UK financial planners face two huge pressures on their businesses as the British recession continues to bite and investment market volatility continues to repel investors.

The underlining two-pronged threat to UK advice businesses is a combination of weaker client demand and the limited ability of firms to lower costs in this new constricted environment.

A third of British financial planners cite tough market conditions as the biggest challenge facing advisers generally, while more than half reveal a need for more efficient systems within their individual businesses.

The situation could turn bleaker for UK advisers as planners believe regulatory change endangering IFAs as a distribution channel is the second biggest challenge faced by all advisers.

In fact the biggest challenges segment as follows:

• One third (34.2%) of advisers believe difficult market conditions are the greatest challenge.
• One quarter (23.8%) believe it is the shifting regulatory environment that is threatening the whole notion of intermediaries as distributors.
• One in five (19.9%) feel it is a lack of consumer trust in the financial services industry as a whole that is most pressing.

At a more micro level the following charts provides some insight as to the mindset of IFAs in relation to their own businesses.

It’s about increasing operational efficiency and undertaking more effective marketing campaigns against the background of negative sentiment caused by the broader macro environment.

The data in this article is derived from an annual CoreData study into the business operations of UK Financial Advisers.

The findings are interim in nature as the study is live and presently has 340 participants.