Just try to keep up with the Joneses
Edward Jones is expanding in the metro area.
The firm currently has 84 branches and 94 financial advisors in the Grand Rapids region, which includes Kent, Ottawa, Muskegon and Allegan counties, and its goal is to add 11 more branches over the next year and 25 over a three-year period.
“If you look at the financial-services industry during this recession, the industry has actually shrunk by about 41,000 financial advisors, and that’s from the consolidation, the downsizing and things that have occurred overall. But during that time, Edward Jones has grown 25 percent as a firm — but in West Michigan, we’ve grown over 50 percent,” said Miller, who has been with the company for 23 years.
Miller said the regional growth here has largely come about because the firm has been very focused on its clients, and because it practices a more conservative philosophy than most others in the field. He categorized that philosophy as a buy-and-hold type and one that appeals to investors here.
Those company characteristics have allowed the firm to take advantage of a situation in the market.
“I think, over the last few years, especially, what’s happened is, with the baby boomers retiring — and that’s certainly been the case in West Michigan — and with a lot of the downsizing that has occurred with some of the companies, people have found that they really do need some professional advice. And they’re seeking those people out at a time when a lot of firms are shrinking. You see a demand for financial advisors when there are less of those individuals out there,” said Miller.
“So we found this a very, very attractive market to expand,” he added.
Miller said growing while others have shrunk points out that Edward Jones has a different attitude in what it does, and that business approach matches the firm’s structure. The company is a partnership rather than a corporate entity, and Miller said Edward Jones looks at the long term instead of the short term when it comes to investing.
“We’re not looking at the next quarter. We see this as a great opportunity to capture additional market share, where others are looking at it as they need to cut back expenses, and that really creates a great opportunity for us,” he said.
More branches, of course, means Edward Jones will need to bring on more financial advisors. Miller thought the firm would hire an additional 35 advisors over the next few years. He said the company would look to hire individuals with industry experience to fill the new branches, but will also consider applicants who don’t have that background.
“We have former teachers, former auto-industry executives, people who have left other industries. We have a very good training program, so we’re really looking for people who are more entrepreneurial, to where they want to run their office and are able to build their business. It doesn’t have to be somebody that’s from the industry, and we’d certainly love to look at those people,” he said.
The Edward Jones training program begins with applicants studying for the regulatory exams: a Series 7 licensing exam and a Series 66 exam. Passing the first gets someone a license, while the second qualifies that person as a financial advisor. There is also an insurance licensing exam. Then the actual training as an advisor begins, and it continues after someone is hired. “It’s quite an extensive program over a number of years,” said Miller.
“Our firm has the highest-pass ratio of the regulatory exams that are out there. I think that’s due to the fact that when somebody is hired by our firm, we have dedicated people that are working closely with them, and then we have a training program where those individuals are in the field in branches with veteran financial advisors. We take them through those processes, and our attrition rate is lower than the industry as a whole because we have more hands-on type of training,” he added.
Miller said the expansion is underway and so is the hiring process. He pointed out that what is helping the recruitment process is the fact that Fortune magazine ranked Edward Jones No. 11 on its current list of the 100 Best Companies to Work For, and the Detroit Free Press endorsed the firm as being the top financial advisor in the state.
“I think we’re getting a lot of attention in that respect,” he said. “It’s a great time to be ranked that highly.”