Crossing the Border with Asset Management

Although the firms surveyed in the study list their quality staff and performance results as strengths, they also listed quite a few concerns, according to a press release.   The lack of adequate distribution channels was the number one concern for US money managers, chosen by 37% of firms surveyed for the study. It ranked third for European money mangers, garnering 25% of their votes.   The difficulties in penetrating foreign markets due to overcrowding (43%) and strength of competition (32%) were the top challenges for asset management firms in Europe, according to the release.

The number one step money managers in both Europe (57%) and the US (41%) plan to take to remedy the challenges of cross-border marketing is to improve their contact with consultants and other gatekeepers and intermediaries.   In addition, 43% of European firms responding to the study and 26% of US firms said they plan to create a joint-venture or strategic alliance with a local distribution entity.   The plan to hire more experienced staff in foreign outposts was also chosen as a remedy by 41% of money managers in Europe and 22% of those in the US.   No money managers said the remedy was to abandon foreign markets altogether.

In listing their current distribution strategies for foreign markets, 73% of all firms surveyed said they cooperate with other consultants.   Fifty-seven percent of firms said they manage their foreign distribution from the home office, while 53% open marketing offices local to their foreign market.   Working with financial intermediaries was a strategy listed by 48% of money managers, and having a strategic alliance with local firms that have distribution but no products was listed by 36% of those surveyed.

Close to 70 European and US-based asset managers responded to the survey used for the study.   Telos and its sister company RCP are rating agencies specializing in qualitative ratings for asset managers, mutual funds, and other asset management products and services.   FS Associates is an international financial consulting firm with a practice that focuses specifically on cross-border strategic alliances.   Its Web site is www.fsassociates.com .