The concept of advisors working in teams isn’t new, but facilitating that practice across North America indicates a sea change for wealth firm Edward Jones.
The firm traditionally has operated single-advisor offices run by an advisor and office administrator, and that model remains. But increasingly, the firm’s nearly 19,000 advisors across Canada and the U.S. are seeing multi-advisor locations pop up.
Edward Jones has 850 advisors in Canada who manage $52 billion, and the firm has opened 85 multi-advisor locations across the country that can house at least two (and as many as six) advisor-administrator duos, said David Gunn, president of Edward Jones Canada. He oversees more than 2,300 staff comprised of advisors, branch office administrators and associates.
Those group offices were rare even three years ago, he said, noting that the Canadian arm had approximately 780 advisors in Canada and $30 billion in assets in 2018.
There are several reasons for the shift.
“Through the pandemic, client preferences changed; we’re seeing in general that clients are preferring about 30% of their meetings in-person and 70% virtual,” Gunn noted. “That’s allowed us to have multiple advisors in a branch who share real estate.”
That comes with “an economic benefit,” he said, since offices for single advisors were traditionally larger than 1,000 square feet.
Reducing the total number of offices means Edward Jones has been able to put its “significant” savings toward key areas such as technology investment, brand campaigns and product development. (The firm didn’t disclose the amount it had saved.)
Still, the change in offices hasn’t meant shrinking its overall real estate footprint, Gunn said. Rather, “it’s allowed us to enter into areas where we historically couldn’t,” since leasing small offices in major centres such as downtown Toronto was difficult.
And the timing has been good: “Pricing for office square footage in many of these city markets has reduced significantly in the past few years.”
In the coming year, Gunn said, 34 additional multi-advisor branches will open in locations such as Calgary, Ottawa, Fredericton and multiple cities in British Columbia. Most will house two advisors and their administrators, with six offices in those top markets designed for at least three advisors.
Gunn hopes this will further enable greater advisor collaboration and networking.
“When a client phones a branch, we want to make it as efficient for the client [as possible],” Gunn said. Not only can investors reach one of several advisors at these new locations, but they also house licensed administrators who can accept trades.
“That’s a big shift for us, too,” he added, saying the practice has been implemented for single-advisor offices as well. Edward Jones has also added 20 registered branch associates in Canada this year, and may add entry-level associate advisors in 2024, depending on the success of their efforts to do so in the U.S.
This “unlocks that teaming concept,” Gunn said, predicting the firm’s advisor teams will start looking “very different” in the next two years.
More Edward Jones advisors have been asking for better opportunities for education and about succession planning — all of which are easier in a multi-advisor setting.
Especially among advisors with different niches (e.g, the agricultural community or business owners), there has been “a significant benefit” from idea sharing, Gunn said.
Of great importance to Edward Jones is how many advisors seek designations in the years to come. Forty-two percent of its advisors in Canada have a designation, such as the PFP, QAFP and CWIM, and 22% hold the CFP.
“We have 150 advisors enrolled for a new designation,” Gunn said, exceeding the firm’s target of 100 individuals for this year. “Clients want these deeper conversations and they’re asking [about designations],” he added.
The firm noted in an email statement that it originally wanted its advisors in Canada with designations to hit 50% by 2025. However, it’s reviewing “what a healthy growth rate for new certifications should look like” as well as the advisor support required.
Into next year, the firm will encourage advisors to seek financial planning designations approved by the Financial Services Regulatory Authority of Ontario.