How to improve profits in the small case market

Most brokers do not make a profit in the small case market because they don’t properly leverage technology or employ best practices.

In a session at EBA’s Workplace Benefits Renaissance in New Orleans on March 2, Maureen Liberati, an independent consultant at CBP, and John Ollis, VP of sales and marketing at IBX, will share how a broker’s small case business “can be their most profitable business segment within the employee benefits business,” Ollis says.

“Very few advisers, if any, ever hear that the small case segment can be very profitable,” he adds. “Most firms we talk to are really struggling with how to handle this business — and most are walking away from it.”

Ollis hopes advisers walk away from the conference session with an “understanding that there are a number of options available to them to improve their margins significantly,” he explains. “This applies not only to small case, but their entire block of employee benefits business.”

Beyond top line growth
Employee benefit firms, he adds, focus primarily on growing the top line, but they should also focus on the bottom line. “Through expense reductions and improved efficiencies, firms can have a dramatic impact on their business,” he says. “I would really like for folks to understand that every dollar of expense reductions flows right to their bottom line, while only 20%-30% of new revenue hits the bottom line. The leveraging effect of expense reductions is significant.”

The session will give attendees a number of ideas relative to improving back office efficiencies which will increase profits and improve key employee retention.

“We will also help people to put structure around how they approach the operational side of their business,” he says. “Advisers are being bombarded with new technologies — CRMs, enrollment engines, Zenefits solutions etc. — and we will provide some step by step advice as to how to approach tackling some of these issues. “