AAMC Training FNSSAM403: Prospecting for New Clients Assignment

This document provides a complete solution for the FNSSAM403 Prospect for new clients assignment. It includes responses to short answer questions covering prospecting methods, building client relationships, and the importance of information in credit guides. The assignment also involves LVR calculations, client needs reviews, and strategies for handling client hesitations. Furthermore, it presents research on car finance options, discusses customer data protection, and explores additional questions to ask clients based on affordability issues. The assignment concludes with an analysis of buyer motives and preparation for client follow-up, providing a comprehensive overview of client acquisition and financial product knowledge.

FNSSAM403 Prospect for new clients
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FNSSAM403 Prospect for new clients
FNSSAM403 FMB Assessment
CREDIT TRANSFER
You may be able to claim credit transfer for a unit/s of competency that you have previously
completed with AAMC Training or another RTO. If you have been awarded a record of result or
statement of attainment for any of the units detailed below then please go to the Credit
Transfer tab in your Learning Centre and follow the prompts.
This assessment relates to the following units of competency:
 FNSSAM403 – Identify opportunities for cross-selling products and services
Please refer to AAMC Training’s full Recognition Policy for further details.
Task 1 – Short Answer
In order to successfully complete some of the tasks in this assessment you should have access to
the following documents. These are available in the AAMC Training Useful Resources or you may
wish to find your own/use your company documents.
 Credit Guide – important facts about the business and products you provide
 Adviser Profile – this may be included in your credit guide and could be simply your licence
number as the services you provide are one in the same as your licensee
 Client Needs Review – for client data gathering
 Preliminary Assessment
Questions
1. What do you believe to be three good prospecting methods and why?
1 Cold calling Increase likelihood of a sale
2 Email marketing Free and fast
3 Content marketing Attracts, retains and drives custome action
2. In your own opinion, what are some areas which are important to say about yourself and your
business when creating a Facebook or LinkedIn profile? Why would correct and professional
information be important to your organisation?
The name, mission and goals of the business. My professional qualification and exptertise in
the business. Physical address and contacts of the business.
Correct information will honesty and trust from the customers while professional information
will set the tone of the engagement on social media.
3. What is cold calling? Is cold calling an effective prospecting method? Explain your answer.
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Cold calling is the initial stage in the selling process. It’s the first call made to a potential
customer. This is an effective method because as a communication tool it targets potential
customers who are likely to increase sales.
4. How would you build a relationship with a client through cold calling?
By informing the client who I am, the organization I represent and the purpose for calling
which is not selling but to listen and answer any questions. After the trust is worn then selling
will automatically come in.
5. In your opinion, why would the following areas of information (found in the Credit Guide) be
important for a new client to understand? How could this information protect all parties?
 your role and responsibility as Credit Advisor
To know the type of inquiries to make. This enables both parties to act within their
jurisdictions.
 the role of the organisation
To know whether the organization will offer solutions to the client problems. This helps
both parites in that there is common expectations from the client and organizations
leading to satisfaction on both sides.
 the identity of and information about the Credit Licence holder
To build confidence in the client that the credit officer is qualified and professional which
helps the client in wise decision making. This protects both parties from doubt and
conjectures.
 the range of services provided
This helps the client to know whether his/her needs are met by the organization and gives
room for any possible addition of services. This protects the organization from promising
what they are not able to deliver and also makes the client not to make demands that
can’t be fulfilled by the organization
 all costs, fees, commissions etc. associated with the transaction
This helps the client to make the right decisison whether to accept the transaction, change
or differ. This information protects both parties from possible overcharging or loss of funds
because both parties are aware of the costs incurred.
 the procedures for handling complaints and disputes.
This helps the client to easily get their solutions to issues and also makes the process is
easy and satisfactory. Both parties are protected by this information since conflicts are
addressed to the right persion to handle it, thus maintaining a smooth flow in
administration and customer handling.
6. Why do you believe is it important to encourage prospective clients to express their needs and
goals when completing a data collection? So that the organization can know their expectations
and whether they are realistic. If achievable, then the organization strategizes on how to
accomplish them.
7. Your client Mary Jane has advised that she would like to purchase a home worth $400,000 and
you have worked out associated costs of around $30,000. She has a deposit of $150,000. She
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has spoken to friends and are concerned that she may have to pay mortgage insurance which
she hears can be a very high cost.
Complete a quick LVR calculation and explain the outcome to the client. Why is it important to
respond clearly to the client in this case? What could you do to make sure the client has
understood what you have advised?
Total value of assets = $400,000 + $30,000 = $430,000
Loan = $150,000
$150,000/$430,000 x 100 = 34.9%.
Mary should clearly know her financial position in relation to loan facility option to take. In this
case, if 34.9% LVR is below the allowable percentage for investment then the client car
proceed and secure the loan.
To ensure that Mary has fully understood my advice, I will request her to sign the cost analysis
and also keep regular contact with her about her decisison including her contributions to the
loan and the costs related to it.
8. Your client Mary Jane is hesitant about completing some of the information in the client needs
review. As an Adviser, you must fully complete a client needs review for a number of reasons.
What is a probing question you may ask the client to determine their resistance? What are two
points you may highlight to the client to try and overcome this situation in an appropriate
manner?
Who will pay the mortgage incase of income loss? What will happen incase of any
unpredictable accident or illness takes place?
9. A prospective client is hesitant to use you as their broker because they are already a client
with a competitor. What interpersonal techniques and communication skills would you use to
overcome this?
I will engage active listening, and effective communication, problem solving, persuasive
10. You have now gained Mary Jane’s consent to move forward with fully completing the fact
find. She has advised that further to the basic information provided above in question 7, she
is buying the home to live in and she is a single parent on a good income in long term
employment. Mary Jane would like to pay the home off early but would also like some spare
funds for a holiday over the next 12 months. Protection of the home and her child in case of
job loss or becoming ill is highly important. Mary Jane would like to purchase another
investment property down the track to provide for her retirement. Prior to a marital
separation, Mary Jane and her ex husband had paid off another mortgage. Mary Jane has a
clear credit history. The client may also like a 100% offset account as she had one in the
past and it worked well to pay the loan off quickly. Mary Jane would prefer a major bank as
she is concerned a smaller provider may not have any branches in her area.
Whilst it would be prudent to complete a fact find under normal circumstances, for this
exercise we will ask you to complete the table below. In the table below highlight and record
the client’s goals, concerns and creditworthiness (why the lender should consider them for the
loan).
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Goal Concern Creditworthiness
Buy home Single parent Good income longterm
employement
Purchase investment
property
100% offset account Clear credit history
Family safety incase of
jobloss or sickniess
Spare some funds for holiday pay the home off early
11. John has asked you for some advice on buying a car for personal use worth $40,000 over a
five year loan term. You have completed his client needs review and must now complete some
research to present John with appropriate finance options. Research and present two products
that may be appropriate for John (you can use a number of sites including rate city to
complete this activity).
1 Monthly payment of $594, upfront $380- at rate of 6.99%
2 Monthly payment of $580, upfront $400- at rate of 5.99%
12. Using a search engine, research “Ten tips to protect your customers’ personal
information”. Select one of the 10 points and in your own words briefly describe the
purpose of this step.
Restrict access to customer data. The people that acces the customer information should
be limited to those within the company and require such information. Also, the data should
be stored in the order of sensitivity such that the more sensitive information should be
centrally stored and protected. The purpose of this restriction is to ensure accountability of
customer information such that incase there is any problem of security then it can easily
be detected and corrected.
13. You have completed a fact finder, costing analysis, and LVR calculation for a client and
have worked out the due to affordability issues, based on the living expenses they have
provided, the client is unable to borrow the required loan amount. They would be able to
borrow a loan amount of $5,000 less. Referring back to your client needs review, what
additional question/s would you ask the client?
What are the crucial long-term and short term expenditures?, what is the amount of
money they spend yearly? What are the present and future income streams?
14. After you have completed the product research how would you prepare for the next
contact?
-Create a follow up schedule that highlights the time for calls and emails should be carried
out.
-Use different ways of reaching out eg email, snail mails, social networks, and tests
-However, an agreement should be struck between me and the client on the best ways of
contact and time.
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Task 2 – Written Test
1. List six buyer motives and in your own words, analyse and discuss issues relating to two
of them.
1 Profit or gain
2 Fear or loss
3 Comfort and convenience
4 Security and protection People consider security as one of the main factors
when deciding the source of purchase. This is usually
based on personal previous experience or information
about the business and its products. Therefore,
businesses strive to maintain consistency in the quality
of their products so that they can be considered as
safest by the buyers.
5 Pride and prestige Most of the consumers buy certain products because
they feel that owning such products gives them status
in the society. Most of such products are not basic needs
but just for luxury such as gold. Wearin or possessing
gold products is a sign of prestige and pride
6 Emotional satisfaction
2. Using conflict resolution and persuasion techniques, write a response to the following
examples of buyer resistance:
Not interested Sure, based on the limited time we have over the phone, you
not be interested, but am rest assured that you will benefit by
just allowing me 15 minutes. I believe that at after this the
potential reward will be great though with a small risk.
Send me some
information
Our organization posses a lot of significant information and we can easily send it
but from the past experience, they lead to extra questions. The appropriate way is to
examine our offer by taking 15 minutes only.
No money –
Can’t afford it
Yes, I understand you have a budget and will want to avoid unplanned expenses. But
you can consider our offer, after which the rewards like cost reduction , will proof to
you that this is a short-term investment and not unnecessary expense.
You’re wasting
your time
It is my pleasure to meet with a prospective client and therefore to me it is not time
wasted but gained. What you need to do is to evaluate the advantages of our offer,
and I assure of the rewards.
3. How do you successfully undertake cold calling? Explain the process from start to finish.
i. Preparation – removing any obstacle that may hinder effective communicaton for
example, by sel-preparation, preparing the environment.
ii. Introduction- I will introduce my position and purpose for calling.
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iii. Questioning – I will assist by answering questions related to the product instead of
selling
iv. Objectivity- my aim will no be to sell at this point
v. Listen and interpret- I will implore active listening at this stage and not selling
vi. Inform and educate
vii. Keep in touch- record key areas of the conversation and be informed.
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4. Read the following article, and answer the questions below.
Information in this article may not be based on current market
statistics and is for assessment purposes only
Why Melbourne’s Properties Will Keep On Rising
In Australia, over some 120 years or so of not quite so accurate statistics, property prices
have risen at an average compound rate of 10.4%, very slightly ahead of England. Again,
property prices have doubled every 7 years or so despite droughts, wars, changes of
government, interstate and overseas migration, interest rate movements, exchange rate
movements, changing rates of unemployment, CPI movements, etc.
Property cycles
When one takes a short-term view of property price movements, one can get confused by
apparently contradictory statistics. However, if you understand that property prices move
in 7-10 year cycles, the picture becomes a lot clearer.
Let’s take one obvious example. The movement in NSW and Victorian property prices tend
to be counter-cyclical to Queensland prices (especially South East Queensland). This is
heavily influenced by what is happening in the NSW & Victorian economics which
encourages migration to Queensland, and at other times in the cycle, people returning to
NSW and Victoria.
So, when Queensland prices are moving ahead strongly (because of this additional
demand from interstate migration), prices in NSW and Victoria exhibit slower growth, and
vice versa.
A study of cycles shows that the Sydney market is much more volatile than, for example,
the Melbourne market. Sydney prices rise faster but can also experience significant falls in
each cycle – Melbourne prices tend to rise rapidly (+25%, +20%) in the first two years of
an upturn and then more moderate increases of 3-7% in the remaining years of the cycle
till growth spurts again.
Relative prices in each capital city
Over the last 100+ years in Australia, each of the six State and Territory capitals have
established a fairly stable ranking with each other in terms of their median house and
apartment prices.
Traditionally, Sydney has always been the most expensive followed by Melbourne,
Canberra, Brisbane, Perth, Adelaide, Darwin & Hobart. Increases in prices in each of these
markets, for whatever reasons (mining booms, economic recessions, rural booms and
droughts etc) can cause some temporary shifts in the relative standing of each of these
cities. But these are normally temporary shifts and the long-term standings re-assert
themselves as the various cycles evolve.
continued on the next page
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In the last 3-4 years, Perth & Darwin prices (and to a lesser extent Adelaide and Brisbane
prices) have increased dramatically due to the boom in mining and oil company revenues
and increased demand for labour (and therefore housing) in those cities. Sydney and
Melbourne prices, while still rising, have slipped behind these other cities in terms of
relative price increases.
Basic demand & supply
The ever-increasing need for housing in Melbourne and Sydney is not based on temporary
boom factors but on underlying (substantial and permanent) shifts in population. Each city
has a strong underlying economy, which is not dependent on one particular industry. In
addition, estimates of Melbourne’s population for 2020 is over four million people (an
approximate increase of 25% in 13 years). This is huge in terms of population increase
and the need to accommodate these extra people.
The reality is that Melbourne’s building industry cannot build more than about 140,000
accommodation units (houses and apartments) per annum due to shortages of qualified
tradespeople of all types and shortage of suitably zoned land and the building permit
process. Demand, on the other hand, is estimated at approximately 170,000
accommodation units per annum. Added to this, State and Federal governments have all
but completely removed themselves from supply of affordable housing.
The inevitable consequence is that house and apartment prices will continue to rise
(quickly over the next 2-3 years and then more moderately). And rentals, which are
already moving up quickly, will continue to rise ahead of CPI.
Relativities with other capital cities will be restored by above average price increases in
Melbourne and then Sydney.
Interest rates
The spectre of a return to 16-17% interest rates (experienced only once in Australia’s
history and then only for a few months in 1990) has loomed large in many would-be
investors’ minds. This fear is understandable but not justified.
Interest rates are now approximately 1-1.5% above the lowest they have been in the last
40 years. From an economist’s viewpoint, they are currently above the theoretical long-
term average that they should be (arrived at by adding the present CPI increase and the
additional incentive needed to be offered for people to save and lend their money to
others – historically 1.5-2.0%).
Currently rates are above their theoretically justified level. This is not to say that the
Reserve Bank will not use one or even two more 0.25 per cent interest rate rises to send a
message to the market not to get “overheated”. Even two such increases will leave
interest rates within 2% of their 40-year lows. A 0.25% per cent increase in the average
mortgage of around $220,000 is equivalent to an extra $10.60 per week ($45.80 per
month) in repayments.
By comparison, a 10% increase in the median house price in Melbourne is equivalent to an
$817 per week ($3542 per month) increase in the owner’s wealth.
continued on the next page
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Rents
The level of rents (determined by supply & demand) and the value of the properties to
which they relate establish the rental return per annum. The rental return rises and falls at
different times in the cycle as real rents and property prices move up at different rates.
Rental returns on residential property tend to vary between about 3.5-4.0% and 5.5-6.0%.
Melbourne’s rental returns have moved very close to the top end of this range and are
showing every sign of continuing to rise further as vacancy rates continue to show a decline
from over 4% to a little over 1.1% in most parts of Melbourne. The city’s long-term imbalance
between the new accommodation that can be supplied and the level demanded by increased
population/increased member of new household formations noted above, allows the actual
level of rents to continue to rise quite quickly. This will attract new investors into the
residential house and apartment markets, which will, in turn, keep pushing prices up.
Housing affordability
There is much debate about whether houses have become “unaffordable” for young
couples. Much research has been done on the number of years’ salary it takes to buy the
“average” house, and the proportion of income taken up by mortgage repayments.
This is a very complicated issue, which has received a lot of publicity during this faux
election campaign. Despite all the rhetoric I have seen no viable recommendations come
forward and even less political commitment to solving the problem.
My view is that Australia (which has enjoyed the highest rate of home ownership in the
world) will slip in the world rankings. Those who have parents who can help them
will still be able to buy a home (especially with abundant bank credit persisting) while
those who don’t may be consigned to a life of renting. This will further stratify Australian
society with the rich getting richer and the poor getting comparatively poorer. This,
combined with governments removing themselves from constructing accommodation,
will put more reliance on a healthy private rental market and make it suicidal for
governments to remove or reduce investment incentives.
Where are we now?
The above factors of:
 Over 900 years of compound growth in residential property values;
 Where Melbourne prices are in the current price cycle;
 Where Melbourne prices are vis a vis other capital city prices right now;
 The short, medium and long term population forecasts for Melbourne;
 The building industry’s restricted capacity to build new accommodation units;
 Where we are in terms of interest rates v capital growth;
 The continuation in the rise in rents and the very low vacancy factor; and
 The lack of any coherent way of easing the pressures on accommodation
5.
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a. Explain three points from this article that would appeal to/encourage investors seeking
to buy more property in Melbourne.
1 Increasing Huge demand for housing - The need for housing is ever on the
increase in Melbourne due to the huge increase in population the current
demand is 170,000 accommodation units per annum.
2 The complete withdrawal of the state of Melbourne from the supply of affordable
housing has also influenced the high demand for housing. This implies there is a
lot of room for investors
3 The house and apartment prices are on the rise and it is projected to continue in
the next three years. A comparative study shows that the rise of median house
price in Melbourne by 10% is equal to an increase of the investors’ wealth by
$3542 per month.
b. Why would it be prudent for a person to hold on to property over the long term?
Because the price of housing is projected to quickly rise in the next 2-3 years and will
continue to rise. Also, it is expected that by 2020 the population of Melbourne have
increase by a whopping 25% thus causing the demand for housing be about 170,000
accommodation units annually.
c. Why will housing continue to become unaffordable for first home buyers?
First time home buyers will find it difficult to own a house because the houses will be
very expensive and it will take years of salary to buy in addition to mortgage
repayments that are exorbitant. The withdrawal of the government from constructing
accommodations leaves the first time buyers at the mercy of private market which is
suicidal because the private investors are there to make money
5. List six different prospecting methods and in your own words, compare and contrast two
of them.
Prospectin
g method
Explanation (only two required)
1 Cold calling Cold calling is the initial stage in the process of selling and it is the
first telephone calls to a potential customer. The objective is not to
sell but create a rapport.it is applicable to new customers
2 Referrals
3 Content
marketing
This involves physical attendance of trade shows a nd maintining contact with previous
clients. This is a process which takes time to develop. It is applicable to unestablished
businesses
4 Networking
5 Social
networking
6 a. Seminars and
webinars
6. Name at least eight different marketing techniques and in your own words describe the
pros and cons of three of them.
Marketing Pros Cons
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Techniques
1 Cause marketing Develops good customer
relations by providing public
awareness of its values and
desire to offer support to
benefitial projects
-incase the other party(non-
profit entreprise) does
something wrong then the
reputation is hurt
2 Direct selling -It targets specific customers
with specific message.
-It is personalized thus
reaches the audience with a
personal touch
-It is measurable and thus
helps to plan for future
marketing
-It is intrusive and maybe
annoying to many people
-The response rate is usually low
more so when the targeted
customer is not interested in the
product
-direct selling like telemarketing
may be costly
3 Cobranding and
affinity marketing
4 Earned media/PR
5 Paid media
advertising
6 Word of mouth
advertising
7 Social networks -Cost effective. It doesn’t cost
anything to share images,
tweet or post a link in
facebook
-Targets specific audience
based on gender, status,
location etc eg facebook
-time consuming. Social media
needs active participant to
respond to people and online
interaction.
-threat of hacking. The business
social account may be hacked
and used to the advantage of
the competitiors
8 Story telling
7. Access the following website: https://www.finder.com.au/equipment-finance
Explain the difference between a hire purchase and a novated lease. Analyse the strengths
and weaknesses of the products and services offered.
Hire purchase Novated Lease
Is a situation where a financier purchases an
asset on behalf of the client and then the
client buys it in instalments.
A novated lease is an agreement of a finance lease
with a financier where the employer makes
deductions from the income before tax of the
client.
Strengths Weaknesses Strengths Weaknesses
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