2019 Best Practices Study

Definitions

Sales Velocity

Age Banding of Sales Velocity

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Sales Velocity is a critical metric in determining organic growth. It is defined as this year’s written new business divided by last year’s commissions and fees. Age Banding of Sales Velocity can help a firm assess where new business and growth are coming from and prepare for perpetuation.

3.2%

Top Quartile

18.1%

2.7%

Over age 55

Age 46-55

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4.3%

Age 36-45

Average

13.2%

Up to age 35

3.0%

Comparison Group Average

Book of Business per Producer (commissions and fees)

Book of Business by Age

Notes & Definitions

• Weighted average producer age (WAPA) is 46. •

Effective NUPP, which is the product of an agency’s investment in unvalidated producers (NUPP) and success rate in hiring producers (Producer Success Rate), is expressed as a percentage of net revenue. It is the best overall measure of an agency’s effectiveness in recruiting and developing sales talent. The BPS agencies in this revenue category achieved a Sales Velocity of only 13.2%, lowest of all the revenue categories. However, these firms are getting the highest percentage of total Sales Velocity from producers in the two youngest age groups. These agencies achieved the second highest Producer Success Rate (62.4%), but their relatively low NUPP (1.3%) resulted in an Effective NUPP of only 0.8%.

Up to age 35 15.4%

New Business

Average Book

Over age 55 36.3%

Commercial P&C

$74,013

$573,503

Personal P&C

$42,664

$288,624

Age 36- 45 26.4%

Life/Health/ Financial

$89,649

$655,032

Multi- Line

$68,302

$589,520

Age 46- 55 22.0%

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Effective NUPP

Group Average:

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 42