Despite the stock market’s recent strength, the brokerage business has a hard time pulling in revenue like it once did. The national Do Not Call list prevents brokerages from cold-calling people who don’t want to be bothered. Plus, competition has forced brokerage fees lower. That makes it more difficult for individuals to earn good salaries off small accounts.
Brokerage firms face a lot of uncertainty right now, but one firm knows exactly what to do. It sticks to old-fashioned ways by sending its representatives door-to-door instead of picking up the phone and making phone calls.
Edward Jones is a St. Louis-based firm with a 91-year history. During a time when most firms are cutting their staff sizes, Edward Jones hired 2,682 trainees in 2012. The company plans to hire about the same amount of trainees in 2013.
These trainees learn about the brokerage business differently than most people. They attend training sessions in offices designed to look like living rooms. The space represents the kind of homes that they will visit while reaching out to potential clients. Trainees get videotaped while role-playing so they can watch the tape later to see where they could make improvements.
This approach to selling stock takes a toll on employees. Hiking through Atlanta suburbs on hot summer days can take a lot out of a person, especially when that person’s wearing a suit.
Some trainees don’t make it through the program either because they don’t like the work or they don’t make enough money doing it. While some individuals might not succeed, the company pulls in more money than most of its competitors. Jones Financial, the parent company of Edward Jones, has seen revenues grow by 42 percent over the last three years. Merrill Lynch has only seen 10 percent growth.
That doesn’t mean the Edward Jones approach of going out and knocking on doors is the future of brokerage firms, but it’s an interesting concept that has kept the firm busy.
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