October 22, 2019  
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How to Start an Annuities Business

Opening an annuities business is a rewarding experience if you have the creativity and tenacity necessary to be a successful entrepreneur. This article contains a few secrets to improve your startup process.

Here are a number of valuable bits of advice on how to open an annuities business.

Starting an Annuities Business

Annuities are financial products that provide investors and consumers with future distributions on their investments. In some cases, distribution terms are tied to the life of the investor (i.e. life annuities), but in today's financial market these types of annuities are rare compared to those that are indexed to investment amounts.

In many ways, annuities entrepreneurs are very similar to insurance entrepreneurs. By selling annuities to individuals, the entrepreneur earns a commission and can conceivably branch out into agency ownership.

Although the startup costs associated with an annuities business are less than the costs for other types of businesses (e.g. manufacturing operations), emerging annuities entrepreneurs should not ignore capitalization requirements. Often, normal operating costs, licensing fees and other expenses overwhelm undercapitalized entrepreneurs, jeopardizing the long-term sustainability of their operations.

Tips for Annuities Business Startups

Like any other business startups, success is not automatic for new annuities companies. In fact, to achieve success you will need to be at the top of your game and implement sound business strategies in several key areas.

  • Carrier Relationships. Annuity sellers represent major carriers, large companies that specialize in the creation and delivery of financial products to investors. In essence, carriers act as suppliers of the annuity products your company will sell to investors. Participation in trade organizations like the National Association for Fixed Annuities (NAFA) is a great way to interact with industry veterans who can direct you toward potential carriers.
  • Marketing Strategy. Marketing is a major hurdle for many annuities entrepreneurs. Although you may see yourself primarily as a financial professional, a good share of annuities business ownership boils down to creating and executing effective marketing strategies. If you aren't prepared to develop a marketing strategy from scratch, consider hiring a professional marketing firm for assistance.
  • Selling Skills. You know your annuities products inside and out, and your marketing strategy is driving scores of prospects to your front door. But you're still not in the money -- at least not until start sealing deals. The best annuities entrepreneurs are skilled salespeople who understand the mechanics of personal selling and are capable of closing a high percentage of sales.

How to Write a Simple Annuities Company Business Plan

Haven't created a business plan for your annuities business yet? You could be in big trouble.

At Gaebler, we advise new business owners to keep your business plan simple. Length and polish aren't as important as consistency, accuracy and thoroughness.

Instead of investing countless hours in a lengthy business plan, put pen to paper now and document the essentials with the understanding that your plan will be revised as you move forward.

Assess the Competition

Prior to opening an annuities business in your town, it's essential to see how you will fit in the competitive landscape. We've provided the link below to help you generate a list of competitors in your city. Simply enter your city, state and zip code to get a list of annuities businesses in your town.

Gain a knowledge of how existing firms have positioned themselves in the marketplace, and then design your business in a way that sets you apart from the others.

Getting Advice from Experienced Entrepreneurs

If you are interested in starting an annuities business, it's essential that you have a conversation with someone who is in the business. If you think owners of nearby annuities businesses will give you advice, think again. It'd be crazy for them to teach you the business.

On the other hand, an individual who has an annuities business in another town may be willing to share their entrepreneurial wisdom with you, after they realize you reside far away from them and won't be stealing their local customers. Many business owners are happy to give advice to new entrepreneurs It can take a while to find an entrepreneur who is willing to talk, but it's well worth the effort.

Where do you find an annuities business manager that lives outside of your area?

Easy. Find them using our link below and start calling until you are successful.

Advantages of Buying an Established Annuities Business

It's no secret that entrepreneurs have a strong impulse to build companies from the ground up.

Yet a healthier and safer strategy may be to purchase an existing annuities business.

Existing annuities businesses are proven operations with dependable revenue streams. When you buy, you also gain the ability to sidestep all of the trial-and-error that comes standard with any annuities business startup.

Explore Franchising Options

The odds of avoiding failure in business go up significantly when you franchise and leverage their successful brand and track record.

If your goal is to start an annuities business, you should check out whether franchising might be worth investigating.

The link below gives you access to our franchise directory so you can see if there's a franchise opportunity for you. You might even find something that points you in a completely different direction.

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