SOLIDGROUND

Reagan Consulting, in the “2022 Best Practices Highlights Webinar" held after the study's release.

Key findings from the 2022 Best Practices update include:

1) Organic growth surges. At 9.2%, organic growth was 2.5 times last year's results of 3.7%. Organic growth increased in all six revenue groups in this year's study.

2) Profitability remained at all-time highs. At 26.2%, Best Practices agency profitability went up slightly from 26.0% last year.

3) The Rule of 20 achieved a record high. The Rule of 20, calculated by adding 50% of profitability to organic growth, reached a record high of 24.0 in this study versus 18.0 in the previous study. The Rule of 20 is the best metric to gauge overall agency health, according to Reagan.

4) Mergers & acquisitions bolstered growth. In the 2022 study results, 22.3% of Best Practices agencies acquired a business, up from 16.4% in the previous study.

5) Producer recruitment and development proves challenging. Net unvalidated producer payroll (NUPP), a measure of producer recruitment and development, remained at 1.1% of net revenues compared to 1.2% in the previous study. A healthy NUPP investment would be 1.5%-2.0%, according to Reagan, which is an indication that agencies should consider redirecting a portion of today's record profits toward investing in new producers.

6) Shareholder and producer ages hold steady. The weighted average shareholder age (WASA) was 53.2 years, and the weighted average producer age (WAPA) was 48.6. Agencies should manage these two metrics carefully as lower WASA and WAPA are critical to long-term agency perpetuation.

Continued from page 18

As the independent agency channel heads into an uncertain 2023, Doran encourages agencies to focus on the metrics in the Best Practices Study. “We encourage our industry to continue getting younger," he says. “One of the dynamics that we've struggled with for the last three decades of this study is that we've struggled to track and develop enough young talent in the industry."

“Profitability is super important, but growth is really the most important driver of our economic viability, and so we want to continue to focus on new business activity," he adds.

Guidelines

Trusted Choice will reimburse a portion of expenses incurred in 2023 by Big “I” members for co-branding advertising and marketing materials or making certain digital improvements for your agency.

Reimbursement Allotment

All agencies are eligible for up to a $1000 reimbursement for co-branded marketing and certain digital improvements. This is a 50% match base on one allotment per member agency (limited to one location.)

2 3 T R U S T E D C H O I C E M A R K E T I N G R E I M B U R S E M E N T

2 0

Ways to Qualify

P R O G R A M ( M R P )

Co-branding: Use of the Trusted Choice logo on consumer facing advertising. For access to pre-produced advertising materials visit our Marketing Campaigns that can be customized for your agency free of charge by Trusted Choice staff. There are print, digital, video and radio ads available.

Digital Co-branding: Use of any of the Trusted Choice customizable marketing materials or brand creative that includes the Trusted Choice logo. This includes video production and advertising costs (display ads, social media ads, YouTube etc.)