how low can this go?, page-45

Obviously some dealer groups will survive and have a piece of the pie, there is always going to be some level of demand for advisers who don't want to have to deal with all those bits and pieces themselves as you have identified... However, those dealer groups simply have their margins being squeezed.

The overall 'pie' is also reducing significantly. This is critical as dealergroups not only need profitable advisers, they also need a large number of them if they are going to make less money for each one. A lot of advisers right now have been 'successful' not from being a good adviser and building a client base organically from adding value, but from simply buying books of clients from others and not servicing those clients. This has been possible due to grandfathered remuneration (clients don't need to continually resign to continue to pay fees, some don't even know they are paying one). This has lead to many advisers having 1,000's of clients each of which they clearly cannot actually service and add value too, yet they still get paid. In future, I see this being abolished and every clint being subject to opt-in, which is essentially needing to resign a fee agreement every 2 years or fees get switched off. This means that advisers will need to actually service every client in order to get them to resign to pay fees (as they should) and ultimately a big reduction in average clients per adviser to less than 200 I would imagine. While that isn't a dealer group specific issue, that does mean a lot of advisers will simply sell up and leave the industry as they cannot be bothered studying further and actually servicing their clients, the gravy train is over where an idiot with money can just buy a book of clients and live off the trail.

Advisers are leaving vertically integrated firms in droves (those who provide both advice and manufacture product - shouldn't have been legal in the first place as they use "advice" to simply sell). One of the dealer groups that were picking up a large number of advisers from vertically integrated firms (Banks, AMP, IOOF etc) was Dover. They recently got shut down by ASIC due to the 'client protection policy' which was essentially just indemnifying the dealer group from any client claims.

I personally see that eventually advisers will be self-licensed (thats how it used to be). You don't get licensed by the firm or dealergroup you work for and potentially be restricted to what they want, everything falls on you. There will be far less advisers but the general quality them will be much higher, especially after an exam and degree prerequisite.

Hope that helps! On the subject of IOOF and Colonial, IOOF isn't that different to AMP IMO. Vertically integrated and just bought the basket case of ANZ financial planning. I wish I shorted IOOF when I did AMP and Colonial ill be considering shorting as well depending on what valuation it commands after the split (count and financial wisdom IMO would have already have been sold if they were attractive).

Essentially none of the vertically integrated firms offer something that isn't attainable elsewhere at the same quality but at a cheaper cost. BT did however just drop their platform cost considerably and that is going to hurt everyone else by them either needing to reduce fees also or suffer outflows.

Keep in mind this is all IMO only, I am not the source of truth haha.