Fire 43 Clients, Write Just 1: The Math That Doubles Your Book

Every producer hits the same wall: more accounts, more work, same ceiling. Randy Schwantz pulls the numbers from a survey of 168 producers and $92 million in commission and finds the fix hiding in plain sight: your top 20% of accounts average $17,774 each, your bottom 40% average $518, and one top account is worth 34 of the small ones. 

Randy lays out the exact system, over-serve your best clients, earn the right to introductions into who they know, and wedge out the incumbent, that took a $546,000 book to $1 million with fewer accounts, not more. Stop writing anything that breathes. Press play and find out how many accounts you actually need to fire to double your paycheck. 

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[00:00:00] Hey, if you could double your personal income, do it in about three or four years, and do it with half as many accounts, would you want to? 'Cause when you think about it, if you double your personal income, that means you're making twice as [00:00:10] much money, and that gives you a lot of financial freedom. We're gonna get into what that would mean to you here in just a moment.

Welcome to the Agency Growth Machine podcast, where it's all about [00:00:20] transforming potential into profit. And now your host, Randy Schwantz.

 there's a lot of people that somehow get to a ceiling and start [00:00:30] bumping up against it and get stuck, and I'm gonna show you how to blow through that ceiling using this formula right here. So here it is. Double your book of business, do it in about three years, and do it with half as many accounts rather than [00:00:40] twice as many accounts.

Why? Because twice as many accounts means even more work, and most of you are already... Like, I was talking to a guy the other day, had a million dollar book of business. He's making great [00:00:50] money. He's got the capability of going to $2 million 'cause he's got the talent. I mean, a brilliant kid, but he's stuck.

He's stuck 'cause he's got 240 accounts he's trying to manage, some personal lines, some [00:01:00] small business. He's in a town with, you know, 200,000 people, so he knows everybody, and it becomes this crap magnet. So this is for people like him. Maybe it's for people like you [00:01:10] who are bumping up against the ceiling, but you feel like you've got so much more capability if only you could just make up the capacity to go do it.

So let's get in on this deal. So how do you double your book of [00:01:20] business in three years with half as many accounts? Well, number one, position your book of business for both profitability and growth by really taking the top 20% of your [00:01:30] accounts, that in most cases make about 80% of your money, and over-serve them.

In fact, we've got it right there. Over-serve the top 20% of your accounts. Once you've over-served them [00:01:40] by putting them on a service timeline and doing the appropriate thing, then you've earned the right to go leverage those relationships for introductions into who they know. Well, what we [00:01:50] know, and what you probably know too, is that if we just started right there and we put your name, there's you, and we just draw out a drawing out all the people Your top 20 accounts, [00:02:00] and then start writing out who do they know that you want to meet, and you build out that map, you could probably map out a book of perfect targeted prospects that would [00:02:10] equal your book of business today.

And chances are you could do it in about three or four hours, and it would create this amazing liberation. So you start off by over-serving your top [00:02:20] accounts, then that earns the right to go leverage them for introductions into who they know. And then you go grow by wedging out the incumbent, taking the money, and then you just start to [00:02:30] keep track of the scoreboard.

'Cause you want your closing ratio to go up. You want your average size account to go up. You want your growth year over year to go up. And that's [00:02:40] really what we call the two and three over two or the million-dollar producer concept. Now, why do most people struggle with that? Well, let's pull this dude up.

Oh, I got to find it. Here [00:02:50] we go. So why do so many people struggle with this? Well, this is a survey I did with, as you can see right here, just gonna try to point it out as I go through it. I did it with [00:03:00] 168 producers that had $92 million of revenue. It averaged... Or it was a total of 17,000 commercial accounts.

So it was a large [00:03:10] agency with a number of different offices, and we had them all together when we went through this. Now I'm not gonna take you through all that. I'm just gonna try to get you right down here to the summary of it because it's important for you to know, or hopefully it's important you know.

[00:03:20] I did a analysis of the top 20% and analysis of the bottom 40%, and here's my summary right here. And hopefully you'll find this very meaningful to you. [00:03:30] So the average book of business amongst all 168 producers, the average book of business was $546,000. Had 106 accounts [00:03:40] on average. The average account size was $5,159.

Well, when you take the value of the top 20% of their accounts, well, 20% of [00:03:50] 106 is 22 accounts, you can see right there. Brings in just under 400,000, 399,000. Average account size, [00:04:00] $17,774. All right. So that's pretty interesting news. If you come down here and you look at the bottom 40% of their accounts, that's [00:04:10] 43.

So 40% of 106 is 43. brings in $22,000 in total. And the average account size, which you have a hard [00:04:20] time seeing right there in red, is $518. Now, what's interesting, if we go on with our analysis, it says right here a producer could write [00:04:30] 1.25% of their top 20. In other words, if they just wrote one more 17, one and a quarter $17,000 accounts, they could eliminate the whole bottom 40%, say [00:04:40] goodbye to 43 accounts.

I write 1.25 accounts, and I say goodbye to 43 accounts. Now, the question is, if you did that, what would that do to free up time and free up [00:04:50] capacity? And that's what we're talking about. So many people are bumping up against the, the glass ceiling. I just can't go do any more, right? Now, look at this. On the flip side, a producer would have to write [00:05:00] 34 of the bottom, 34 of the $518 accounts to equal just one of the top 20.

So you get to pick how you're gonna, like, go do your life. Now, [00:05:10] as we get into this and go a little bit deeper, to take this $546,000 book of business and double it to go to one million. In other words, that's a two multiplier, two [00:05:20] X, doubled it. If you take the 399,000 from that, you gotta make up 694. That's the, that's the balance, and you get rid of all the small stuff, even the middle [00:05:30] stuff.

At an average account size of 17,000, you'd have to write 39 new accounts. You add that to the 22 you got, you'd have a total of 61. So we just went from 106 accounts down [00:05:40] to 61, and we made two times as much money. That's what's out there for you with a little bit of strategy and a little bit of figuring out how to go make that [00:05:50] thing happen.

But then you gotta back up and go, "Well, why would I want to?" And that's what I wanna get into right now. So here I am getting into Bignition. Click. [00:06:00] I'm gonna go over to My Goals, My Account, My Goals And we're gonna take a look at this producer who in most situations would be considered a stud [00:06:10] producer.

Why? Because this dude has... Let's get it over here. This example producer already has a million-dollar book, a million one eighty-three. And so [00:06:20] I wanna come back, and I want you to start thinking about this thing we call fun life. So the question I'm posing to you, why would you wanna double your personal income?

Well, my personal story is very simple. [00:06:30] I'm the father of four daughters. A number of years ago when they were six, four, two, and newborn, I came to the realization I did not have a plan for how much money I needed to make or save and [00:06:40] for what long period of time to be able to fund four cars, four universities, four weddings, and retirement for Lori and I.

So I sat down with [00:06:50] a financial advisor, and with that financial advisor, you know, we put down, you know, here they were at that point, six, four, two, and newborn. So that ten years from now I need to buy a car. Twelve years from now I need to buy a [00:07:00] car. Fourteen years from now I gotta buy a car. Sixteen years from now we gotta buy a car.

At ten years old, when they turn eighteen, I gotta pay for college, right? So eight years, ten years, twelve years, [00:07:10] fourteen years out, and then wedding, wedding, wedding, and then retirement, add it all up. And what, what he told me at that point is that I needed to save sixty-five [00:07:20] thousand dollars a year to be able to fund all that stuff, and I'm talking about every year for twenty years.

And at that point, all I could save was somewhere in the range of [00:07:30] seventy-five hundred dollars a year. So I was underfunding my future some crazy number in the range of fifty-seven thousand five hundred bucks. [00:07:40] That's how much I was under-earning or under-saving. And so I've worked with a lot of producers, asked a lot of producers the same question.

You know, what's your new business commission goal? How'd you [00:07:50] come up with it? Why that? Bum, bum, bum. You know, did the agency owner assign it to you? Did you come up with it yourself? And it's just, it just became very [00:08:00] clear to me a lot of producers, not all, but a lot of producers they just haven't put that much thought into it And I don't know if you're like me, but, you know, growing up, I mean, we were [00:08:10] lower middle class, and my dad always said to me, "Hey, son, you know, don't, don't be intimidated by those rich guys.

You put your pants on one leg at a time just like they do." And I got a feeling that the [00:08:20] rich guys' dads were telling their kids, "Hey, look, man, whatever you do, don't talk about money, uh, because, you know, uh, we don't want you to seem arrogant, overconfident, any of that sort of stuff. And [00:08:30] by the way, if everybody knew how much money we had, everybody'd wanna steal it."

My dad said, "Don't talk about money. Don't be intimidated." Their dad said, "Don't talk about money because they're gonna wanna steal it," so nobody talks about money. Well, [00:08:40] I asked, I presented all this to, to one of my clients, an agency owner. Like, "Let's go do this with your, with your producers. Let's get them really clear on this stuff."

And he goes, "Well, [00:08:50] look, it's, it's personal, and I don't get personal with my producers. Focus on agency goals. Let the producers take care of themselves." I said, "Yes, of course it's personal. Root word of [00:09:00] personal is person. All you, all these producers you got f- working for you are people. They're persons.

Like, what would happen if we got them massively clear on this stuff?" And when you [00:09:10] think about it, this thing up here, this brain, is just like a computer. A computer runs on software. Your brain works on plans. The better the plan, the better the goal [00:09:20] setting, the more clarity, the better it's gonna do, just like a computer.

If your software is buggy, you're gonna get buggy results there. If your brain, if you don't have clear goals, then you're gonna [00:09:30] get bra- you know, buggy results with your brain. So with all that said is why I created this for producers, is you can come in and put in your family members. You come in and put in the major life [00:09:40] events, car, college, car, college, car, wedding, college, retirement, car If you get nothing out of this, just know that for your retirement, you need [00:09:50] about 22 times whatever you expect to retire on.

So if you expect to retire on, I'm gonna say $200,000 a year, then you're gonna need $4.4 [00:10:00] million. And you're saying, "Well, why would anybody need $200,000 to retire on?" You know what I mean? 'Cause kids gone, all that sort of stuff. Well, when you put inflation, put everything else to it, the chances are that's not [00:10:10] gonna be an absurd amount of money.

But you get to pick. It's your choice, not mine. So what happens here is that when, when producers put in, "There's my car, there's the college, car, college, car, [00:10:20] college, car, college. Date, date, date, date, date. Money, money, money, money, money, money. Here's how much you have in the bank. If you're contributing to it, here's what you think you'll return in the stock market."

It [00:10:30] will tell you the future value of it, it'll tell you the balance needed, and then it'll break that down into a monthly contribution. That monthly contribution comes all the way down here about what you need to save on an [00:10:40] annual basis, and then it subtracts what you're already saving and tells you what the bogey is.

This person right here is doing really well, good. This person's already saving $76,000 a year. But I've [00:10:50] talked to thousands of producers, and I would say that 95% of them are saving way less than even 30 grand a year. Many of them are grossly [00:11:00] underfunding the future by as much as 30, 35, 40, 45, 50 grand. And, you know, it becomes even more apparent.

So why, why do I bring this up? Not to make you feel good or bad, either one, but [00:11:10] to, to both encourage you and your sales leader to get together, because my belief is this, and I've seen it in action on numerous occasions. [00:11:20] Even with young producers, and I'm talking about 24-year-old kids, young men in this context.

They don't have a girlfriend, not married, no kids. But a lot of [00:11:30] times I ask them, "Well, do you think someday you'll get married?" "Well, yeah, probably so." "Well, do you think you'll have kids when you get married?" "Yeah, of course." "Well, would you be more attractive to a future spouse if you had this [00:11:40] all mapped out than if you don't?"

"Yeah." "And also, knowing if that's the case, why wouldn't you start planning for it now?" "Oh, righty, that makes a lot of sense." So I got people putting in that they're [00:11:50] gonna have-- they're not gonna start having kids for maybe another seven, eight, nine, ten years. They're already funding for it, thinking out loud in front of people, owning the, what it's gonna be [00:12:00] like.

And I promise you, every one of those guys, they're gonna retire multimillionaires because they're thinking this way. But there's a lot of people that nobody challenges them, and [00:12:10] so they're stuck over here writing any account that will breathe. They're writing, you know, little accounts like you see here, the, [00:12:20] the average of, of $518,000, you know, average of $3,000, when they've got the capability of doing this.

And so to me, a great [00:12:30] sales leader would sit down with a producer on a periodic basis, really getting them think about long term. Stephen [00:12:40] Covey, the great Stephen Covey, from Seven Habits of Highly Effective People, habit number two was keep the end in mind. Well, the end for all of us, someday this career is going [00:12:50] to end, and when it does, you want more than likely financial freedom.

If you sit there and go, even if that's 10 years or 20 years or [00:13:00] 30 years or even long farther out into the future, define what that is and reverse engineer it all the way back to now and start building that so now you're working on purpose to [00:13:10] support your goal, your vision, as well as your family getting ahead of the curve rather than being behind the financial curve.

So many owners think they should assign [00:13:20] a producer a goal like 75 or $100,000 or $125,000 because that's how the agency leader can continue to ensure [00:13:30] some growth and then also fund and feed the carriers. I personally think it's a huge mistake. I think you ought to work with the producer first and start to work [00:13:40] inside out and expand their thinking.

Now, one of the criticisms or critiques I've gotten is, "Well, hey, Reid, I got producers that don't care about making money." Well, the way you can find [00:13:50] out if people care about making money is take money away from them, and all of a sudden it starts to become important. It seems it's just really strange.

Okay, fine. If you don't care about money, I'm just gonna go ahead and reduce your commission rate by half, [00:14:00] and then all of a sudden they get kind of excited. So that just helps that producer know that they really do care about making money, and this sounds a little stupid, but they really do care about making money.

So then I [00:14:10] would do something like, "Hey, you know, someday, someday the chances are you're gonna get old, and, and if you're, you're fortunate enough to, to live, it's probably gonna happen that you're gonna end up in some old folks [00:14:20] home. And, and there's two types of old folks home. There's the kind that's really clean and really fresh and smells great, and then the one that smells like urine."

And I promise you, I would put [00:14:30] them in that car, and I'd go to a old folks home that smells like urine. You know, it's not very well taken care of, uh, it stinks when you go in there. And let them start to have that visceral [00:14:40] reaction to what life really is. I take them down to a new B- BMW dealership, and let's go test drive this car, and then let's go drive [00:14:50] your car.

And just get them to feel it so you can expand their deal. One of the biggest reasons that producers say they don't want to talk about goals, don't want to talk about [00:15:00] money, is because they don't believe they can. They don't believe they can do it. So the reason that I have this thing, that this is really becomes a playbook for making [00:15:10] money.

Here it goes. Manage your existing accounts, work your existing accounts then for red hot introductions so you get into them. Go pre-call strategy. Let's go plan to beat the bad guy. [00:15:20] You know, hop in your plane, go running down the runway and lift off. Go drive a wedge when you're prospecting the incumbent.

Either go for the BOR on the spot, or you got to go [00:15:30] market the account for some period of time. You come in and you present it, and you want to make sure you win it, wedge-proof it, and then go get your partner in. And each one of these steps has a very [00:15:40] well-defined dialogue and strategy and methodology to be able to go make it happen.

When a producer doesn't have a sales call process other than let me [00:15:50] copy, quote, and pray, and don't you love me, then they really get stuck with the ability to go grow their book of business, and so then they hide from what their real desires are, which is to have [00:16:00] better things in life. So to wrap this thing up, there's a lot of money to be made in this industry.

There's a lot of, by definition, it has to be that way, mediocre [00:16:10] competition, people who are vulnerable to people who are really sharp. If you'll sit there and start working with your, your goals with your producers, or you work on your own goals, getting really clear about what you [00:16:20] want, why you want it, what you have to do to go get it, and build that action plan, and know how much money you need to save year after year after year to get there, and then build your book of business on purpose to go [00:16:30] put you in a position to save that kind of money, then you're going to have an amazing future.

And if you don't, you'll probably have a decent future. I mean, you think about it. Everybody gets by until [00:16:40] you die. Look at the people in San Francisco. You go walk the streets. They're getting by. It's not very nice, you know, but they do get by. And we all have our standards. [00:16:50] Raise your standards is my message.

Go figure out how to go make it happen. Get in concert with your sales leader and say, "Let's go figure out how to help me grow fast and get on the same page [00:17:00] with me." So that's my message. Hey, look, Randy Schwantz, Bignition, it's the only platform on the planet built for middle-market commercial insurance [00:17:10] agencies that really want to bring a powerful sales team to the planet, help them go grow, go build a big old fast you-know-what.

And I, I'll show you some testimonials. You'll just be [00:17:20] blown away by what some of my clients are doing when they get on this thing to go make cool things happen for themselves and their producers. Thanks.

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