Edward Jones has been rapidly training new advisors in an attempt to reach 20,000 with $1 trillion in assets by 2020. Jim Weddle, head of Edward Jones, anticipates the latter objective will be reached soon. But in an interview with On Wall Street, he says the firm has not found as many quality recruits as it would like.
YOUR FIRM HAS A GOAL OF REACHING 20,000 ADVISORS BY 2020. ARE YOU STILL ON TRACK TO MEET THAT OBJECTIVE?
We are refreshing our five-year plan and will be redefining our plan. We are well on our way to hitting all of [our goals], but we will not hit all of them by 2020.
WHICH ONES WON'T YOU HIT?
Last year, we grew by 842 advisors. This year, we're obviously not done, but looking at the pipeline, attrition is very low. We will grow by 600 advisors. We've raised the quality of the individual we're offering our opportunity to. We're finding some great people out there, but not as many as we [would] like.
We're ahead of pace on assets under care. We're on track in terms of deeply served households. And when we say that, it means finding and serving our clients on multiple needs.
20,000 [advisors] – I don't know if we will hit that by 2020, but we will hit it shortly after that.
WHY ARE YOU NOT FINDING AS MANY NEW RECRUITS AS YOU WOULD LIKE?
It's difficult to find the right people who are both excited to be in the business and [have] the willingness to work. We can teach the skills and knowledge, but the willingness has to come from them.
Just looking at the last few weeks as the market has gotten volatile … people are saying, "I don't know if I want to make a career change." I understand that, but we will still have some success finding and hiring the right people. We're looking in the same places, but we just have to work a little harder to do the work and find the people who will fit the business model for the firm.
For us, it is still a much more attractive way to grow than acquisition, because we are protective of our culture and values. Those things can get damaged if you grow through acquisition.
EDWARD JONES HAS LONG ESCHEWED THE RECRUITING GAME THAT OTHER FIRMS PARTICIPATE IN. WILL YOU AMP UP RECRUITING ADVISORS FROM OTHER FIRMS TO MEET YOUR GROWTH OBJECTIVES?
That's a zero-sum game. That's why the industry dropped by 2.5% advisors last year. Some retired, some passed away. But if you are just recruiting from your competitor across the street, you're not adding anything.
Look, we've got an unprecedented generational wealth transfer [coming]. The industry is shrinking, and it makes no sense. We are going to grow organically. Yes, we will bring in some people from other firms, but we're focused on organic growth. I wish some of our peers would be more focused on bringing in new people into the industry.
But training is expensive, and it takes resources and patience. A lot of firms don't have that. But we're a partnership and can make those kind of longer-term decisions. We are responsible to our clients, but we are accountable to ourselves. I'm not building shareholder wealth here. We're building wealth for our clients. So if we do that, everything else will take care of itself.
As a partnership, we don't have to cater to quarterly earnings.