Agency Ownership: 3 Elements to Consider
This post is part of a series sponsored by InsurBanc.
Young agents are the future of the independent agency system, and their path to agency ownership can be challenging. Make sure you understand what you are facing as you walk down this path and consider the following three assessments of your readiness.
1. Financial Preparation
Are you a qualified buyer? Are your personal finances in order? Good FICO scores and credit bureau repayment history are strong indicators of your ability to obtain capital and repay debt. What’s your willingness and ability to assume risk and debt?
2. Emotional Preparation
Try to take your emotions out of decision making. Be honest with yourself and understand your role in an organization. Can you become part of the agency’s succession plan? What will you have to offer? Concentrate on building a book of business, establishing carrier and client relationships and client retention.
Are you and your family on the same page about incurring debt and making short-term sacrifices ― like trading in the fancy car or taking less expensive vacations ― to ensure long-term success as an agency owner? Owning and operating an agency takes effort, time and investment.
3. Operational Preparation
Do you have the skillset to manage the daily operations of the agency while focusing on long-term growth initiatives? Will you embrace technology to increase operational efficiencies? Can you distinguish between colleagues and employees? Do you understand the capabilities of an agency management system?
You have enjoyed success under the umbrella of your employer. But will you be able to make the necessary decisions to develop employees, maintain carrier appointments and manage the agency’s financials? Can you successfully transition from employee to management?
You’ve got opportunities to pursue and decisions to make as you set on your path to agency ownership.
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