![Show Menu](styles/mobile-menu.png)
![Page Background](./../common/page-substrates/page0040.png)
31
2007 Best Practices Study | Agencies with Revenues Between $1,250,000 and $2,500,000 | Executive Perspectives
Appendix
Insurance
Carriers
Technology
Service
Staff Info
Producer
Info
Employee
Overview
Financial
Stability
Revenues/
Expenses
Executive
Perspectives
Profile
Agencies with Revenues Between $1,250,000 and $2,500,000
Keys to Their Success
To quote management guru Tom Peters, when asked
to identify everything you need to know about
strategy, “It’s the people, stupid.” Perhaps no other
“success factor” is rated more highly or consistently in
this study, regardless of agency size. Great insurance
agencies employ great people – great leaders, great
sales people, great support staffs. This is true of all
Best Practices agencies – recruiting, hiring and
retaining the best talent available remains the most
fundamental distinctive.
This “people investment” is significant – the average
agent in this group devoted 57.9% of net revenue to
compensation and 56.7% of agencies plan to hire at
least one new producer this year.
New business results for this group speak to the
quality of the sales professions employed – the
average new business results, per producer, totaled
$83,994 (commercial P&C producers), $36,674 (life &
health producers), $42,293 (personal P&C producers)
and $71,634 (multi-lines producers). Likewise,
support personnel in this Best Practices group score
very high in terms of average business serviced per
CSR - $294,719 (commercial P&C CSRs), $220,803
(life & health CSRs), $155,214 (personal P&C CSRs)
and $247,760 (multi-lines CSRs).
Top Challenges
Finding the right people continues to be a challenge
for Best Practices agencies. As one agency owner put
it: “It used to be, our biggest issue was finding and
developing young producers. That’s still an issue and
it probably always will be. But now, we’re also having
a really tough time hiring good support people.
Finding well-educated, intelligent and motivated
employees, even those we’re willing to train from the
ground up, is really tough for us.”
Market conditions continue to provide challenges as
well. The ongoing soft P&C market and marketing
issues on coastal exposures were identified by many
agents in this group as primary challenges. As a result
of these and other issues, the average agency in this
group grew organic revenue by 10.4%, the same rate
achieved in the 2006 Best Practices Study. With the
current soft market, a common refrain is “we have to
sell a lot of insurance just to stay even.”
Maximizing Productivity
Productivity metrics for these Best Practices agencies
speak to a very high level of productivity: the average
revenue-per-employee for this group totaled
$144,801, a level formerly reserved for much larger
agencies. Technology and procedures standardization
are two issues often noted as the reason for these
impressive productivity results.
Consolidation continues in terms of agency
Factors Most Critical to
Agency’s Success
(Top 5 Listed in Order of Frequency Mentioned)
1. The quality of our employees
2. Our markets (aggressive, available
and competitive)
3. Service focus
4. Our use of technology
5. The quality of our clients
Top Challenges
(Top 5 Listed in Order of Frequency Mentioned)
1. Finding the right employees
2. Finding talented producers
3. Carrier relations / soft market
conditions
4. Company consolidation
5. Developing a sales culture