DCIO Market at Risk of Losing Ground

While DCIO (Defined Contribution Investment-Only) assets continue to grow at a healthy pace, the industry is entering the early stages of maturity, according to a recently released study from Chatham Partners.

Accordingly, Chatham said, future winners will have to increase platform distribution efficiencies, improve ROI measurement metrics, elevate brand positioning, and demonstrate product innovation in order ensure ongoing profitability – all discussed in the report, “Strategic Growth Opportunities in a Competitive Marketplace: Effectively Running a DCIO Business.”     

“Our research found that despite healthy asset growth over the past two years, these increases have been largely attributable to market returns – not to net cash flow,” said Luis Fleites, Vice President and study director.  “Upon deeper analysis of the results, we discovered that several operational areas will require greater management scrutiny in future years as the DCIO market begins to mature.  Unless managers develop metrics to closely examine their ROI in areas such as marketing, sales, and compensation, profitability is likely to begin to decline.”  

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Chatham Partners’ research revealed that DCIO managers face challenges in differentiating themselves in the marketplace. Oftentimes, marketing efforts are leveraged through broader organizational resources and the messaging fails to create a unified firm-wide retirement message.  “The problem,” says Fleites, “is that the marketing strategies and approaches being utilized by these firms are not always aligned with this goal.”  

The study surveyed 19 asset managers ranging from $1 billion to over $50 billion in DCIO assets under management, along with several leading DCIO executive recruiters.  The study was designed to provide market and competitive insights and operational and profitability benchmarking into key dynamics of the DCIO market, including:  organizational structure, product, marketing, distribution, and business economics.   

For additional information about this study contact Luis Fleites at (781) 314-0607 or lfleites@chathampartners.net or visit the Chatham Partners Web site at http://www.chathampartners.com.

CBIZ to Acquire Multiple Benefit Services

CBIZ, Inc. has signed an agreement to acquire Multiple Benefit Services, Inc. (MBS).

MBS provides employee benefit consulting, support, and services to 80 national and international clients, ranging in size from Fortune 500 companies to those with less than 100 employees. The Atlanta-based firm, founded in 1992, recorded approximately $3.5 million in revenue during the past year.

CBIZ offers financial services, such as accounting and tax, internal audit, merger and acquisition advisory and valuation services, to help clients better manage their finances and employees. Employee services include group benefits, property and casualty insurance, retirement plan consulting, payroll, HR consulting, and wealth management, as well as outsourced technology staffing and support services, healthcare consulting, and medical practice management.

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“We believe that CBIZ’s full suite of insurance and financial services positions MBS to offer significantly expanded resources to our existing client base,” said Marion B. Schremp, MBS CEO. “This merger also allows us to move forward with and accelerate our own growth plans.”

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