Yellow Brick Road, the baby of entrepreneur Mark Bouris, has ended its aggressive growth phase and will become a franchise wealth management business.
The plan includes a transition to a franchise model, cuts in staff and a focus on increased network productivity and adviser recruitment.
The changes follow the acquisition of four businesses — Resi Mortgage Corporation, Vow Financial, Brightday and Loan Avenue — and a three-year, $20 million brand investment in Yellow Brick Road.
“Moving to a franchise model is an important progression in our operations,” says Bouris, the executive chairman.
“The old licence structure served us well but is not adequately responsive or commercial to meet the future challenges and opportunities for a retail oriented businesses like ours.
“We’ve had a period of phenomenal growth with multiple acquisitions and the development of new proprietary technologies. It is prudent we bed down this activity and successfully consolidate the acquisitions.”
Bouris says the broader restructure involves the removal of a number of management level roles across the company in lending, wealth and marketing.
This will result in a decrease in direct staffing costs.
“In line with the reduction of a number of high cost senior management roles and other various management layers in the whole group, I have asked the remaining senior managers to adopt what I call a ‘step in’ mindset so they will be stepping into the roles that have been eliminated,” Bouris says.
“This will be done starting with me as executive chairman. Consolidation is about creating new efficiencies and reducing costs and all of us working harder to achieve the targets.”
In February, Yellow Brick road posted a 288% rise in revenue to $59.2 million and a net loss of $4.25 million.