our "type" of client (i.e. Silicon Valley, Manhattan, etc.).  I think you will continue to see more focus on areas with high upper-middle class suburban populations that are not well-served by wirehouses and high-end boutiques.At least it's a start, but to be very honest Edward Jones is at least 15 years too late in this thinking. Not to mention the net is still going to be too big -- the firm needs to target it down to people with specific names and information. Even in a small town, you can have dozens of people that meet that basic criteria.The firm really needs to concentrate on people meeting certain demographic criteria WHO WANT A FINANCIAL ADVISOR. Not only that, the criteria also needs to include people with certain investor behavior and personality traits suitable to do business with the firm.

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B24
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Najee, I think what you wrote is part of it.  They have indicated that they are using very detailed demographic information and market data, and parsing that against our "typical" client.  They are using some of the same data that list services use to - "wealth finders", credit card use, magazine subscriptions, mortgage balances, home values, etc.In addition to avoiding markets that are not typical for us (as stated above, the UHNW areas), they are also avoiding low-income areas that may have a lot of theoretical wealth, but the average wealth per household is low.  Recently I acquired a list of EDJ target sites in my area.  There were several offices slated for my area (which is rather thinly populated), but the next town over has ZERO offices identified, but they have 30,000 more people and more wealth, no EDJ offices, but it is a rather "low-insome" area.  Had they gone strictly by the "old school" demographics, it would have identified lots of potential locations.

N.D.'s picture
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Joined: 2009-07-13

I always wondered why Jones didn't provide a pre-populated list of addresses for FAs to door knock. I mean they have all this data that identifies the area surely they can print off prospecting logs with the addresses already on them and cross reference to disqualify certain addresses. Then the FA can just go down the list. Give them say 200,000 addresses which equals the number of dials a cold caller can expect to dial in the 500 Day War example.

American Flag's picture
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The green color of the Starbucks signs and the green of the Edward Jones signs are similar. The locations even look similar, often in local plazas.

liangliang's picture
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WiredUp's picture
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I love the EDJ commercials... pretty hilarious actually... "If I can meet you in 2 weeks seems ridiculous..." Call into the EDJ office/FA's studio apt office and ask some questions about your portfolio??? Oh wait, he's out door knocking your neighbors and has no idea if the market is open or not. Pretty assinine if you ask me, but hey, why not. But they're there for you watching your money, they just aren't there. Not saying wires are much better bc we CC, but don't pretend to be the only ones that are accessable to your clients. And does EDJ not read about what happened to SBX? They opened so many locations that they actually had to shut down a ton of them (600+ I believe). I'm glad I live in a city so there's less Jehovah's Witnesses thumping at my door spilling Kool-Aid on my new floor mat outside. JK, I've actually never really even run into an EDJ's rep when prospecting or their clients more than 1-2x a year. Like I said, I live in a large city where you'd get shot in the face if you DK's the wrong street. Literally 2 blocks away from the nice areas. And in the suburbs you can't throw a stone in any direction and not hit 150 RIA's or Wires.

Kaner's picture
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Joined: 2010-06-17

I would guess it has something to do with those that are unhappy being more likely to respond than those who are happy. 

American Flag's picture
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Joined: 2010-05-03

Kristen, you know why. You read this forum. Right? 

Spaceman Spiff's picture
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I think it has everything to do with all of the changes we've seen the past couple of years.  We've had no changes to compensation or perks, which I would assume means diversification trips, so there shouldn't; be any complaining about that.  Our benefits haven't changed fundamentally, except for the cost which has gone up every year I've been here.  So that's nothing new.  We have more products and services to offer clients with, in my opinion, plenty of service and sales support to back it up.  Those have been positive changes for our clients, but it does take away from the traditional EDJ culture.  When you start to resemble a wirehouse those folks who like the anti-wirehouse culture aren't going to give you really high marks.  Jones is changing, that's for sure.  People don't like change.  The production requirements haven't even come into play yet.  They don't start until January.  They really shouldn't affect that much of the Jones population. But they weren't very well received.  The timing certainly could have been better.   Was this the first year the survey was done online through the magazine's website?  In the past did you send out emails or paper surveys?  I'm just wondering if the way you did the survey had anything to do with the responses.  Because if you left it up to the people who are coming to your website to do the survey, you're probably not going to get the true feelings of the majority of Jones FAs.  I wouldn't really call the 20 or so folks on their way to the forums via the home page a true random sampling.   

N.D.'s picture
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Why not Spiff? You think only disgruntled employees visit the website? Or only disgruntled employees come back to the website after they get what they need?I can't imagine an online survey having bias toward the disgruntled?

Kaner's picture
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From what I have read, the production requirements only  affect a small number of FA's.  That could have an impact on the survey, but still, it's a small number of FA's.  And how many of those are responding to the survey?  Maybe, like I said, it has something to due with the unhappy ones voicing their displeasure.   

youngbuck's picture
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I have no axe to grind.  I don't work for Jones.  I never have.  I have nothing against them.  What surprises me about people who knock on Jones knock on them like they are any different from any other financial institution.  They hide information from their field?  Are you kidding me?  You think that MSSB and BofA/Merrill were upfront in their dealings?  Previously I worked for bank.  Talk about walking blind.  You never knew what direction the bank was going to take.  They were like lawyers.  Their lips were moving, they were lying.  EJ doesn't provide leads lists to their field? Really? Who does? It sounds like Najee wanted a list of qualified investors without having to do any prospecting himself.  Assets, willingness to work with him etc.  Dude, if they had that they wouldn't need you!  They could get by with some other shmo.  No matter what firm we work for they expect us to have prospecting skills.  If we can't get the job done they will try to find someone who can.  A firms job is not to find assets and clients, its ours.  If we can't do it than we're not profitable.  Advertising "we'll be there for your call?" Really? As another one of you said you're cold calling or on the course.  But, no matter what firm you're at you will answer that call ASAP because they are your client.  Maybe my MS broker turned down my invitation for him to be at my daughter's wedding and give a toast, is that all the sudden false advertising because of their commerical?  Give me a break!  Why doesn't your baby talk about the stock market!  We're going to arbitration.  It's a commerical.  A lot of companies give you a cube instead of an office.  EJ I am sure has positives and negatives.  Don't be upset with a firm because it's not your exact model, didn't provide leads for you, or you couldn't make it.  Move on.  Your  old clients have.  You might as well too. 

American Flag's picture
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"Maybe, like I said, it has something to due with the unhappy ones voicing their displeasure. " Kaner, that's the second time you said this and it still makes no sense.As Kristen said, the results are different than past surveys. Her point is something has changed.  "Unhappy ones" could have "voiced their displeasure" in past suverys. They didn't. Her question is, why are they now?  

Kaner's picture
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Flag - First she says the results are down "significantly."  Then in a later post she indicates, "the ratings the firm got weren't THAT much lower this year."  So, which is it?  If they were down significantly then there may be more to it. OTOH if they were more like her second comment, I would attribute it to the increase in production standards.  The small number of FA's who are effected by the increase may have never responded to the poll in the past.  And thus, are now more likely to indicate their displeasure.    I'm not trying to say I know this to be a fact, it's just my observation.

N.D.'s picture
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Joined: 2009-07-13

If thats the case then the IRs above the new levels not effected would more likely be glad EJ is raising the standards since it is likely going to help with LP/GP and Profit Sharing(if these are different things, I am not at Jones)

N.D.'s picture
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How about over dinner? Say my place around 8ish?  p.s. congrats on the promotion!

American Flag's picture
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SuperMan's picture
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This is JMO but at Jones our fixed income space is so limited it's probably impacted many vet advisors in a negative way.  Other firms seem to have more in the way of bonds, CDs, and fixed annuities and we are handcuffed to the Jolly Green Giant and his offerenings.  Tough to compete.Also, fall regionals were cancelled and production quotas were raised.  At Jones, we are so decentralized it seems like we are on an island alone.  Culture is not built by yourself but with others.  Of course maybe they are just unhappy with all the recruitment e-mails we get?As for me, the firm is the same place it was when I joined.  No better, no worse.  Just know some guys have seen lots of changes and that makes it hard to stomach. I'm sure the LP calls have made the vets very very happy and if you did the results today they might be different.

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SuperMan wrote:This is JMO but at Jones our fixed income space is so limited it's probably impacted many vet advisors in a negative way.  Other firms seem to have more in the way of bonds, CDs, and fixed annuities and we are handcuffed to the Jolly Green Giant and his offerenings.  Tough to compete.Also, fall regionals were cancelled and production quotas were raised.  At Jones, we are so decentralized it seems like we are on an island alone.  Culture is not built by yourself but with others.  Of course maybe they are just unhappy with all the recruitment e-mails we get?As for me, the firm is the same place it was when I joined.  No better, no worse.  Just know some guys have seen lots of changes and that makes it hard to stomach. I'm sure the LP calls have made the vets very very happy and if you did the results today they might be different. Fall Regionals were cancelled???????  I just back from mine.

Advisor238's picture
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As for the surveys, I would bet that the higher production standards may be playing a part. I have noticed that at our regional meetings there hasn't been as much enthusiasm. I think some FA's are having a hard time in this economy and that with the higher standards they are seeing the handwriting on the wall.I haven't taken the survey, but I am quite happy with the direction EDJ is going. Since, I started with the firm in 05, there have been multiple changes and improvements. Financial Assessment Tools, New Bond Trading Platform, New Equity Trading Platform, Relationship Manager, Portfolio Builder, Advisory Solutions, etc......     I think Weddle is moving our firm in the right direction.

FA86's picture
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Joined: 2010-05-21

10-15 year guy who's used to be ok with a T12 in the ballpark of 200-250k is now feeling some heat under his seat.

youngbuck's picture
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Joined: 2010-03-05

FA86 please expound.

LockEDJ's picture
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Joined: 2009-07-06

Simple, isn't it youngbuck? $18-20K a month doesn't cut it at Edward Jones anymore. Minimum standard moved up.I'm guessing there's about 2000 advisors at Jones that are realistically semi-retired and not even working 30 hours. They are putting out $20K a month, keeping $80K, golfing a bunch and once a year combining their best months so they can get one div trip a year and take the wifey someplace special.A nice gig if you can get it, but Jimbo Dub just put the cabosh on it. Which means EDJ is either going to replace 2000 vets or generate more income from existing resources.

FA86's picture
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Joined: 2010-05-21

Look, there are brokers out there who either joined the business in their late 40's or in their 50's and came to Jones because Bob their broker saw some potential in them and needed to qualify for the div trip. This guy (or gal) was happy grossing 15-20k a month and generally had things on autopilot. Sure they weren't cashing huge checks but life wasn't too bad. Now there's pressure. Some folks don't like it. I'm not saying Jones erred by going down this road but for those who flew under the radar doing so just got a little harder.

Spaceman Spiff's picture
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Joined: 2006-08-08

While I agree with you that some of those folks are a bit disenfranchised with the changes Jones is making to the performance standards, I also agree with Jones that there are a lot of reason why the standards needed to be raised.  Those guys who are  happy grossing $15K should seriously consider joining a local indy firm, getting the higher payout, and putting more money in their pocket for the small amount of work they want to do.  I was around when the standard went from $15K to $18K.  Jones caught the same kind of flack back then too.  But you know what happened?  There was a little bit of turnover, but most of those guys that were flying just above that $15K number figured out a way to bump it up to $18K.  So now they're making an extra $14K year.  And they're probably not working much harder than they were before.  They'll figure out a way to get up to $20K again and they'll be making an extra $9600 a year.The other way to look at this is to compare it to a normal job where there is a cost of living increase every year of let's say 3%.  How pissed off would you be at your employer if for the last 5 years they didn't give you a raise at all?  Most people would go find a different place to work.  Jones doesn't give us raises.  We give them to ourselves.  So, if you were doing $18K a month 4 years ago and you wanted to give yourself a cost of living raise every year, you'd be over $20K today.I don't know about most people, but I didn't get into this gig because I liked a stagnant paycheck.  These last couple of years where I didn't go up that much on my 12 month gross were a little depressing.  I'm happy to say that this has not been one of those years.  I'm looking at about a 30% increase over last year.  I'd like to raise it again by 30% next year.  So, while I can understand the frustration of being told what you're doing used to cut it, but isn't going to any longer, I just don't see how anyone can argue against making more money. 

American Flag's picture
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Joined: 2010-05-03

.

American Flag's picture
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N.D. wrote:How about over dinner? Say my place around 8ish?  p.s. congrats on the promotion! ND, this is the Reg Rep Forum equivalent of a construction worker whistling at a woman passing by, and my guess is will prove about as effective. :)

N.D.'s picture
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American Flag wrote:N.D. wrote:How about over dinner? Say my place around 8ish?  p.s. congrats on the promotion! ND, this is the Reg Rep Forum equivalent of a construction worker whistling at a woman passing by, and my guess is will prove about as effective. :)haha yeah it was a no go... this time

American Flag's picture
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You can say you tried.

Najee's picture
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Joined: 2010-08-25

youngbuck wrote:EJ doesn't provide leads lists to their field? Really? Who does? It sounds like Najee wanted a list of qualified investors without having to do any prospecting himself.  Assets, willingness to work with him etc.  Dude, if they had that they wouldn't need you!  They could get by with some other shmo.  No matter what firm we work for they expect us to have prospecting skills.  If we can't get the job done they will try to find someone who can.  A firms job is not to find assets and clients, its ours.  If we can't do it than we're not profitable.1.) Edward Jones has arrangements with SIX companies that provide marketing lists for qualified people, whose information has been scrubbed by those marketing firms. The thing is Edward Jones does not make it commonly known to its FAs and then charges the FAs for the lists if they are ordered through these groups. That's insane, particularly for a company that claims to put so much money into training its FAs but yet won't help its FAs bring in business.2.) Most professional sales organizations in other industries do provide lists and contacts, so I guess that means the financial services industry needs to learn more about professionalism and making their employees more efficient.3.) You sound like someone who is more interested in being a slave for another company and doing its blind bidding. It's not that people don't want to do prospecting, but to make it MORE EFFICIENT AND EFFECTIVE. You can't expect people to go blindly knocking on doors, particularly in a day and age of restricted neighborhoods, Do Not Call lists and (in a much worse case) the potential for being attacked. You're now delving into potential legal problems now.Seriously, if you're going to do all the heavy lifting for a company and getting marginal reward for doing the company's work it sounds senseless to me. You would be better off doing your own thing rather than a company's bidding while it's taking the bulk of the money.

Najee's picture
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Joined: 2010-08-25

LockEDJ wrote:Simple, isn't it youngbuck? $18-20K a month doesn't cut it at Edward Jones anymore. Minimum standard moved up.I'm guessing there's about 2000 advisors at Jones that are realistically semi-retired and not even working 30 hours. They are putting out $20K a month, keeping $80K, golfing a bunch and once a year combining their best months so they can get one div trip a year and take the wifey someplace special.A nice gig if you can get it, but Jimbo Dub just put the cabosh on it. Which means EDJ is either going to replace 2000 vets or generate more income from existing resources.Even if that is true, you're not describing the typical Edward Jones financial advisor. That's the profile of someone with a book much bigger than the typical FA's, one so big that the production standards are met when the FA opens the door on the first day of the month. The median AUM for an EJ office is somewhere around $25 million to 30 million AUM, and that is not nearly enough to coast in such a manner. Just call Edward Jones' raised production standards program what it is: a forced attrition program. The average revenue per FA per day is somewhere around $650 as of October, which means the typical FA is not close to making the current production standards. Now, the firm is raising its production standards 22% over the next two years.The newer FAs will wash out at an even higher rate and you will see a good portion of the Segment 3 and Segment 4 FAs will wash out. Also, the firm is hiring fewer candidates, so that means fewer replacements for those empty offices. In my former region, there are two $20 million-plus offices open with no replacement in sight (one office has been open since late September, which means it has less than 30 days to be filled or it will be closed). I will be a bit surprised if either office is filled, and instead the assets will be split among another office or offices in the area.Add that up, and it's very apparent that Edward Jones wants to consolidate offices and get rid more than 10 percent of its sales force. A LOT more than 10 percent. The people you're alluding to are essentially the Segment 4 FAs whose production has been hampered the past two-plus years -- so if they may be on the chopping block, what do you think the attrition rate for the lower level ones will be?

down the road's picture
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Joined: 2010-05-15

LockEDJ,   you hit the nail on the head. I was a average Seg 4, and I didnt want to be concerned if my rolling 4 fell below a number I had 4 months to put up numbers or be terminated. I am now at LPL and other than bills and business expenses I have no numbers.

Advisor238's picture
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Joined: 2009-02-25

Najee, when you are saying the typical EDJ office is 25 to 30 million AUM, you are including newly opened offices etc.... This doesn't give an accurate picture of the typical EDJ vet's office that has been opened 5yrs plus. I have been out 5yrs and I am at 50 million AUM. If I looked at my region and weighed out the average office size for Vets who have been out 10yrs or more, I think the average would be slightly over 100 million AUM.

SuperMan's picture
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Joined: 2010-09-18

Or the FAs move their exisiting books in Advisory and work a touch smarter and keep their jobs.  It's amazing what people will do to eat.

stockguy's picture
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Joined: 2008-05-07

If your region's average AUM is $100 million why is there not more million dollar producers? Most other firms advisors average 85 bps on assets. When I was at the green machine our RL had $350 million and did $1.2 mill. That's the issue with Jones. Well one of them anyways.

SuperMan's picture
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Joined: 2010-09-18

Stupid question... Jones brokers sold A shares for 30 years.  Figure it out. The path is changing and the profit of the firm will explode soon.  Your silly arguments about this will be moot 10 years from now.

Spaceman Spiff's picture
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Najee - Jones doesn't provide lists of names to people because it's an excercise in futility.  They'd rather you do what they have figured out works really well, doorknocking and asking for referrals.  They're not against their FAs cold calling like the rest of the world, but they're not going to encourage it.    They do have vendors that they've worked with for many years on our systems with the ability to run the cost of the list through paybills.  That's a bit different than the cost of those lists going through your P&L.  Paybills comes out of your pocket, P&L comes out of Jones' pocket first then, if you are bonus eligible, would reduce your bonus for that expense.  It's not some super secret thing that they only give to the special guys in the club.  And you don't have to qualify for anything to get the lists.  You just have the cash to pay for it and be smart enough to know how to search for the names of the companies on Jonesnet. 

phever's picture
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Joined: 2010-08-12

The question I have, with 70% of households in the US living paycheck to paycheck, where are new clients going to come from? There are only so many clients with enough to invest, and that number is getting smaller. Over half of current retirees depend on social security for their main source of income, and the average 55 yr old American has less than $50,000 saved for retirement. Financial advisors are growing faster than clients.

Spaceman Spiff's picture
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They're going to come from the places they've always come from - inheritances, good savers, bad savers who roll over their 401k, etc.  We're in the midst of one of the largest transfers of wealth in history.  Those Greatest Generation folks are/were good strong savers.  They learned to save a little for a rainy day, which has turned into hundreds of thousands sitting in their bank and brokerage accounts.  Their kids are about to inherit that wealth.  I've also seen a decent interest in the grandchildren of that generation to save money.  They've seen the way their parents have squandered their paychecks and are now having to work into their late 60's and 70's and they have no interest in that.  They start out small, but those accounts will eventually make it to the books of all of the FAs out there.  I think you need to further dissect the "averages" that get thrown around.  While it may technically be true that the average 55 yr old has $50K saved, that doesn't mean that all 55 yr olds only have $50k saved.  It's an average.  My guess would be that there are a bunch of people who have around $50K saved, some with $250K saved and some with $0 saved.  We're not interested in the last group, but we can help the other two.  We all WANT the $250K account, but most of us will take the $50K account, put it in something easy to manage and do the best we can for them.  A couple hundred $250K accounts in some sort of fee based business will make most FAs pretty successful.  Throw in a couple hundred $50K accounts and you're one of the best paid people in town. 

SuperMan's picture
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Joined: 2010-09-18

Those are true words.

BeenThereDoneThat's picture
Joined: 2010-05-26

I'm surprised that Jones hasn't put multiple advisors in one office. The economy of scale makes a lot of sense. Gene Hines and Joe Alcott have had a two-man Jones office for decades in Ponca City, Oklahoma. Their styles work well together and they are very successful. When I was with Jones they were just starting to put more than one advisor in small towns. When I walked into the Jones office in my town to introduce myself as a new Jones advisor in town, the other investment advisor was ticked off. He thought I was invading his turf. The simple truth is a majority of high net worth investors would rather work with a team. I think you'll eventually see Jones move to larger branches.

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