imgbd Think BIG: Advisor Insights

2 crore SIP book in a town of only 70,000 people


Pratik Patel, Akshar Investments, Borsad (Gujarat)

Thinking BIG is the first step to achieving BIG. 34 year old Pratik Patel is thinking real BIG - in a small town with a population of only 70,000 people, he is convinced that he is firmly on track to create an SIP book of Rs. 2 crores per month from 5000 clients. He's begun well - with 850 SIPs and a 26 lakh SIP book - and has a simple and clear plan on how he is going to make it BIG, even in his small town. Tremendous confidence in himself, high conviction in his product and an amazingly positive attitude - that's what is going to help this young man make the impossible, possible.

My partner Manish Patel and I have an accounting business and a share market business, which is reasonably successful. We started our mutual fund business 3 years ago, after I understood fully the concept of SIPs and the power of wealth creation this simple investment vehicle possesses.

No market is too small

My town Borsad is in Anand district in Gujarat, with a population of around 70,000 people. Some might say it is a very small market to have big ambitions, but I think differently. If you have a good product, which you are convinced is beneficial for investors, no market is too small for you.

Explaining SIPs

I am a firm believer that over a 10 year period, equity SIPs have the potential to deliver 12% returns to investors. If you are patient, you are bound to create wealth. There is no doubt in my mind about this. When we meet clients, we ask them to show us their insurance policies. Almost everyone has an insurance policy. In most cases, when insurance policies were taken around 5 years ago, their current valuation is only around the cost - no appreciation, and in some cases, it is below cost. This comes as a shock to most investors.

There are two things we explain to investors:

  1. There is risk everywhere. Some risk is very visible, some less visible. But if you want to create wealth, you cannot run away from risk.

  2. Mutual funds also have market risk - but they are transparent, there are no hidden charges, there is no asterix with a "conditions apply", they are well regulated. What you see is what you get.

1 week reflection period

Once we explain the power of equity SIPs to create long term wealth, and after we demonstrate how they can help meet financial obligations like retirement and children's marriage and education, we tell them to think about our discussion and consult family and friends for a week. We promise to contact them only after this 1 week thinking time, to discuss their decision and take next steps. This gives them time to reflect, consult and gain comfort and confidence. One week later, we touch base again, and most often, we find clients willing to go ahead. It is important that they develop confidence without any push from our side.

Laminate the first Statement of Account

Once an SIP is commenced, we laminate the first Statement of Account, and write down on that laminated sheet the period for which we have started this SIP and the purpose. We ask clients to keep this laminate safely for 10 years, 15 years - whatever is the period agreed. In small towns like ours, an FD receipt is kept safely for years, an LIC policy is kept safely for years - we want investors to get that long term feel with mutual funds too - hence we laminate the SoA and inscribe period and purpose. This gets them in the right frame of mind on how to look at this investment plan that they have started.

Rs.26 lakh SIP book today. Target: Rs. 2 crores

In mutual funds, I have 800 clients, of which over 500 have started SIPs with us. Total SIPs today are 850, with monthly contributions of Rs. 26 lakhs. In my firm, my partner, I and one of our staff members - 3 of us are focused on mutual funds. We have set ourselves a target of acquiring 5000 SIP clients with a SIP book of Rs. 2 crore per month. I have a small temple in our office, and I have written this down in the temple: 5000 SIP clients, 2 crore SIP book. It will happen. We have a simple daily task - meet 10 new prospects - through referrals or other interactions. If we achieve this, we will achieve our goal. We have to approach our goal one day at a time.

Recently, when we conducted an investor awareness program in Borsad, we were fortunate to get Brijesh Dalmia as the speaker. We had 700 investors participating in the program, and many of them recorded his entire presentation - it was so simple yet impactful. These kinds of programs help us in achieving our client acquisition targets.

Market is large enough, if product is good and selling is right

Some people think our ambitions are too high for a small town like Borsad. I think differently. I need 5000 clients. Borsad has 70,000 people. The market is big enough. Small town people save more than city people. We don't have families caught in EMI traps from property purchases. We don't spend a lot. We therefore accumulate healthy savings. What we need to do is invest these savings intelligently. That's where I come in.

My partner read about the story of i-phones. I-phones sell well the world over because they are essentially good products with little competition. I believe mutual fund SIPs are also great products - we just need to take them to investors and sell them correctly.

I believe we will hit our target of 5000 clients with a 2 crore SIP book in 3 years. But, we don't put pressure of numbers and a date. Numbers and dates create wrong types of pressures. We don't want even one SIP to be mis-sold. I have seen a lot of insurance and mutual funds being mis-sold in Borsad. It destroys trust, and does nobody any good. SIPs may take time for us to earn substantial amounts of commission, but I know we will earn well over time, just as our clients will earn well over time. I am not fussed about when we will hit our target - I know we will hit it surely - if we stay focused on meeting 10 new prospects every day.



Content is created by Wealth Forum and must not be construed as an opinion by Reliance Mutual Fund.



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