Deep-diving into the self-employed pool

More than one in every eight workers in Australia are self-employed.

In everything from working capital for restaurateurs to utes for tradies, imaging equipment for dentists and boards for surf schools, the opportunities for brokers to help clients strengthen their businesses are endless.

And that doesn’t even include finding them the very best mortgage product.

But, as everyone knows, working with a self-employed client application isn’t as straight-forward as a PAYG client. Many who are their own boss have irregular income and integrated personal and business affairs.

All this week, LMG has been focusing on helping its brokers win more, and better service existing, self-employed clients.

LMG members were provided insights from:

• Banjo, with its team presenting their annual SME Compass Report, helping brokers understand emerging trends in the small and medium-size business market;

• Tax Assure, breaking down compliance and best practice in tax debt management;

• LMG Commercial Finance, outline the intricacies of construction and development finance.

LMG also showcased a game-changing MyCRM feature as part of the week of activities that will streamline and digitise a client’s commercial, asset finance and residential deals and records within the single platform.

Currently in-pilot with 100 commercial brokers, the suite includes tools to capture a 360-degree view of each client (deals, relationships and connections), visualise complex business structures, prepare commercial credit papers, originate diversified applications and more.

LMG’s National Director of Broker Education Louise Rainger said: “We’re committed to providing brokers with the knowledge, resources and tools to diversify their revenue streams and build smarter businesses”.

“As part of Self-Employed Week, we tapped into the expertise across LMG’s Commercial specialists as well as industry specialists.”

Figures from the Australian Industry Group showed some industries had a higher proportion of self-employed clients. Industries like transport and warehousing and real estate - which both experienced significant growth during the pandemic - had a strong representation of self-employed clients.

More than 40% of the agriculture sector - in which land values have surged in recent years - is self-employed.

Andrew Rose launched Blue Rose Financial in late 2022 and identified the need to cater to self-employed clients who were both existing and referred to him via financial advisers and accountants.

“If you’re simply focusing on residential you’re limiting yourself in revenue streams and leads from referral partners,” he said.

Commercial deals can take longer to materialise, but can be worthwhile for brokerages, said Mr Rose. Over the last 18 months, he has helped clients purchase warehouse buildings, secured working capital and helped clients fund acquisitions of businesses with freehold buildings.

“A lot of the time, when I’m organising a commercial facility for a self-employed client, I’ll bring over their home loan as well. It might be a $10m commercial property purchase and as part of that, I’ll refinance $3m in residential assets which are commonly used as equity.”

Mr Rose said LMG Commercial had supported him with getting accreditations with commercial lenders and training.

“Over the last 12 months my business activity would be split 70/30 in favour of residential, but in the last quarter it would be almost even – enquiry for commercial is growing every month.”