Till sometime back the housing industry was all about unaffordable housing. Less people could afford and therefore margins were high and builders made a killing. Then came demonetization among other things like shrinking demand that put the brakes on this industry. People predicted the industry would experience a severe slow down. But the government had other plans. Low cost housing is emerging as a huge opportunity for constructors. Low cost housing is being given status of “infrastructure” which means buyers will get access to low cost loans. Clearly a move from “high margin high cost” homes to “low margin low cost homes”. The margin shrink will be more than compensated by volumes.
If one looks at the phenomena of Amazon, Uber, Oyo rooms, etc, one discovers the same “high volume low margin” strategy in vogue.
Remember because India is a developing and young economy this model is playing out successfully and will sustain itself over the next decade or two. No wonder international brands are lining up to do business with India.
An IFA, will need to consider these developments. Technology, both transactional platforms like BSE Star as well as operational platforms like Red Vision etc coupled with the government’s move to digitise the economy will make it possible for the IFA to source customers from any part of India.
It is just a matter of time to bid goodbye to wet signature procedures. The day is not far when one will be able to do KYCs remotely. This essentially means you can obtain customers from any geography within India and that your market size will expand. It also means your customer could get serviced by a remote IFA. Competition and opportunities will emerge together. Geography is all set to become history.
Clearly adopting technology and adapting to it is a non negotiable need of the times. Moreover, building your personal brand has become a hygiene requirement and one can no longer hide behind curtains.
IFAs who adapt to changing environment will stand to gain immensely in the future and those who ignore these trends may stand to lose their clients to smarter advisors.
Let’s gear up for interesting times. Let’s make a choice. Let’s become students for life.