Long Beach CA, – Registered Investment Advisors (RIAs) stand to increase their profits 40 to 55 percent by investing in electronic document management technology, according to a study conducted for Laserfiche®, an electronic document management solutions (edms) firm.

By increasing back-office efficiencies, streamlining regulatory compliance tasks and by reducing rent costs, RIA firms can also increase their business valuations, from $200,000 for an emerging firm to upwards of $3.4 million for enterprise sized firms, the study concluded.

“As many leading RIA firms are looking to enhance the value of their businesses, they are finding that increased profitability and an efficient infrastructure are directly correlated to business valuation drivers,” said Timothy Welsh CFP, president and founder of Nexus Strategy, a financial industry consulting and research firm that conducted the study for Laserfiche. “Through a focused effort in leveraging electronic document management technology, the next generation of RIAs are realizing increased business valuations from the inherent operational benefits of these innovative solutions.”

The following table summarizes the return on investment (ROI) potential of a typical document management technology program based on three sizes of firms:

Firm Size:

Emerging ($500K)

Established ($1,000K)

Enterprise ($4,000K)

Technology Investment:

1.4% of revenues $7k

2% of revenues $20k

1% of revenues $40k

Staff Savings:

1000 hours
(0.4 of a person)

1500 hours
(0.6 of a person)

6000 hours
(2.4 people)

Overhead Savings:

8.6% of revenues
or $43K

8.9% of revenues
or $89K

8.6% of revenues
or $342K

Profit Increase:




Business Value Increase:




The study pointed to three principal areas of cost savings and efficiencies:

  1. Space efficiencies – “Upon fully implementing a document management system, RIAs no longer need filing cabinets on premises.” As rent consumes an average 6 percent of revenues for small and medium sized firms (5 percent for larger firms), “analysis has shown that the space reduction for filing cabinets is equal to 25 percent of total rent costs in emerging firms, 30 percent in established firms and 35 percent in enterprise firms,” resulting in savings of $8,000 to $27,000.
  2. Back office efficiencies — “Based on hundreds of installations and experiences with investment advisors, the savings from back office efficiencies is conservatively estimated to equate to a 20 percent savings in back office staff time” resulting in savings from $24,000 to $284,000.
  3. Compliance efficiencies – The highly efficient search and retrieval capabilities of a document management system, according to the new study by Nexus Strategy, equates to a 3.7 percent reduction in compliance costs as a percentage of revenues, or savings of $19,000 to $158,000.

“For obvious reasons, a business that is systematized, has infrastructure, and is efficient will be more highly valued, due to its lower risk, both operationally and as an investment in ownership, as well as its higher profitability,” the study concluded. “If we apply these concepts to the return on investment for a technology implementation, such as digital document management, we can see the dramatic impact on business value.”

“Through hundreds of implementations of Laserfiche technology solutions in independent financial advisory firms over the past decade, our clients have reported very compelling cost savings,” said Chris Wacker, Senior VP of Business Development for Laserfiche. “This is the first time that we have documented those savings in terms of real dollar savings, impact on profitability and business value, and the results truly speak for themselves.”

According to J.C. Abusaid, Chief Operating Officer for Halbert Hargrove Investment Counsel, “While we haven’t put an actual dollar figure on the value of this system and what it does for us, we do know that in terms of scaling upon existing infrastructure, back office efficiencies and the lack of filing storage—it has to be in the range of tens of thousands of dollars per month.”

For more case studies on document management and the RIA industry, as well as information on Laserfiche’s complete product suite of document management solutions, please visit www.laserfiche.com.

About Laserfiche
A resource for over 25,000 organizations since 1987, Laserfiche creates simple and elegant document management solutions that help organizations run smarter. Dedication to customer driven innovation has built a suite of products and services that address organization-wide business problems from executive, records management, information technology and end-user perspectives. Laserfiche manages mission-critical information in local, state and federal agencies; financial services firms; healthcare organizations; educational institutions; and other public and private sector organizations around the world.

Media contacts:

Intermarket Communications:
Andrew Yemma – 212-754-5450 andy@intermarket.com
Anne Bodnar – 212-754-5437 anne@intermarket.com

Laserfiche Media contact:
Francine Marlenée – 562-988-1688 ext. 211, fmarlenee@laserfiche.com

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